Growing Demand for Premium Alcoholic Beverages Predicted to Drive the Alcoholic Beverage Market in the US Until 2020, Says Technavio

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Growing Demand for Premium Alcoholic Beverages Predicted to Drive the Alcoholic Beverage Market in the US Until 2020, Says Technavio

 

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By Technavio Research

May 12, 2016

LONDON–(BUSINESS WIRE)–According to the latest research study released by Technavio, the alcoholic beverage market in the US is projected to reach over USD 250 billion by 2020.

This research report titled ‘Alcoholic Beverage Market in the US 2016-2020’, provides an in-depth analysis of market growth in terms of revenue and emerging market trends. To calculate the market size, the report has taken into consideration the revenue generated from the retail sales of alcoholic beverages in the country. It also includes the market size based on volume, which has been calculated based on the retail consumption of alcoholic beverages.

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“Nearly 78% of sales of alcoholic beverages in the US were in open states in 2015, in terms of volume. The open states in the US are those where the state has no control or monopoly over the sales and distribution of alcoholic beverages. The remaining 22% of sales were in closed states where the state governments control the distribution and retailing of alcoholic beverages. Currently, there are 17 closed states in the US, including Montgomery and Worcester counties in Maryland,” said Vijay Sarathi, one of Technavio’s lead analysts for food and beverage research.

“Premium spirit brands are currently in higher demand than lower-priced value brands owing to the lifestyle and luxury associated with them. The presence of some of the best brands in the market such as Kendall-Jackson, Jack Daniels, and Absolut has increased the popularity of premium-quality beers, cognac, vodka, whiskey, and wine. The trend of premiumization across product categories will continue to drive the growth of the market during the forecast period,” added Vijay.

Alcoholic beverage market in the US: Product segmentation by revenue 2015

  • Beer 44.60%
  • Wine 17.84%
  • Spirits 37.56%

Source: Technavio research

Beer: largest segment of the alcoholic beverage market in the US

In terms of consumption, the beer market in the US was estimated to be about 25.2 billion liters and will reach 26.98 billion liters by 2020. Young consumers continue to experiment with new products and flavors. Canned craft beer has become popular and manufacturers have augmented production capacities to cater to this growing demand. The largest number of breweries in the US is in Colorado; it was here that canned craft beer was first introduced. In 2013, Boston Beer announced the launch of its craft beer in cans.

The growing demand for cider beer (made from fruit juice) is also expected to drive the market during the forecast period.

Spirits: second largest segment of the alcoholic beverage market in the US

In 2015, spirits consumption in the US was estimated to be about 2.13 billion liters and will likely reach 2.46 billion liters by 2020. Spirits include beverages such as vodka, gin, rum, whiskey, brandy, and tequila. This segment is growing faster when compared to the rest of alcoholic beverages. Consumer preference for spirits, especially among women, has been the most significant contributing factor. New product launches, the rise in the import of distilled spirits, and the association of spirits such as scotch whisky, and bourbon and Tennessee whisky with lifestyle are some of the other reasons for the growth of the spirits segment.

Wine market in US

In 2015, wine consumption in the US was estimated to be close to 3.22 billion liters. This will likely touch 4.03 billion liters by 2020. The wine market in the US is expected to grow steadily during the forecast period. Increased wine consumption by women and millennials will contribute significantly to market growth. Longstanding medical research attributes numerous health benefits to wine, especially red wine. Moderate consumption of wine is known to prevent cardiac conditions, enhance mental agility, and delay aging, among other health benefits. An increased focus on health and wellbeing has spurred consumer interest in wine and has contributed to its demand.

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

If you are interested in more information, please contact our media team at media@technavio.com.

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