Flavored Whiskey Market Outlook (2023 to 2033)
August 8th – The global flavored whiskey market is expected to garner a market value of US$ 28,080 million in 2023. Owing to the rising popularity, especially among Generation Z and the millennial populace, the demand for flavored whiskey is projected to upsurge throughout the forecast period. From 2023 to 2033, sales of flavored whiskey are anticipated to take a turn for the better, registering a CAGR of 7.3% to reach US$ 57,052.3 million. During the historical period 2018 to 2022, a CAGR worth 2.2% was projected for the market.
ldquo Upward trend of consumption of low-alcohol-based drinks and increasing preference for unique flavored drinks among millennials and Generation Z has augmented the demand for flavored whiskey
Flavored whiskey is a whiskey-based liqueur offering designed for the younger female consumer base who has a preference for a smoother and unique accent in their drink. With other spirit offering such as beer, vodka, and rum, whiskey manufacturers have also invested in the flavored whiskey market by expanding their product portfolio with flavored offerings.
The flavored whiskey is largely welcomed due to its ability to carve out off-tastes from the finished product to give the consumer a relaxing and sherbety finish. The flavored whiskey market is expected to be dominated by the North American region owing to its early entry into the region and rising flavored spirit in the region. The honey-flavored segment is expected to dominate the global flavored whiskey market resulting from its welcoming taste.
What are the Factors Propelling the Global Flavored Whiskey Market?
The global flavored whiskey market is expected to be driven by youth-centric product trends. The increasing younger population is expected to create demand for flavored whiskey over the forecast period. Also, a spike in the female drinking population is anticipated which requires a different taste profile to target which is why flavored spirits are expected to witness high CAGR growth in the developing regions, globally.
The introduction of a competitive segment in the mature spirit market is expected to drive the demand for flavored whiskey over the forecast period owing to the introduction of attractive drinks against old ones. A growing number of restaurants and bars in a variety of regions is expected to boost the market in the future.
A growing social media trend and a demand for social gatherings will propel the growth of flavored whiskey. Increasing interest in parties and events is expected to result in an increase in demand for flavored whiskey over the next few years.
What are the Factors Hampering the Global Flavored Whiskey Market?
The competitive flavored spirit and lower price point of craft beers over flavored whiskey are expected to restrain the global flavored whiskey market over the forecast period. Over time, excessive alcohol consumption can increase the consumer’s risk of chronic disease and other health issues. Whiskey’s heart benefits come in small doses. High consumption of alcohol can result in high blood pressure, high cholesterol, and heart disease.
Country-wise Insights
Why is North America Emerging as an Opportunistic Flavored Whiskey Market?
North America is the second-largest region, accounting for nearly 26% of the global flavored whiskey market, and is expected to maintain its market growth over the forecast period, states Future Market Insights. The fact that the regional manufacturers are the initiator of the flavored whiskey market means flavored whiskey is already a known product in the region.
Burgeoning demand for vodka and whiskey-based beverages is fuelling the regional market. The USA accounts for the largest revenue share in the regional market in 2022, backed by the soaring consumer demand for different flavors and shifting preferences towards on-the-go products. The small alcohol content and lower price of these cocktails are driving their demand among the consumers in the region.
The prominent alcohol brands are launching new products and adding distinctive flavors to offer a different taste to their favorite drinks, which is likely to increase the consumption rate of Bourbon flavor whiskey in the region. For instance, In March 2022, Pernod Ricard launched a canned ready-to-drink cocktail named Jameson Ginger & Lime, which is 6% ABV, is made with Jameson’s Irish whiskey brand which has rolled out across the US and became available stateside in time for St Patrick’s Day celebrations.
Why is the Demand for Flavored Whiskey Burgeoning in Europe?
Europe dominates the market for Flavored Whiskey in terms of revenue, owing to the large consumer base for flavored spirits in the region. The region accounts for nearly 30% and is estimated to maintain its lead during the forecast period, reveals the Future Market Insights report. Europe’s alcohol market is the largest in the world. There has been a dynamic shift in consumer behavior, with the upward trend to focus on the use of natural botanical ingredients added to spirits, growth in demand for natural wines, and increased use of fruit flavors in cider and ready-to-drink products.
With the changing requirements across Europe, alcohol brands are adapting to this change for good. Besides, the increasing awareness regarding the health benefits related to whiskey has caught the eye of teenagers and health enthusiasts. Consumers have shifted towards low alcohol-based drinks such as beer and wines in countries like Spain & Sweden. In June 2022, Summerhall Distillery expanded its range of spirits with the launch of a new blended whisky. This is likely to offer a new sweet and smooth flavor to consumers looking to taste a distinct flavor.
Additionally, In June 2022, Screwball Whiskey, the original peanut butter whiskey, introduced an innovative 100ml can to its product lineup, which comprises 750ml, 375ml, 200 ml, 50ml, and 1L glass bottles. Unlike RTD canned cocktails, this convenient and fun option offers two servings of sweet and savory flavored whiskey with no mixers, perfect for sipping straight.
How is Asia Pacific Bolstering the Demand for Flavored Whiskey?
The Asia Pacific is projected to record the fastest growth rate throughout the forecast i.e., from 2023 to 2033. The market growth is attributed to the rising demand for premium, convenient, and quality cocktails owing to the increasing influence of Western culture. Shifting lifestyles and increasing alcohol consumption in the region are other foremost factors piloting the product demand.
The convenience presented by the RTD drinks, along with the little alcohol level and cheaper price in contrast to cocktails served at bars, makes them the most preferred choice for young consumers. Prominent manufacturers are catering to sustained consumer interest in the whiskey sector and rising trends surrounding ready-to-drink consumption are estimated to propel the market growth. For instance, In April 2022, Alcohol giant Kirin launched its first hard seltzers in Japan as well as new whiskey in response to increasing demand.
The growing trend for RTD whiskey consumption trend is picking between the 20- to 30-year-old group coupled with the increasing consumption by the female population is likely to significantly boost the demand in the countries like Singapore, Thailand, Japan, and others.
Category-wise Insights
Why is Bourbon Flavored Whiskey Growing in High Demand?
A growing number of consumers are seeking out artisanal and craft spirits, and bourbon is a significant player in this market. The emergence of craft distilleries, producing flavorsome and unique bourbon varieties, has gained traction in recent years.
Drinks like Old Fashioned and Manhattan, which often contain bourbon, are gaining popularity. With the rise of cocktail culture, bourbon has become an integral part of many drinks. Market analysts forecasted a 24.50% growth rate in 2022.
The spirits industry has been impacted by consumer willingness to spend more on premium and high-quality products. As a result of its premium positioning, bourbon, particularly older and rarer variants, has become synonymous with top-of-the-line flavors and experiences, and is attracting a premium audience.
How Retail Industries are Influencing the Growth of the Flavored Whiskey Market?
Growing demand for appealing to new tastes and cost-effective prices the market is expected to grow in demand for flavored whiskey in the retail market. According to estimates, the market accounted for 78.60% of the total revenue share in 2022.
With the introduction of different flavors, whiskey producers can attract an even broader audience, including whiskey newbies and people who have never tried whiskey. Increased consumer demand could increase retail sales as a result of the expansion of the consumer base.
Whiskeys with flavors can be used in cocktails more effectively than those without flavors. In addition to adding new dimensions to classic cocktails, they can also be used to inspire new ones. Consequently, bars and restaurants will be more willing to stock flavored whiskey, which will increase retail sales in the market.
Which Flavor is Likely to Expand the Market for Flavored Whiskey Market?
The market for citrus flavors is expected to grow in the coming years. In 2022, the market accounted for 21.40% of the total market. The popularity of whiskey has skyrocketed in recent years, especially among younger consumers. With a growing number of people exploring the world of whiskey, there is an increasing demand for new and novel flavors beyond those offered by traditional brands.
Generally, citrus flavors evoke a feeling of freshness and serve as a reminder that summer is coming. As consumers seek out refreshing beverages during spring and summer, citrus-flavored whiskey may see an increase in demand.
The strong, robust taste of traditional whiskey can be quite off-putting for some individuals. Individuals who enjoy citrus flavors might be attracted to this type of whiskey in the market. With citrus flavors, a wider range of consumers might find it more approachable and palatable.
In addition to classic whiskey cocktails, citrus-flavored whiskey can add a refreshing and versatile twist to new creations, such as Old Fashioneds, Whiskey Sours, and even new whiskey cocktails. Adding citrus-flavored whiskey to a cocktail can make it more versatile. Mixologists and home bartenders alike appreciate its citrus notes, which blend well with other ingredients. As a result demand for flavored whiskey is expected to grow demand for citrus flavors in the coming years.
Key Players in the Global Flavored Whiskey Market?
Market players are focusing on the development of the products. New products are being introduced, strategic relationships are being formed with existing companies, and small-scale producers are being purchased in promising locations to expand sales. In addition, manufacturers have experimented with various application procedures to create products flavored with whiskey.
The global player in the flavored Whiskey market is Brown-Forman Corporation, Bacardi Limited, Beam Inc., The Crown Royal Company, The Old Bushmills Distillery Co., Pernod Ricard SA., and Diageo Plc. Currently, the market for flavored whiskey has the presence of many regional players who are manufacturing the flavored whiskey, and tubes.
- In March 2023, Pernod Ricard USA, a French company, announced that it acquired a majority stake in Skrewball, a peanut butter-flavored American whiskey. It represents a great opportunity for Pernod Ricard to continue strengthening its longstanding consumer-centric and premiumization strategy by adding another complementary brand to its portfolio of iconic spirits and wine brands. Earlier this year, Jameson Orange launched successfully into the flavored whiskey category.
- In March 2023, Nexira’s financial results were boosted by natural ingredients, Kraft Heinz and BEES increased their Latin American partnership, and AAK invested in plant-based food development. Bay State Milling Company launches a gut-friendly, multipurpose flour, and Pernod Ricard invests in peanut butter-flavored Skrewball whiskey.
