Alcoholic Beverages Market – Global Industry Insights, Market Drivers, Outlook and Key Market Player
Drink which contains more than a minimal amount of ethyl alcohol or ethanol (CH3CH2OH) is known as alcoholic beverage. Alcoholic beverages are classified into three general classes, namely, beer, wine, and spirit. All grades of alcoholic beverages are produced through anaerobic fermentation of plant-derived carbohydrate materials such as fruits, berries, grains, plant saps, tubers, honey, and yeast.
The global market for alcoholic beverages is full of valuable opportunities. The key drivers for this market include increasing global young-adult demographic as well as increase in disposable income of the consumers. The demand for alcoholic beverages increases with changing taste and preferences and due to this fact, innovation and new product development plays an important role and act as a growth driver for this industry. Advancement in the distribution channels such as availability of separate counter for females, outlet on airports and online sales, moreover, growing tourism sector is another major driver for the growth of alcoholic beverage market.
Consumption of alcoholic beverages in a limited quantity is even associated with some health benefits such as prevention from cold and reduced risk of cardiovascular diseases. Drinking red wine reduces the risk of heart diseases and burns fat. As a result, introduction of healthier varieties of beer and spirits could be a lucrative opportunity for the alcoholic beverages market.
Based on the product type, alcoholic beverages can be segmented into:
- Distilled Spirits
Earlier beer used to be the major alcoholic beverage category as compared to wine and distilled spirits. However, in recent years, beer has been losing its market share to spirits. At present, more than 45 percent of the total alcohol is consumed in the form of spirits and this class holds the highest share in the global market of alcoholic beverages. Increasing demand of premium and super premium whiskey is supposed to contribute in high stability and growth of the distilled spirits market.
Based on distribution channel, the alcoholic beverages market can be segmented into:
- Hyper markets
- On shops
The marketing strategies of the alcoholic beverages market has changed a lot. According to WHO, the alcoholic beverages are marketed not solely through the traditional broadcast media (such as radio and television), but also by direct marketing technologies such as the internet and podcasts. Furthermore, by featuring alcoholic drinks in the entertainment sector such as films and songs, producers attracts the young people for the use of alcohol.
Alcoholic beverages market outlook-
- Among all the regions, Europe has the highest consumption of beer. In Europe, alcoholic beverages market lead by France and is followed by Germany, Italy, UK, and others. The high consumption rate of alcohol has also been recorded in the countries such as Estonia, Belarus, and Lithuania in this region. According to the World Bank Group, in 2015, Belarus consumed 17.1 liters per person per capita as compared to world average of 6.3 liters per person per capita.
- The market for alcoholic beverages is expected to grow in North America region due to changing trend among the young-adult people, which supports the consumption of high-quality alcoholic beverages. According to National Institute on Alcohol Abuse and Alcoholism (NIAAA), in 2015, around 6.2 percent of adult population were recorded alcoholic in United States.
- During the forecast period in Asia Pacific, India and China are supposed to have the highest increase in demand for alcoholic beverages due to the substantial growth in the disposable income, increasing population, rising living standard, and inclination of young generation towards the western culture. Availability of local spirits such as baijiu in China, propelling the growth of alcoholic beverages in Asia Pacific region.
- Market growth in the Middle East region is expected to be meager due to prohibition of alcoholic consumption according to the Islamic law.
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Alcoholic beverages market challenges-
The changes in the climate condition leads to decrease in the yield of the crop, thereby, increasing raw material prices with strict governmental regulations is one of the major challenge in the growth of the alcohol industry. Availability of substitute products and the legalization of marijuana especially in the US, could also hinder the growth of this market.
Key Players in the Global Alcoholic Beverages Market
Major companies are now adopting the merging strategies to sustain the intense competition in this market. Innovations and new product development in the manufacturing of flavored wine, vodka, beer, and cocktail such as wine based cocktails, vintage cocktails, and exotic spirits could largely drive the market growth.
Some key players in the global alcoholic beverages market include Anheuser-Busch InBev SA/NV, Bacardi Limited, Beam Suntory Inc., Constellation Brands Inc., Diageo Plc, Heineken Holding NV, Molson Coors Brewing Co., Pernod Ricard SA, SABMiller Ltd., and Carlsberg group.
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