Impact Databank: Spirits Growth Slows Amid Normalization, Macro Challenges
September 25, 2023After a pandemic-induced off-premise boost resulted in consecutive annual volume increases of seven-plus percent, 2023 will mark the U.S. spirits industry’s second straight year of sub-five-percent gains, according to Impact Databank. Control states, which comprise 20% of the category’s total volume, are up just 1% year-to-date through July, according to NABCA. The inflationary environment and unfavorable exchange rates continue to put pressure on costs—and growth.
Diageo is by far the market’s number-one player and was impacted in the first half of this year by the post-pandemic normalization trend and tough comps against calendar 2022. Looking ahead, Diageo expects a gradual sales improvement through the end of 2023 and into calendar 2024, led by its single malt Scotch range and Tequila brands—particularly Don Julio, which Diageo says is up 20% so far this year.
Sazerac is the top spirits marketer in control states, according to Impact Databank, and registered a modest 1.9% gain year-to-date through July 2023. Third-ranked Spirit of Gallo has been the fastest-growing spirits company overall the past three years—due primarily to High Noon Sun Sips—and continues to post double-digit growth year-to-date in 2023. High Noon is expected to crest well over 20 million cases in 2023, to extend its lead as the market’s largest-selling spirits brand.
With a portfolio of just one brand (Tito’s vodka), Fifth Generation is the ninth-largest spirits marketer in the U.S., and is on pace for another solid year in 2023. Tito’s firmly stands as the market’s second-largest-selling spirits brand by volume, and is number-one in dollar terms, according to Impact Databank. Beyond the top ten marketers, impressive 2023 gains are also being registered year-to-date by Campari America and Tennessee’s Ole Smoky Distillery.
Even with decelerating growth, total spirits industry volume in the U.S. is projected to surpass that of wine by mid-decade, according to Impact Databank. And by the end of 2023, the total number of spirits servings consumed annually is expected to surpass those of beer—each drink serving is 1.5 ounces of spirits, compared to 12 ounces of beer.—Juan Banaag
| Top 10 Spirits Marketers In The U.S. | ||||
| Rank | Company1 | Total 2022 U.S. Volume2 |
Control States Volume Trend YTD3 |
|
|---|---|---|---|---|
| 1 | Diageo NA | 41.7 | -2.2% | |
| 2 | Sazerac Co. | 33.1 | 1.9% | |
| 3 | Spirit of Gallo | 28.2 | 12.9% | |
| 4 | Beam Suntory | 23.4 | -2.5% | |
| 5 | Bacardi USA | 17.8 | -2.8% | |
| 6 | Heaven Hill Brands | 16.8 | 3.7% | |
| 7 | Pernod Ricard USA | 16.4 | -6.0% | |
| 8 | Proximo Spirits | 13.8 | 0.2% | |
| 9 | Fifth Generation | 11.6 | 9.5% | |
| 10 | Brown-Forman | 11.2 | -0.5% | |
| Total Top 10 | 213.7 | 0.9% | ||
| 1 includes spirits-based RTDs 2 millions of 9-liter cases 3 year to date through July Source: NABCA and IMPACT DATABANK © 2023 |
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Tagged : Diageo, Fifth Generation, Gallo, Sazerac
