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  • RIES: Saturated global spirits market prompts new brands to target younger generation

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RIES: Saturated global spirits market prompts new brands to target younger generation


(Atlanta, August 17, 2020) An analysis report by Ries Positioning Strategy & Consulting on the alcoholic spirits market has found that global consumption of spirits reached 21.4 billion liters in 2019. Over the past five years, the global spirits market has grown steadily at an average rate of 1.7% per year. At present, the world’s top three spirits categories are baijiu, whiskey, and vodka.

Globally, alcohol consumption exceeded $1.04 trillion in 2019, with retail spending on spirits amounting to nearly $390 billion, or 40% of the total. In terms of volume, 21.4 billion liters of spirits were consumed across the world in 2019. The most widely consumed spirits were baijiu, whiskey, and vodka, which accounted for 23%, 17%, and 14% of total alcohol consumption respectively. Following these three spirits were “second tier” categories such as brandy, rum, tequila, and gin.

From 2014 to 2019, the global market for spirits grew steadily at an average annual rate of 1.7%. The consumed volume of baijiu, the world’s largest spirits category, was largely stable despite a slight decline, whereas total baijiu sales value grew at a compounded rate of 9.15%, indicating that volume and value were moving in opposite directions. Annual consumption of whiskey grew at an average rate of 3.16%, making it the fastest-growing category among mainstream spirits. The global spirits market is expected to be saturated by 2025. While overall consumption is set to remain within a stable range, competition for market share between various categories of spirits will become more intense, with whiskey set to become a new driver of future growth.

Laura Ries, global chairman of RIES, said, “The global spirits market is becoming saturated and growth continues to slow. Market leaders should promote themselves as being the real thing, and new brands should promote themselves as being the choice of a new generation. Spirits companies can broaden their horizons by rolling out new products with new flavors and lower alcohol. And there is always the opportunity to launch new brands in new categories.”

According to research by RIES on the mindsets that consumers have about the value of spirits, international consumers place the highest value on whiskey, followed by brandy. Whiskey and brandy are categorized as high-end spirits, while other categories are deemed “middle to low-end”. Non-Chinese consumers know little about baijiu (i.e. They do not perceive baijiu as a spirit). Consumption of baijiu in 2019 was 5.2 billion liters, 99% of which was consumed in China market, making China the world’s top consumer of spirit. Meanwhile, sales volume of baijiu accounted for 96% of the total volume of spirits sold in China, with the remaining 4% consisting of whiskey, brandy, vodka, and other spirits.

In China’s spirits market excluding baijiu, brandy and whiskey were the most widely consumed spirits, accounting for about 74% and 15% of total sales respectively. In 2019, the market for brandy was worth roughly USD 2.67 billion, making it the top category of foreign spirits in China. However, the market was encumbered by sluggish growth rates. That same year, while Chinese brandy brand Changyu accounted for nearly 50% of the total sales volume of brandy in China, its revenue was only 4% of the country’s total in this category. Meanwhile, China’s whiskey market, worth roughly USD 52.6 million in 2019, has exhibited a relatively stable outlook.  

“In China, consumers have far better awareness about spirit brands than about categories. It means that Chinese consumers don’t have sufficient knowledge about  such categories as whiskey, brandy, and vodka, but have partial recognition of specific brands, like Louis XIII, Martell, and Jack Daniels,” said Emma Xiao, RIES China senior consultant, who advises international spirits companies. “Despite the huge differences in the perceptions by Chinese and foreign consumers, the China market still has great potential. At present, global mainstream spirits account for only 4% of the total sales volume in China. For international spirits companies that aim to make breakthroughs in the China market, they should prioritize category education over brand promotion so that they can ‘embed’ category of whiskey, brandy, and others in the minds of consumers. In addition, given the strong consumer perception of whiskey globally, whiskey will become a category with the highest growth potential in the China market.”


About Ries Positioning Strategy & Consulting

Ries Positioning Strategy & Consulting was founded in 1963 by Al Ries, founder of positioning principles. The headquarter is located in Atlanta, Georgia, the United States. For more than 50 years, Ries, as the pioneer and leader of strategic positioning consulting, has helped many Fortune Global 500 companies and innovative companies establish their strategic positioning and overcome bottlenecks that have limited their growth. Ries has offices in Asia, Europe, America and other regions, where partners with deep insights in the local market provide positioning strategy and consulting services for clients.

For more information, please visit its global website:

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