UK spirits market has never been stronger, say suppliers

The UK market for spirits has never looked in better shape, according to suppliers polled in OLN’s annual Spirits Report. 

The report questioned a wide range of spirits suppliers and producers – including some of the UK’s biggest players in the sector such as Pernod Ricard, William Grant and Diageo – about all aspects of the UK spirits market, and all reported that their sales had increased in the past year.

The vibrant bar scene in many of the UK’s big cities continues to provide a great launch pad for new spirits, and the ongoing trend for cocktails has also boosted consumer interest.

While traditionally the on-trade has been seen as the best place to launch spirit brands and consolidate their position within the market, the trend for drinking at home means the off-trade is becoming increasingly important to suppliers wanting to gain greater brand recognition.

And it’s premium spirits which have been largely driving sales growth.

“We know spirits drinkers are more willing to spend on premium drinks and premiumisation is the key to continued growth, with our portfolio perfectly positioned to drive this,” said Pernod Ricard’s channel director, off-trade spirits, Chris Shead.

“For example, premium spirits’ share of the market increased by 20% last Christmas compared with the rest of the year, and we would expect an equally, if not more, positive performance this Christmas as people look to treat themselves or seek out gifts for family, friends and hosts.”

And the trend for quality over quantity appears to be gathering pace as health-conscious consumers increasingly monitor their drinking more closely.

 “Almost half of people agree to be drinking less, but are choosing higher quality alcohol when they do,” said Paul Isherwood, Diageo’s head of off-trade category development.

 “Adult drinkers are no longer content with the average beverage, they are after the premium experience and we’ve seen this through category growth within premium vodka and gin, cocktails and craft beers.”

He compared the spirits category with other food and drink sectors, such as coffee and chocolate, in which consumers are increasingly interested in the origins of their food and drink.

This was confirmed by his colleague, Diageo customer marketing director, Richard Barlow. “Consumers are interested in provenance, ingredients and stories behind products and brands,” he said.

“They are also seeking out options which offer some form of customisation and personalisation. The spirits category is able to tap into all of these. It is a category full of possibilities – long, short, still, fizzy, pink, green, hot or cold.”

William Grant & Sons category manager Faye Oliver reports a sales increase for many premium brands. “Sixty-one percent of spirits growth has been driven by premium spirits, showing consumers are more interested in buying into luxury,” she said. “In the off-trade specifically, premium spirits have grown by 8.2%.”

Neil Boyd, commercial director of malts at Ian Macleod Distillers, reports a similar story. “Our single malt whiskies, the recently launched Tamdhu and upgraded Glengoyne, and premium gin brand Edinburgh Gin, in particular, have seen sales increase,” he said.

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