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White Spirits and RTDs - UK - December 2015

“Brands innovating with flavour should focus on the premium tier and try to resist gimmicky variants such as those which have harmed the flavoured vodka category in the US.”
– Chris Wisson, Senior Drinks Analyst

This report examines the following areas:

  • How can white rum reverse its fortunes?
  • To flavour or not to flavour?
  • Bridging the gap between brands and own-labels
  • Smaller bottles could have large potential

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Table of contents

  1. Overview

    • What you need to know
      • Covered in this report
      • Executive Summary

          • The market
            • Steady value growth masks stagnating volumes
              • Figure 1: Forecast of UK value sales of white spirits and RTDs, 2010-20
              • Figure 2: Forecast of UK volume sales of white spirits and RTDs, 2010-20
            • Vodka remains vital to the white spirits market
              • The off-trade outperforms the on-trade
                • Companies, brands and innovation
                  • Diageo leads the way in both value and volume sales
                    • Smirnoff stretches further clear in the vodka segment
                      • Figure 3: Retail value sales of the leading white spirits and RTD brands in the UK, 2014/15*
                    • Gin continues to thrive
                      • White rum hits stormy waters
                        • Tequila/Mezcal remains small
                          • RTDs’ mixed fortunes continue
                            • Total category adspend flatlines in 2014
                              • The consumer
                                • 63% of adults drink white spirits/RTDs
                                  • Figure 4: Usage of types of white spirits, September 2015
                                • Large supermarkets dominate off-trade sales
                                  • Figure 5: Willingness to spend on white spirits, per bottle, September 2015
                                • Vodka enjoys a number of positive associations
                                  • Price hinders consumers’ willingness to experiment
                                    • Figure 6: Attitudes towards white spirits and RTDs, September 2015
                                  • Flavoured variants enjoyed across the white spirits categories
                                    • What we think
                                    • Issues and Insights

                                      • How can white rum reverse its fortunes?
                                        • The facts
                                          • The implications
                                            • To flavour or not to flavour?
                                              • The facts
                                                • The implications
                                                  • Bridging the gap between brands and own-labels
                                                    • The facts
                                                      • The implications
                                                        • Smaller bottles could have large potential
                                                          • The facts
                                                            • The implications
                                                            • The Market – What You Need to Know

                                                              • Steady value growth masks stagnating volumes
                                                                • Vodka remains vital to the white spirits market
                                                                  • The off-trade outperforms the on-trade
                                                                  • Market Size and Segmentation

                                                                    • Steady value growth masks stagnating volumes
                                                                      • Figure 7: Total value and volume sales of white spirits and RTDs, at current and constant prices, 2010-20
                                                                      • Figure 8: Forecast of UK value sales of white spirits and RTDs, 2010-20
                                                                      • Figure 9: Forecast of UK volume sales of white spirits and RTDs, 2010-20
                                                                      • Figure 10: Ratio of value and volume sales in the white spirits and RTDs market, by segment, 2015 (est)
                                                                    • Vodka remains vital to the white spirits market
                                                                      • Figure 11: Total value and volume sales of vodka, at current and constant prices, 2010-20
                                                                      • Figure 12: Forecast of UK value sales of vodka, 2010-20
                                                                    • The gin-naissance continues
                                                                      • Figure 13: Total value and volume sales of gin, at current and constant prices, 2010-20
                                                                      • Figure 14: Forecast of UK value sales of gin, 2010-20
                                                                    • White rums continue to struggle
                                                                      • Figure 15: Total value and volume sales of white rum, at current and constant prices, 2010-20
                                                                      • Figure 16: Forecast of UK value sales of white rum, 2010-20
                                                                    • Tequila/Mezcal in growth from a smaller base
                                                                      • Figure 17: Total value and volume sales of tequila/Mezcal, at current and constant prices, 2010-20
                                                                      • Figure 18: Forecast of UK value sales of tequila/Mezcal, 2010-20
                                                                    • RTDs’ woes expected to continue
                                                                      • Figure 19: Total value and volume sales of RTDs, at current and constant prices, 2010-20
                                                                      • Figure 20: Forecast of UK value sales of RTDs, 2010-20
                                                                  • Channels to Market

                                                                    • The off-trade outperforms the on-trade
                                                                      • Figure 21: Value and volume sales of white spirits and RTDs, by channel, 2013-15
                                                                  • Market Drivers

                                                                    • Alcoholic drink prices continue to rise
                                                                      • Figure 22: UK excise duty rates for selected alcoholic drinks, 2003-15
                                                                      • Figure 23: RPI indexed annual change for alcoholic drink prices versus all items except housing, 2000-14
                                                                    • An embattled on-trade industry
                                                                      • UK consumers continue to cut back on alcohol
                                                                        • Bridging the gender divide
                                                                          • Figure 24: Usage of types of dark spirits and liqueurs, by gender, July 2015
                                                                        • Population changes could also impact the market
                                                                        • Key Players – What You Need to Know

                                                                          • Diageo leads the way in both value and volume sales
                                                                            • Smirnoff stretches further clear in the vodka segment
                                                                              • Gin continues to thrive
                                                                                • White rum hits stormy waters
                                                                                  • Tequila/Mezcal remains small
                                                                                    • RTDs’ mixed fortunes continue
                                                                                      • Total category adspend flatlines in 2014
                                                                                      • Market Share

                                                                                        • Diageo leads the way in both value and volume sales
                                                                                          • Figure 25: Leading manufacturers’ shares of white spirit and RTD sales in the UK off-trade, 2014/15*
                                                                                          • Figure 26: Retail prices of selected white spirit brands (70cl bottles), October 2015
                                                                                        • Smirnoff stretches further clear in the vodka segment
                                                                                          • Many other vodka brands are thriving, while own-label takes a hit
                                                                                            • Figure 27: Retail value sales of the leading vodka brands in the UK, 2012/13-2014/15
                                                                                          • Gin continues to thrive
                                                                                            • Strong performers elsewhere in the gin segment
                                                                                              • Figure 28: Retail value sales of the leading gin brands in the UK, 2012/13-2014/15
                                                                                            • White rum hits stormy waters
                                                                                              • Figure 29: Retail value sales of the leading white rum brands in the UK, 2012/13-2014/15
                                                                                            • Tequila/Mezcal remains small
                                                                                              • Figure 30: Retail value sales of the leading tequila/Mezcal brands in the UK, 2012/13-2014/15
                                                                                            • RTDs’ mixed fortunes continue
                                                                                              • Figure 31: Retail value sales of the leading RTD brands in the UK, 2012/13-2014/15
                                                                                          • Brand Communication and Promotion

                                                                                            • Total category adspend flatlines in 2014
                                                                                              • Figure 32: Recorded above-the-line, online display and direct mail total advertising expenditure on white spirits and RTDs, by category, 2012-15
                                                                                            • BBFB and Diageo dominate leading brands’ adspend
                                                                                                • Figure 33: Top 10 highest-spending brands in the white spirits and RTDs category, 2012-15
                                                                                              • Other selected campaigns
                                                                                                • TV remains the most popular channel for advertisers
                                                                                                  • Figure 34: Channels for advertising in the white spirits and RTDs category, 2012-15
                                                                                              • Launch Activity and Innovation

                                                                                                  • NPD in vodka
                                                                                                    • Absolut continues to lead the way in NPD activity
                                                                                                      • Other selected vodka launches
                                                                                                        • NPD in white rum
                                                                                                          • NPD in gin
                                                                                                            • NPD in RTDs
                                                                                                            • Brand Research

                                                                                                                • What you need to know
                                                                                                                  • Brand map
                                                                                                                    • Figure 35: Attitudes towards and usage of selected white spirits brands, August 2015
                                                                                                                  • Key brand metrics
                                                                                                                    • Figure 36: Key metrics for selected white spirits brands, August 2015
                                                                                                                  • Glen’s Vodka thrives in value associations
                                                                                                                    • Figure 37: Attitudes, by white spirits brand, August 2015
                                                                                                                  • Tanqueray and Grey Goose seen as exclusive
                                                                                                                    • Figure 38: Brand personality – macro image, August 2015
                                                                                                                  • Gordon’s enjoys traditional associations
                                                                                                                    • Figure 39: Brand personality – micro image, August 2015
                                                                                                                  • Brand analysis
                                                                                                                    • Absolut promotes style and cool, but offers more accessibility than Grey Goose
                                                                                                                      • Figure 40: User profile of Absolut, August 2015
                                                                                                                    • Smirnoff’s all-round image ensures that it continues to perform strongly
                                                                                                                      • Figure 41: User profile of Smirnoff, August 2015
                                                                                                                    • Grey Goose has a particularly premium brand image
                                                                                                                      • Figure 42: User profile of Grey Goose, August 2015
                                                                                                                    • Tanqueray is seen as a sophisticated brand but lacks the tradition of Gordon’s
                                                                                                                      • Figure 43: User profile of Tanqueray, August 2015
                                                                                                                    • Gordon’s traditional perception drives strong usage among older groups
                                                                                                                      • Figure 44: User profile of Gordon’s, August 2015
                                                                                                                    • Bacardi has an all-round image, but may be losing ground on Gordon’s
                                                                                                                      • Figure 45: User profile of Bacardi, August 2015
                                                                                                                    • Glen’s is noted for value but lacks same strength of personality as others
                                                                                                                      • Figure 46: User profile of Glen’s, August 2015
                                                                                                                  • The Consumer – What You Need to Know

                                                                                                                    • 63% of adults drink white spirits/RTDs
                                                                                                                      • Large supermarkets dominate off-trade sales
                                                                                                                        • White spirits could do more to leverage gifting opportunities
                                                                                                                          • Vodka enjoys a number of positive associations
                                                                                                                            • Price hinders consumers’ willingness to experiment
                                                                                                                              • Flavoured variants enjoyed across the white spirits categories
                                                                                                                              • Usage of White Spirits and RTDs

                                                                                                                                • 63% of adults drink white spirits and/or RTDs
                                                                                                                                  • Figure 47: Usage of types of white spirits, September 2015
                                                                                                                                • White rum and gin follow similar usage trends
                                                                                                                                  • Tequila needs to move beyond its shot associations
                                                                                                                                    • Pre-mixed drinks used by a quarter
                                                                                                                                      • Figure 48: Usage of types of RTDs, September 2015
                                                                                                                                    • 17% of adults drink four or five types of white spirits
                                                                                                                                      • Figure 49: Repertoire of usage of white spirits, September 2015
                                                                                                                                    • Vodka also garners the highest degree of favouritism
                                                                                                                                      • Figure 50: Favourite types of white spirits/RTDs, September 2015
                                                                                                                                  • Purchasing Locations and Spending on White Spirits and RTDs

                                                                                                                                    • Large supermarkets dominate off-trade sales
                                                                                                                                      • Figure 51: Off-trade locations for buying white spirits and RTDs, September 2015
                                                                                                                                    • Specialists and online channel remain niche
                                                                                                                                      • Gifting can be an effective means of encouraging trading up
                                                                                                                                        • White spirits could do more to leverage gifting opportunities
                                                                                                                                          • Figure 52: Willingness to spend on white spirits, per bottle, September 2015
                                                                                                                                          • Figure 53: Buying white spirits as a gift, September 2015
                                                                                                                                      • Perceptions of White Spirits

                                                                                                                                        • Vodka enjoys a number of positive associations
                                                                                                                                            • Figure 54: Perceptions of white spirits, September 2015
                                                                                                                                          • Gin is thriving but modernising could spark further growth
                                                                                                                                            • Tequila’s image appears to revolve around shots
                                                                                                                                              • White rum fails to stand out
                                                                                                                                                • White spirits and premiumisation
                                                                                                                                                • Attitudes towards White Spirits and RTDs

                                                                                                                                                  • Price hinders consumers’ willingness to experiment
                                                                                                                                                    • Figure 55: Attitudes towards white spirits and RTDs, September 2015
                                                                                                                                                    • Figure 56: Comparison of attitudinal responses of any agree for white spirits and RTDs vs the same statements asked for dark spirits and liqueurs, September 2015 and July 2015
                                                                                                                                                  • White spirits with mixers provide opportunities
                                                                                                                                                    • Price is more important than brand for many drinkers
                                                                                                                                                      • Interest in NPD and alcohol units driven by younger drinkers
                                                                                                                                                      • Interest in Flavoured White Spirits

                                                                                                                                                        • Flavoured variants enjoyed across the white spirits categories
                                                                                                                                                          • Figure 57: Usage of flavoured types of white spirits, September 2015
                                                                                                                                                        • Fruit flavours lead the way in terms of flavours of interest
                                                                                                                                                          • Figure 58: Interest in flavours of white spirits, July 2015
                                                                                                                                                      • Appendix – Data Sources and Abbreviations

                                                                                                                                                        • Data sources
                                                                                                                                                          • Fan chart forecast
                                                                                                                                                            • Abbreviations
                                                                                                                                                            • Appendix – Market Size and Segmentation

                                                                                                                                                                • Figure 59: Best- and worst-case forecasts for the total white spirits and RTDs market, by value, 2015-20
                                                                                                                                                                • Figure 60: Best- and worst-case forecasts for the total white spirits and RTDs market, by volume, 2015-20
                                                                                                                                                                • Figure 61: Best- and worst-case forecasts for the vodka market, by value, 2015-20
                                                                                                                                                                • Figure 62: Best- and worst-case forecasts for the vodka market, by volume, 2015-20
                                                                                                                                                                • Figure 63: Forecast of UK volume sales of vodka, 2010-20
                                                                                                                                                                • Figure 64: Best- and worst-case forecasts for the gin market, by value, 2015-20
                                                                                                                                                                • Figure 65: Best- and worst-case forecasts for the gin market, by volume, 2015-20
                                                                                                                                                                • Figure 66: Forecast of UK volume sales of gin, 2010-20
                                                                                                                                                                • Figure 67: Best- and worst-case forecasts for the white rum market, by value, 2015-20
                                                                                                                                                                • Figure 68: Best- and worst-case forecasts for the white rum market, by volume, 2015-20
                                                                                                                                                                • Figure 69: Forecast of UK volume sales of white rum, 2010-20
                                                                                                                                                                • Figure 70: Best- and worst-case forecasts for the tequila/Mezcal market, by value, 2015-20
                                                                                                                                                                • Figure 71: Best- and worst-case forecasts for the tequila/Mezcal market, by volume, 2015-20
                                                                                                                                                                • Figure 72: Forecast of UK volume sales of tequila/Mezcal, 2010-20
                                                                                                                                                                • Figure 73: Best- and worst-case forecasts for the RTDs market, by value, 2015-20
                                                                                                                                                                • Figure 74: Best- and worst-case forecasts for the RTDs market, by volume, 2015-20
                                                                                                                                                                • Figure 75: Forecast of UK volume sales of RTDs, 2010-20
                                                                                                                                                            • Appendix – Market Share

                                                                                                                                                                • Figure 76: Leading manufacturers’ shares of white spirits and RTDs in the UK off-trade, 2014/15*
                                                                                                                                                                • Figure 77: Retail volume sales of the leading vodka brands in the UK, 2012/13-2014/15
                                                                                                                                                                • Figure 78: Retail volume sales of the leading gin brands in the UK, 2012/13-2014/15
                                                                                                                                                                • Figure 79: Retail volume sales of the leading white rum brands in the UK, 2012/13-2014/15
                                                                                                                                                                • Figure 80: Retail volume sales of the leading tequila/Mezcal brands in the UK, 2012/13-2014/15
                                                                                                                                                                • Figure 81: Retail volume sales of the leading RTD brands in the UK, 2012/13-2014/15

                                                                                                                                                            Companies Covered

                                                                                                                                                            To learn more about the companies covered in this report please contact us.

                                                                                                                                                            White Spirits and RTDs - UK - December 2015

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