The at-home alcoholic drinks market remains robust, with 80% of adults buying beverages for home consumption in the last year. Grocery stores dominate as the primary distribution channel, with 98% purchasing through such retailers.
The industry faces significant headwinds. Inflation, rising living costs, and changes to alcohol duty have pushed up prices, creating a challenging environment for retailers. Furthermore, the growing popularity of non-alcoholic alternatives and evolving health-conscious preferences hint at a shifting landscape that demands fresh approaches.
Additionally, discount grocery competitors and Amazon are intensifying the battle for market share. These factors, combined with potential shifts toward out-of-home consumption as household finances improve, pose persistent threats to retailers seeking to maintain relevance and loyalty.
The most exciting opportunities lie in digital and experiential retail. E-commerce is rapidly expanding, with younger shoppers driving online purchases of alcohol. Additionally, interest in in-store experiences like tastings and “meet the producers” events shows promise, with nearly a quarter of consumers drawn to these formats. Social media’s immense influence also opens doors, as 34% of shoppers have tried new drinks based on online inspiration.
This report looks at the following areas:
- Analysis of the current size and five-year forecast of the at-home alcohol market, highlighting the sector’s resilience and dominance of the grocers
- The effects of ongoing inflation and increased alcohol duties on retailers, and how a polarising recovery among consumers can be addressed
- The rise of health-conscious trends and non-alcoholic alternatives, reflecting shifting consumer preferences, alongside the growing demand for ethical and sustainable options.
- The opportunities for specialists to stand out through experiential formats like tastings and loyalty programmes, creating unique customer experiences.
- Other opportunities in own-label products, smaller packaging formats, and leveraging social media to drive trial and foster stronger customer connections.
Alcohol demand remains strong despite rising prices. Many consumers are seeking to upgrade their purchases, but growing moderation and abstention signal new challenges.
Natalie Macmillan, European Analyst – Retail
Market Definitions
This Report uses market and consumer research and key retailer metrics to give an overview of the UK alcoholic drinks retailing sector. This includes all types of alcohol, as well as low/non-alcoholic variants of drinks that typically contain alcohol (eg alcohol-free beer).
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EXECUTIVE SUMMARY
- Opportunities for the alcohol retailing market
- Use a targeted rewards programme to shoppers
- Consider tiered loyalty and embedded schemes
- Upsell to shoppers seeking indulgence…
- …sampling can encourage trading up
- Moderation trend represents an opportunity to trade-up in gifting
- Specialists need to engage with influencers to combat the rise of D2C brands
- Market dynamics and outlook
- Market size and forecast
- Volumes in decline, inflation drives value sales
- Graph 1: off-trade sales of alcoholic drinks, by value and volume, 2022-24
- Wine most popular drink by value, volumes in most segments fell in 2024
- Graph 2: off-trade value sales of alcoholic drinks, by category, 2022-24
- Specialist alcoholic drinks retailers’ sales hit £2 billion in 2024
- Graph 3: estimated retail sales of specialist alcoholic beverages retailers*, 2019-24
- Key market drivers
- What consumers want and why
- Reasons for buying drinks for at-home consumption
- Graph 4: reasons for buying alcoholic drinks for at-home consumption, 2025
- Channels and retailers used
- Graph 5: retailers used to purchase alcoholic drinks for at-home consumption in the last 12 months, 2025
- Improving the shopping experience: in-store and online
- The increasing influence of social media and online personalities
- Graph 6: relevance of social media and influencers on shopping for alcoholic drinks, 2025
- Ethics and sustainability issues rising up the agenda
- Graph 7: influence of ethics and sustainability when shopping for alcoholic drinks, 2025
- Discounts, samples and small sizes encourage trial and purchase
- Graph 8: factors to encourage trying new alcoholic drinks, 2025
- Retailer activity
- Non-specialist retailers dominate sales of alcoholic drinks
- Graph 9: breakdown of value sales (inc. VAT) of alcoholic drinks by type of retailer, 2022/23
- Majestic outperforms most other specialists
- Supermarkets focussing on low and no alcohol segment
- M&S introducing AI tool to help customers choose the perfect wine
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MARKET DYNAMICS
- Market size: total off-trade sales
- Increased alcoholic drinks sales reflect higher prices …
- Graph 10: off-trade* sales of alcoholic drinks, by value**, 2022-24
- …while volume sales fall steadily
- Graph 11: off-trade* sales of alcoholic drinks, by volume, 2022-24
- RTDs, cider and beer see biggest percentage increases but in absolute terms spirits prices have grown the most
- Graph 12: trends in the average price per litre* of different alcoholic drinks, 2022-24
- Market segmentation: off-trade by product
- Beer is the largest off-trade category by volume, but wine is worth 70% more by value
- Beer volumes hit by ‘trading down to trade up’
- Shoppers trade down and into deals in wine
- Spirits and liqueurs: emerging brands shake up the category
- RTDs are still the growth area in the off-trade
- Market size: specialist alcoholic drinks sector
- Specialist retail sector returns to value and volume sales growth in 2024
- Graph 13: retail sales (inc. VAT) of alcoholic beverage, other beverage and tobacco retailers, 2019-23
- Sales growth has continued into 2025
- Graph 14: monthly trends in retail sales index for retail sales of alcoholic beverage, other beverage and tobacco retailers, 2024-25
- Graph 15: average value weekly sales of alcoholic beverage, other beverage and tobacco retailers, non-seasonally adjusted, 2024-25
- Specialists’ sales start to fizz again
- Specialist alcoholic drinks retailers’ sales hit £2 billion in 2024
- Graph 16: estimated retail sales of specialist alcoholic beverages retailers (inc. VAT), 2019-24
- Number of specialists have declined since the pandemic
- Graph 17: numbers of specialist beverage retail businesses and outlets, 2018/19-2022/23*
- Market forecast: specialist alcoholic drinks sector
- Forecast – note on US trade disruption
- The impact of US tariffs on alcoholic drinks retailing
- Specialist sector forecast to grow by 14.8% between 2025 and 2030
- Continued but slowing inflation and declining volumes set to characterise market
- Channels of distribution
- Non-specialist retailers dominate sales of alcoholic drinks
- Graph 18: breakdown of value sales (inc. VAT) of alcoholic drinks by type of retailer, 2022/23
- Tesco building scale in low and no-alcohol drinks
- Sainsbury’s reports strong growth in premium own-label
- Waitrose sees growth from lower alcohol products
- M&S developing the mid-strength category
- Aldi ahead in sustainability
- Lidl highlights input from Master of Wine
- Co-op rolls out single-serve cans initiative
- D2C alcohol brands are flourishing….
- …..leveraging social media to appeal to younger shoppers
- Amazon’s pricing, convenience and range gives it huge advantages
- Market drivers
- Steady recovery in day-to-day confidence continues
- Graph 19: the financial wellbeing index, 2019-25
- Inflation pressures ease, but alcoholic drinks prices still 18% higher than 2019
- Graph 20: inflation (CPIH), all alcoholic beverages and core categories, 2019-24
- Recent changes to Alcohol Duty have made drinking out of home cheaper
- Shift to ABV duty presents threats and opportunities
- New EPR policy heralds a paradigm shift in how packaging waste is managed
- Increased alcohol moderation is impacting demand
- Graph 21: alcohol reduction and non-usage in the last 12 months, 2022-25
- Low/No Alcohol – a small, but growing segment
- Alcoholic drinks at home must relax and refresh
- Graph 22: qualities sought in alcoholic drinks for at-home consumption occasions, 2025
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WHAT CONSUMERS WANT AND WHY
- Types of alcoholic drink bought for at-home consumption
- Wine is the most popular alcoholic drink for at-home consumption
- Four in five adults buy alcoholic drinks for in-home consumption
- Graph 23: types of alcoholic drinks (including low alcohol versions) bought for at-home consumption in the last 12 months, 2025
- Growth in the 35-54 population set to boost beer category
- Graph 24: purchasing of alcoholic drinks (including low alcohol versions) bought for at-home consumption in the last 12 months by gender, 2025
- Capitalise on increasing shift towards moderating alcohol consumption
- Play to demand for drinks to be refreshing
- Reasons for buying alcoholic drinks for at-home consumption
- A wide variety of drivers for at-home drinking
- Graph 25: reasons for buying alcoholic drinks for at-home consumption, 2025
- Older buyers for at-home consumption most likely to pair alcoholic drinks with a meal
- Graph 26: reasons for buying alcoholic drinks for at-home consumption, by age, 2025
- Build associations with foods and meal types
- Younger buyers driving by gifting and events
- Graph 27: further reasons for buying alcoholic drinks for at-home consumption, by age, 2025
- Capitalise on desire for original gifts through personalisation
- Channels used to buy alcoholic drinks for at-home consumption
- In-store remains the most popular place to buy…
- …but online is increasingly important
- Increase focus on m-commerce
- Buying direct appeals to connoisseurs and enthusiasts
- Graph 28: channels used to shop for alcoholic drinks, 2025
- Use store environments to engage older and female shoppers
- Graph 29: channels used to shop for alcoholic drinks, 2025
- Exploit growing demand for immediacy
- Retailers used to buy alcoholic drinks for at-home consumption
- Tesco is leading supermarket retailer of alcoholic drinks, Majestic the most popular specialist
- Tesco is the most popular place to buy alcohol for at-home consumption
- Graph 30: retailers alcoholic drinks have been bought from in the past 12 months, 2025
- Majestic has the most affluent customers
- Graph 31: demographic profile of alcohol retailers, by age and household income, 2025
- Majestic and Bargain Booze appeal to a younger audience
- Improving the experience of shopping in-store
- In-store events can add value and build connections
- Graph 32: factors which would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) in-store, 2025
- Target in-store events at 25-34s
- Graph 33: agreement that in-store events would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) in-store, 2025
- Majestic offers variety of tasting options
- Promote self-sampling as a loyalty/app benefit
- Graph 34: agreement that self-service samples would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) in-store, by age, 2025
- Specialists can use value-added services to differentiate themselves
- Graph 35: interest in value-added services that would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) in-store, 2025
- 18-24s are open to suggestions, advice and information
- Graph 36: interest among 18-24s in value-added service that would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) in-store, by age, 2025
- Smaller stores: less intimidating, more convenience- and service-focused
- Improving the experience of shopping online
- Exclusive loyalty benefits most likely to improve online experience
- Graph 37: factors which would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) online, 2025
- Target younger buyers with rewards and perks
- Graph 38: loyalty/subscription/buyers’ club, 2025
- Tasting events can work for online players too
- Digital can cater to a thirst for information
- Graph 39: tech-related, 2025
- Use tech to engage with younger buyers
- Graph 40: tech-related, by age, 2025
- Personalisation and customisation can add value
- Graph 41: factors which would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) online, 2025
- Give younger customers opportunities for ‘Instagrammable’ moments
- Graph 42: factors which would improve the experience of shopping for alcoholic drinks (including low-alcohol versions) online, by age, 2025
- Maximise flexibility when it comes to payment
- Graph 43: Flexible payment options (eg installment plans), 2025
- Attitudes towards shopping for alcoholic drinks
- Use social media to reach younger and wealthier consumers
- Laithwaites uses cricket to reach target audiences
- Harness the potential of social media and influencers
- Graph 44: relevance of social media and influencers on shopping for alcoholic drinks, by age group, 2025
- Fortnum & Mason presents curated packages with wine and lifestyle influencer
- Ethics and sustainability attract younger and premium shoppers
- Graph 45: influence of ethics and sustainability when shopping for alcoholic drinks, 2025
- Specialists can focus on the added value in sustainability to offset premium prices
- Supermarkets have the scale to build accessible eco ranges
- Sampling and offers resonate with people when it comes to trying new drinks
- Graph 46: agreement with statements about trying new alcoholic drinks, 2025
- Incentivise affluent drinkers to try new brands through tiered discounts
- Graph 47: agreement with the statement “A new alcoholic drink being discounted would make me more likely to buy it”, by household income, 2025
- Smaller formats can help to make wine/spirit brands more accessible
- An opportunity to develop more premium own-label drinks
- Graph 48: agreement with the statement “I think supermarket own-label alcoholic drinks are just as good as branded versions”, 2025
- An improvement in household finances could lead to shift back out-of-home
- Graph 49: agreement with the statement “An improvement in my finances would encourage me to shift more of my spending on alcoholic drinks towards out-of-home consumption than at-home consumption”, 2025
- Younger drinkers most likely to switch to out-of-home if their finances improve
- Graph 50: “An improvement in my finances would encourage me to shift more of my spending on alcoholic drinks towards out-of-home consumption than at-home consumption, by age, 2025”
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RETAILER ACTIVITY
- Leading specialists
- A challenging environment for alcohol specialists
- Leading specialists: revenues
- Majestic thriving under Fortress ownership…
- …by expanding its channels
- Bargain Booze restructuring and growing through partnerships
- Second largest player Direct Wines sees fourth year of revenue declines
- The Wine Society sales hold steady
- Naked Wines sees three years of declining sales and launches strategic turnaround
- Leading specialists: store numbers
- Majestic sees potential for over 100 new stores
- The Wine Society has the highest ATV
- Graph 51: average transaction value (ATV) of leading specialist alcoholic drinks retailers, 2025
- Launch activity and innovation
- Aldi introduces Winefluencer Club for social media wine lovers
- Virgin Wines partners with Ocado
- Aldi doubles down on sustainability drive
- Majestic tapping into at-home beer consumption
- M&S introducing AI tool to help customers choose the perfect wine
- The Wine Society invests in sustainable packaging
- Advertising and marketing activity
- Advertising spend recovers in 2024
- Graph 52: total above-the-line, online display, direct mail and social media advertising spend by specialist alcohol retailers, 2021-24
- Majestic emphasises the link between wine and special memories
- Laithwaites looks to build trust through storytelling
- Lidl uses humour to highlight award winning own-label whisky
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APPENDIX
- Supplementary data – advertising and marketing activity
- Social is the prime advertising channel
- Graph 53: total above-the-line, online display, direct mail and social media advertising spend by specialist alcohol retailers, by spend type, 2021-24
- Direct Wines leads ATL adspend
- Market forecast data and methodology
- Market size and forecast: underlying data
- Market forecast and prediction intervals (value)
- Forecast methodology
- Report scope and definitions
- Market definition
- Abbreviations and terms
- Consumer research methodology
- Nielsen Ad Intel coverage
- Snoop SpendMapper methodology
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