2022
9
UK Dark Spirits and Liqueurs Market Report 2022
2022-09-22T17:24:58+01:00
OX1102577
2195
155782
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Report
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“Dark spirits and liqueurs’ discretionary nature and relatively high price mean that they are likely to lose sales over 2022-23 as a result of pressure on household incomes. Smaller formats,…

UK Dark Spirits and Liqueurs Market Report 2022

£ 2,195 (Excl.Tax)

Description

The UK Dark Spirits and Liqueurs Market Report examines consumer attitudes towards purchasing and consuming dark spirits and liqueurs, opportunities for flavour innovation and the impact of the cost of living crisis on the dark spirits and liqueur market. This report covers the dark spirits market size, market forecast, market segmentation and trends in the dark spirits and liqueur market.

 

Current Landscape of the Dark Spirits and Liqueur Market

The liqueur and dark spirits market’s discretionary nature and relatively high price mean that they are likely to lose sales over 2022-23 due to pressure on household incomes. Smaller formats, including RTD versions, are opportunities for brands in the dark spirits market to support sales even as shoppers economise. Extensions into sweet treats also offer a promising alternative income stream for the dark spirits and liqueur market.

 

Dark Spirits and Liqueur Market Trends and Industry Statistics

The most important consumers for the liqueur and dark spirits market are 18-34-year-olds. Given the projected decline of this population, there is a risk of erosion to the category’s volume sales in the longer term. This makes it imperative for brands in the dark spirits and liqueur market to keep users engaged as they age.

  • Liqueurs and dark spirits market size: Estimated at £6.8 billion in 2022, the total UK dark spirits and liqueurs market grew by 17.9% over 2017-22.
  • 53% of alcohol drinkers consider dark spirits and liqueurs as a good choice for an affordable gift.
  • 58% of Brits drink dark spirits, and 43% of adults drink liqueur.
  • Not liking the taste is the principal barrier for dark spirits and liqueurs usage, cited by 27% of non-users.

 

Future Liqueur and Dark Spirits Market Trends

Offering more help and guidance in navigating the dark spirits market should help brands to drive sales, given that 46% of buyers find the selection of dark spirits and liqueurs in shops overwhelming. Recommending products based on shoppers’ current flavour preferences can help keep existing users engaged and attract new users.

Meanwhile, gifting will continue to support sales in the dark spirits and liqueur market even amid the economic uncertainty of 2023, as these drinks will likely benefit from people switching away from other gift items.

To discover more about the UK Dark Spirits and Liqueurs Market Report 2022, read our UK Still, Sparkling and Fortified Wine Market Report 2022, or take a look at our Alcoholic Drinks Market Research Reports.

 

Quickly Understand

  • The likely impact of the cost of living crisis on value and volume sales of the dark spirits and liqueur market.
  • Shifts in sales and share between the on- and off-trade channels concerning dark spirits and liqueurs over 2020-22.
  • Examines consumers’ reasons for not drinking dark spirits and liqueurs or for not drinking them more often.
  • Liqueur and dark spirits market trends, launch activity over 2021-22 and opportunities for further innovation.
  • The role of gifting in driving sales within the dark spirits and liqueurs market.

 

Covered in this Report

Products: Whisky, scotch, brandy, cognac, Armagnac, rum (dark rum, golden rum, spiced rum), liqueurs, cream-based liqueurs.

Brands: Pernod Ricard (Jamesons, Havana Club, Martell), Diageo (Bell’s Whisky, Johnnie Walker, Baileys), BBFB (Jack Daniel’s), Edrington Beam Suntory (The Famous Grouse, Jim Beam, Courvoisier), William Grant & Songs (Grant’s, Sailor Jerry, Three Barrels), High Commissioner (Loch Lomond Group), Proximo Spirits (The Kraken), Campari UK (Wray & Nephew), Rémy Cointreau (Mount Gay), Disaronno International (Tia Maria), Moët Hennessy Diageo (Hennessy), E & J Gallo (Gallo), Halewood International (Jules Clairon), Amarula, Southern Comfort, Pimm’s, Jägermeister, Whyte & Mackay, Red Leg, Woods, Bardinet.

 

Expert Analysis from a Specialist in the Drinks Sector

This report, written by Alice Baker, a leading analyst in the drinks sector, delivers in-depth commentary and analysis to highlight current trends in the dark spirits and liqueur market and add expert context to the numbers.

The dark spirits and liqueurs market’s’ discretionary nature and relatively high price mean that they are likely to lose sales over 2022-23 as a result of pressure on household incomes. Smaller formats, including RTD versions, are among means for brands to support sales even as shoppers economise. Extensions into sweet treats also offer a promising alternative income stream for brands.”

Alice Baker
Senior Food & Drink Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • Market context
    • Products covered in this Report
  2. Executive Summary

    • The five-year outlook for dark spirits and liqueurs
      • Figure 1: Category outlook, 2022-27
    • The market
    • Solid volume sales growth and volatile value sales over 2020-22
    • Inflation to drive value sales growth despite declining volumes over 2022-27
      • Figure 2: Market forecast for value sales of dark spirits and liqueurs, 2022-27
    • Falling or flat off-trade sales for all dark spirit/liqueur segments in 2022
    • Inflation hits the dark spirits and liqueurs category in 2022 but this should slow after 2023
      • Figure 3: RPI inflation for off-trade wines and spirits in comparison with RPI all items inflation, 2019-22
    • Ageing population will impede category growth
    • Companies and brands
    • Diageo’s dark spirits and liqueurs brands push ahead as retail sales decline
      • Figure 4: Leading brands’ sales in the UK retail whisky market, by value, 2020/21 to 2021/22
    • Limited-edition, fruit-flavoured and L/N/R alcohol launches continue
    • Advertising spend in 2021 rises above pre-pandemic levels
    • The consumer
    • Dark spirits/liqueurs’ usage frequency falls amid rising cost of living
      • Figure 5: Usage frequency for dark spirits and liqueurs, 2021 and 2022
    • Need to highlight the range of different flavours within the category
      • Figure 6: Barriers to dark spirits and liqueurs, 2022
    • Income squeeze encourages cutbacks both at and out of home
      • Figure 7: Behaviours relating to dark spirits and liqueurs, 2022
    • Fruit flavours and pre-mixed cocktails spark appeal
      • Figure 8: Interest in innovation in dark spirits and liqueurs, 2022
    • Gifting and celebratory occasions will continue to support sales during the income squeeze
      • Figure 9: Attitudes towards dark spirits and liqueurs, 2022
  3. Issues and Insights

    • Smaller formats and extensions into sweet treats can help brands to navigate the income squeeze
    • Gifting occasions will retain their importance amid economic uncertainty
    • Satisfy shoppers’ need for guidance to drive sales
  4. Market Size and Channels to Market

    • Solid volume sales growth and volatile value sales performance over 2017-22
    • Off-trade drives volume sales growth in 2020, while on-trade losses send values plunging
      • Figure 10: Value and volume sales of dark spirits and liqueurs, by channel, 2020-22
    • On-trade recovers sales in the second half of 2021, but not enough to make up for previous losses
    • On-trade regains ground in 2022
    • Inflation runs faster in the on- than off-trade in 2022
  5. Market Forecast

    • Sales decline expected for 2022-23, some improvement in 2024
      • Figure 11: Category outlook, 2022-27
    • Inflation to drive value sales growth despite declining volumes over 2022-27
    • Financial pressures to erode volume sales in the short term, and ageing UK population in the longer term
    • Inflation to slow over 2023-27
    • Shifts in channels will impede value sales growth over 2022-27
      • Figure 12: Market forecast for value sales of dark spirits and liqueurs, 2022-27
      • Figure 13: Market forecast for volume sales of dark spirits and liqueurs, 2022-27
    • Learnings from the last income squeeze
    • Forecast methodology
  6. Retail Market Segmentation

    • Falling or flat off-trade sales for all dark spirit/liqueur segments in 2022
      • Figure 14: Retail value and volume sales of dark spirits and liqueurs, by segment, 2020-22
  7. Market Drivers

    • Inflation is the key concern for consumers and brands…
    • …and will weigh down the post-COVID recovery
    • Inflation hits the dark spirits and liqueurs category in 2022
      • Figure 15: RPI inflation for off-trade wines and spirits in comparison with RPI all items inflation, 2019-22
    • Brexit causes some inflation within the category in 2021, but less than predicted
    • Slowing inflation expected for 2023-27
    • Consumer spending power will be curbed
    • Pressure on household incomes will erode category sales
    • Retail cutbacks are expected, but gifting will continue to support sales
    • Income squeeze will continue to support the retail sector, slowing on-trade’s recovery
    • Some trading down is likely in retail
    • Premium variants could benefit from a ‘drink less but better’ mentality among consumers
    • The conflict in Ukraine will hurt the UK economy
    • Employment has held up better than expected
    • Consumers’ financial wellbeing has fallen from the highs of 2021…
      • Figure 16: Household financial wellbeing index, 2016-22
    • …and most people are feeling the effects of price rises
    • Pub closures continue in 2021 but are counter-balanced by new openings
    • Alcohol moderation trend falters but will regain momentum
      • Figure 17: Alcohol usage and reduction, 2019, 2021 and 2022
    • Ageing population will hinder category growth
  8. Regulatory and Legislative Changes

    • Changes to alcohol duty rates will increase the price barrier for spirits
    • England and Northern Ireland come under pressure to impose minimum unit pricing
    • Health organisations urge Scottish government to raise its minimum unit price
    • HFSS regulations could benefit spirits and liqueurs
  9. Market Share

    • Johnnie Walker bucks the negative trend in retail whisky sales
      • Figure 18: Leading brands’ sales and shares in the UK retail whisky market, by value and volume, 2019/20-2021/22
    • Jamesons holds its ground
    • Captain Morgan benefits from the at-home cocktails trend
      • Figure 19: Leading brands’ sales and shares in the UK retail dark/golden/spiced rum market, by value and volume, 2019/20-2021/22
    • Premiumisation trend and raised profile boost The Kraken
    • Hennessy is the only brandy/Cognac/Armagnac brand to grow retail sales in 2021-22
      • Figure 20: Leading brands’ sales and shares in the UK retail brandy/Cognac/Armagnac market, by value and volume, 2019/20-2021/22
    • Baileys outperforms the liqueurs category
      • Figure 21: Leading brands’ sales and shares in the UK retail liqueurs market, by value and volume, 2019/20-2021/22
  10. Launch Activity and Innovation

    • Limited edition dark spirit launches continue
    • Brands commemorate historical events through limited edition spirits
      • Figure 22: Examples of dark spirits launches commemorating historical events, 2022
    • Jack Daniel’s launches the first additions to its core range in 25 years
    • Low/no alcohol launches continue
    • Bacardi launches new non-alcoholic ‘spirits’ brand
    • Former MasterChef finalist launches 10% ABV ‘spirits’
      • Figure 23: DECEM spiced rum alternative with 10% ABV, 2022
    • Strykk adds non-alcoholic aperitif
    • Pernod Ricard looks to encourage responsible drinking with new labelling system
    • Dark spirits brands explore fruit and coffee flavours
      • Figure 24: Examples of fruit-flavoured dark spirits launches, 2022
    • The Famous Grouse looks to attract new users with sweeter flavour profiles
    • Flavour innovation continues in liqueurs
    • Brands and retailers continue to explore spring/summer flavours
      • Figure 25: Examples of liqueurs in spring/summer flavours, 2022
    • Niche brands explore coffee flavours
      • Figure 26: Examples of coffee liqueur launches, 2022
    • Retailers and brands look to deliver the wow factor in their 2021-22 liqueurs launches
      • Figure 27: Examples of own-label Christmas liqueur launches with edible gold or silver leaf, 2021
      • Figure 28: P31 on display at the Imbibe Live trade fair, 2022
    • Dark spirits brands take action on ethics
    • Brands continue in their efforts to reduce packaging use
    • Niche brands look to address issues around food poverty and waste
      • Figure 29: The Public Spirits’ rums on display at the Imbibe Live trade fair, July 2022
  11. Advertising and Marketing Activity

    • Advertising spend in 2021 rises above pre-pandemic levels
      • Figure 30: Total above-the-line, online display and direct mail advertising expenditure on dark spirits^ and liqueurs, 2019-22 (sorted by 2021)
    • Diageo leads on advertising in 2021
    • Johnnie Walker revives the “Keep Walking” slogan as COVID-19 restrictions ease
    • Baileys looks to appeal to young foodie audience with its latest ‘Treat Report’
    • Jack Daniels goes for multi-sensory appeal with its new cinema advert…
    • …and continues in its efforts to associate itself with popular music
    • Spiced rum brands look to raise their profile
    • The Kraken ‘attacks’ buses across the UK
      • Figure 31: London bus featuring The Kraken advertising, 2021
    • Red Leg launches its first-ever TV advert
    • Various brands promote the importance of solidarity and social connections
    • Hennessy encourages open-mindedness and story-sharing
    • Jameson celebrates true friendship
    • Tomatin focuses on the importance of family togetherness
    • Various brands use experiential campaigns to forge a lifestyle positioning
    • Jameson runs games and music events in Shoreditch
    • Ballantine’s looks to appeal to gamers with exclusive content
    • Southern Comfort celebrates Mardi Gras
    • Mount Gay sponsors the Cowes Regatta
    • Nielsen Ad Intel coverage
  12. Brand Research

    • Brand map
      • Figure 32: Attitudes towards and usage of selected brands, 2022
    • Key brand metrics
      • Figure 33: Key metrics for selected brands, 2022
    • Brand attitudes: More people are proud to be associated with Baileys than other brands
      • Figure 34: Attitudes, by brand, 2022
    • Brand personality: Baileys comes top on the fun factor
      • Figure 35: Brand personality – Macro image, 2022
    • Baileys is the most widely seen as delicious
      • Figure 36: Brand personality – Micro image, 2022
    • Brand analysis
    • Baileys is the most trusted brand
    • The Famous Grouse has something of a traditional image
    • Captain Morgan scores well on the fun factor
    • Under-35s are particularly likely to see Jack Daniel’s as fun
    • Glenfiddich has a traditional and (somewhat) sophisticated image
    • Courvoisier has a (somewhat) exclusive and connoisseur image
    • Jameson is most likely to be drunk by 18-34s, but over-55s are the most likely trust it
  13. Usage of Dark Spirits and Liqueurs

    • Nearly six in 10 adults drink dark spirits, and four in 10 drink liqueurs
      • Figure 37: Usage of dark spirits and liqueurs, by type, 2022
    • Income squeeze will erode category sales, but gifting will offer some support
    • Ageing UK population will erode category sales
    • Drinking neat has a narrow lead over other types of serve
      • Figure 38: Drinking of different serves of dark spirits and liqueurs (any), 2021 and 2022
  14. Usage Frequency for Dark Spirits and Liqueurs

    • Dark spirits and liqueurs are an occasional indulgence for most people
    • Weekly or more frequent usage is down on 2021
      • Figure 39: Usage frequency for dark spirits and liqueurs, 2021 and 2022
    • Under-45s are the most frequent drinkers
    • Further cutbacks are likely over 2022-23 amid income squeeze
      • Figure 40: Usage frequency for dark spirits and liqueurs, by how people describe their finances, 2022
  15. Barriers to Dark Spirits and Liqueurs

    • Need to highlight the range of different flavours within the category
      • Figure 41: Barriers to dark spirits and liqueurs, 2022
    • Encourage usage of dark spirits and liqueurs as a meal accompaniment
    • Promote meal pairing suggestions in-store and online
    • Take advantage of meal deals’ role in driving drinks sales
      • Figure 42: Asda in-store display promoting its ‘Dine in for Two’ meal deal at its Clapham Junction branch, 2022
  16. Behaviours Relating to Dark Spirits and Liqueurs

    • Income squeeze encourages cutbacks both for in- and out-of-home
      • Figure 43: Behaviours relating to dark spirits and liqueurs, 2022
    • Switch-and-save suggestions appeal widely
    • Smaller bottles offer multiple points of appeal
    • Pre-mixed versions can also appeal as a good value option
    • Extensions into sweet treats offer brands an additional revenue stream
      • Figure 44: Examples of sweet treat launches from Baileys, 2021-22
      • Figure 45: Elizabeth Shaw Famous Names selection of chocolates with whisky centres, 2019
    • Satisfy shoppers’ need for guidance to drive sales
    • Give recommendations based on people’s wider flavour preferences…
    • …including suggesting entry point products
    • Offer more guidance in-store
    • Incentivise user reviews to drive purchase
    • Put reviews in shoppers’ paths at the point of sale
      • Figure 46: Examples of POS display and on-shelf labelling highlighting Vivino ratings at Sainsbury’s, Didcot, 2021
  17. Interest in Innovation in Dark Spirits and Liqueurs

    • Fruit flavour notes appeal more than spice or smoke flavours
      • Figure 47: Interest in innovation in dark spirits and liqueurs, 2022
    • Pre-mixed cocktails appeal especially to under-35s…
    • …and can help brands to support sales during the income squeeze
      • Figure 48: Interest in pre-mixed cocktails made with dark spirits/liqueurs, by age group and by how people describe their household finances, 2022
    • Competition heats up in dark/golden/spiced rum-based RTDs
    • RTD brandy/Cognac/Armagnac-based cocktails warrant exploration
    • RTDs are under-explored in the liqueurs category
    • Offer pre-mixed cocktails as part of a meal deal
    • Experiment with a wider range of mixers
      • Figure 49: Examples of pre-mixed dark spirits-based cocktails, 2022
  18. Attitudes towards Dark Spirits and Liqueurs

    • Gifting will continue to support sales during the income squeeze
      • Figure 50: Attitudes towards dark spirits and liqueurs, 2022
    • Smaller formats can appeal as a good value gift option
    • Combination gifts help to elevate the everyday
    • Put the focus on packaging aesthetics
      • Figure 51: In-store display of Johnnie Walker with gift bag at Sainsbury’s Didcot, June 2022
    • Explore gift formats that are both aesthetically pleasing and environmentally friendly
    • Brands must continue in their efforts to target seasonal occasions
    • Less sweet liqueurs warrant further exploration
    • Lower-sugar liqueurs should appeal to many
      • Figure 52: Baileys’ lower-sugar, lower-calorie variant, 2021
    • Opportunities to boost sales of bitters
  19. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  20. Appendix – Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 53: Market forecast and prediction intervals for total value sales of dark spirits and liqueurs, 2017-27
      • Figure 54: Market forecast and prediction intervals for total volume sales of dark spirits and liqueurs, 2017-27
    • Market drivers and assumptions
    • Forecast methodology
  21. Appendix – Market Share

      • Figure 55: Leading brand owners’ sales and shares in the UK retail whisky market, by value and volume, 2019/20-2021/22
      • Figure 56: Leading brand owners’ sales and shares in the UK retail dark/golden/spiced rum market, by value and volume, 2019/20-2021/22
      • Figure 57: Leading brand-owners’ sales and shares in the UK retail brandy/Cognac/Armagnac market, by value and volume, 2019/20-2021/22
      • Figure 58: Leading brand owners’ sales and shares in the UK retail liqueurs market, by value and volume, 2019/20-2021/22
  22. Appendix – Usage of Dark Spirits and Liqueurs

      • Figure 59: Usage of dark spirits, by type, by serve, 2022
      • Figure 60: Usage of liqueurs and flavoured dark spirits, by type, by serve, 2022

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