Whiskey Market

Market Overview

The global whiskey market size was valued at USD 62.25 billion in 2023. It is estimated to reach USD 101.47 billion by 2032, growing at a CAGR of 5.58% during the forecast period (2024–2032).  The consumption of whiskey cannot only be attributed to prestige and honor, but it also has several health benefits. These factors are expected to boost the global whiskey market. In addition, an extensive range of whiskey available through e-commerce channels is further expected to drive the global whiskey market. Moreover, the major market participants are engaging in innovation by creating novel flavor profiles and incorporating flavored variants of whiskey, which is expected to create opportunities for market expansion.

Whiskey is a globally regulated spirit that encompasses numerous classes and varieties. Whiskey is an alcoholic beverage that undergoes distillation and is commonly derived from grain mash fermentation. The ingredients used in its production often encompass a variety of grains, like barley, corn, rye, and wheat. The utilization of certain grains and the intricacies of the production process are influential factors that lead to the discernible flavor profiles exhibited by various whiskey varieties.

Whiskey is commonly subjected to maturation in wooden casks, predominantly crafted from charred white oak. Various whiskey categories exist, encompassing Scotch whisky, Irish whiskey, Bourbon, Rye whiskey, and other variants, each distinguished by specific production regulations and distinctive attributes. The selection of grains, the distillation methodology, and the conditions under which aging takes place collectively contribute to the wide array of flavors observed in different types of whiskies across the globe.

Highlights

• Malt whiskey dominates the product type segment.
• Super-premium whiskeys dominate the quality type segment.
• Liquor stores dominate the distribution channels.
• Europe is the highest shareholder in the global market.

Market Dynamics

Whiskey Market Drivers

Availability of Whiskey through E-Commerce Platforms

E-commerce platforms offer unparalleled convenience to consumers, allowing them to peruse a vast selection of whiskey from around the world without leaving their homes and with just a few clicks. This convenience especially appeals to those who lack easy access to brick-and-mortar wine stores and specialty shops. In addition, online whiskey retailers typically offer a larger and more diverse selection of whiskey than brick-and-mortar stores.

Additionally, e-commerce platforms frequently provide comprehensive product descriptions, customer reviews, and ratings. Even if they are not whiskey experts, this information allows consumers to make wise decisions about their whiskey purchases. It increases transparency and assists consumers in selecting whiskey that corresponds to their tastes and preferences. Similarly, according to a recent analysis published by IWSR Drinks Market Analysis, there was a substantial growth of almost 43% in the worldwide e-commerce market for spirits and wine between 2019 and 2020. This indicates a surge in the sale of whiskey, thereby boosting the market expansion.

Potential Health Benefits of Whiskey

The increasing awareness of whiskey's nutritional value and health benefits, which include its use as a remedy for allergies such as the flu and colds, is driving its global demand. Whiskey is also gaining recognition among women worldwide due to its minimal or nonexistent sugar composition.

Obesity has led to the consumption of low-sodium, fat-free whiskey, which has effectively reduced weight gain. As diabetes becomes more prevalent worldwide, whiskey's ability to reduce insulin levels and prevent the onset of the disease becomes increasingly important. Similarly, the cancer-preventing properties of whiskey have been attributed to its ellagic acid, which can absorb malignant cells within the body. Such advantages are anticipated to drive the global market.

Whiskey Market Restraint

Growing Demand for Non-Alcoholic Beverages

The prevalence of non-alcoholic beverage consumption is experiencing an upward trend among consumers, particularly in nations such as France, the United Kingdom, Germany, Spain, and Canada, due to an increasing awareness of health-related concerns. People are trying to cut back on alcohol consumption and switch to healthier beverages like enriched water due to the growing prevalence of obesity and other diseases linked to lifestyle choices.

This shift in consumer preferences can impede the overall growth of alcoholic beverages and thus affect the whiskey market. According to data presented by the CDC, there has been a substantial increase in the prevalence of obesity in the United States. The rates have shown a substantial escalation, rising from 30.5% in the year 2000 to 42.4% in the year 2018. Thus, all these factors are estimated to restrain the global whiskey market.

Whiskey Market Opportunities

Introduction of Flavored Whiskey

The key players in the market are innovating with new flavors and introducing flavored whiskeys. For instance, in June 2023, Crown Royal, a renowned whisky brand, established a comprehensive and impactful collaboration with Solange Knowles, a multidisciplinary artist, for the Saint Heron project. This cooperation aims to unveil Crown Royal's latest limited-time product, the Crown Royal Golden Apple Aged 23 Years. The introduction of Crown Royal Golden Apple is a novel addition to the luxury-flavored whisky market, aiming to disrupt traditional notions of prestige and redefine customer perceptions in this category.

Additionally, in April 2023, Elvis Whiskey introduced 'Midnight Snack,' a whiskey flavored with peanut butter, banana, and bacon, in honor of the rock 'n' roll icon's preferred decadent sandwich. The inspiration behind 'Midnight Snack' was Elvis Presley's preferred late-night snack, a peanut butter, banana, and bacon sandwich, which gained significant popularity. This flavor amalgamation is an exquisitely harmonized fusion of piquant, salty, sweet, and smoky elements. Such launches are expected to create opportunities for market expansion.

Regional Analysis

Based on region, the global market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

Europe Dominates the Global Market

Europe is the most significant global market shareholder and is expected to expand substantially during the forecast period. The consumption of whiskey in Europe is deeply ingrained in culture and history. For instance, whisky-producing nations such as Scotland and Ireland are internationally renowned, and their traditional distilleries have earned the respect and allegiance of consumers around the world. Similarly, European consumers possess a profound admiration for craftsmanship and superior quality, attributes consistent with whiskey's qualities. The European market is also recognized for its refined and discerning clientele who place a premium-on-premium spirit. The preference for premium products and the readiness to incur additional costs in exchange for authenticity and heritage have both played a role in the European whiskey market's dominance.

Furthermore, the key players are collaborating with the retail industry to introduce premium quality whiskeys. For instance, in April 2023, Midleton, an Irish distillery, introduced four single-cask whiskey releases from its Very Rare collection for sale in travel retail. The introduction of the 27-year-old First-Fill Bourbon, 21-year-old Virgin American Oak, 25-year-old Virgin American Oak, and 24-year-old First-Fill Bourbon has been announced by Pernod Ricard Global Travel Retail (GTR) at multiple European airports. Thus, such factors are estimated to drive regional market expansion.

In North America, the primary aspects driving the market include the swift evolution of consumer lifestyles, increased disposable income, and increased demand for whiskey products among the younger demographic. Similarly, the substantial increase in the proliferation of nightclubs, pubs, restaurants, and distilleries worldwide is a significant driving force behind the market expansion. For instance, in 2021, the bar and nightclub sector in the United States witnessed a notable rise, reaching roughly 68,000 establishments. This figure signifies a growth compared to the preceding year.

According to projections, the industry is anticipated to grow, reaching an estimated count of 72 thousand businesses by 2022. The shift in consumer tastes towards premium products has prompted individuals to seek out high-quality and distinctive alcoholic beverages, such as whiskey and wine, among other options. Additionally, the key players in the region are expanding their product portfolio. For instance, in November 2023, Varchas Spirits, a distinguished American brand of premium spirits, was introduced in Texas. Varchas Spirits presently comprises three distinct offerings in the bourbon and whiskey category: Varchas Straight Bourbon Whiskey, Varchas Reserve 102 Straight Bourbon Whiskey, and Varchas Straight Rye Whiskey. Consequently, all these factors are estimated to boost the regional market growth.

Segmental Analysis

The global whiskey market is segmented by product type, quality type, and distribution channel.

Based on product type, the global whiskey market is divided into malt whiskey, wheat whiskey, rye whiskey, corn whiskey, blended whiskey, and others.

Malt whiskey dominates the product type segment. Malt whiskey is a type of whiskey made from malted grains, most notably barley, and is known for its rich, smooth flavor and complex character. Its market position is built on a number of factors, including its long history and cultural significance, high-quality production processes, and strong brand recognition. It is made by malting grains, which are soaked in water to activate enzymes that break down starches into fermentable sugars. The grains are then fermented and distilled to create the finished product. Malt whiskey's popularity stems from its rich flavor profile, which is influenced by factors such as grain type, aging process, and region of production. The versatility and various ways in which malt whiskey can be consumed contribute to its market dominance. Malt whiskey can be enjoyed on its own or added to cocktails and other mixed drinks. Furthermore, the growing trend of whiskey tourism, as well as the popularity of whiskey tastings and tours, have aided the growth of the malt whiskey market.

Based on quality types, the global whiskey market is bifurcated into premium, high-end-premium, and super-premium whiskeys.

Super-premium whiskeys dominated the quality type segment. Whiskeys deemed of the utmost quality and routinely command premium prices on account of ingredients, production method, maturing period, and distillery reputation are typically referred to as "super-premium whiskeys." Whiskeys of this quality are frequently produced with careful consideration for every aspect, employing premium ingredients and maturing for prolonged durations in meticulously chosen casks. The designation "super-premium" may comprise a wide range of whiskey varieties, such as bourbon, Scotch, rye, and other variants. The objective is to provide a beverage experience that is regarded as exceptional and unique. In addition, the key players in this segment are involved in strategic initiatives, thereby boosting the segment's expansion. For instance, in March 2023, Pernod Ricard USA and Skrewball, the inaugural super-premium peanut butter-flavored American whiskey, announced the execution of an agreement to acquire a majority stake in Skrewball.

Based on distribution channels, the global whiskey market is divided into bars and restaurants, liquor stores, supermarkets, e-commerce, and hypermarkets.

Liquor stores dominate the distribution channels. Liquor stores have established themselves as the primary distribution channel for whiskey due to their ability to provide a diverse range of products, personalized service, and a focus on whiskey enthusiasts. These stores typically stock a wide range of whiskey brands, from premium to super-premium, to cater to the preferences of different consumer segments. Liquor stores' dominance stems from their ability to provide a curated shopping experience for whiskey enthusiasts. These stores frequently employ knowledgeable employees who can walk customers through the selection process, making recommendations based on their individual tastes and preferences. This personalized service increases customer loyalty and encourages repeat business. Furthermore, liquor stores have developed strong relationships with whiskey producers and distributors, enabling them to obtain exclusive products and limited editions. This exclusivity appeals to whiskey enthusiasts and collectors, who are willing to pay high prices for rare and unique offerings.

Recent Developments

• May 2024- Jagatjit Industries is set to launch a single malt whisky next year, adding to the diversity of the global whiskey market.
• May 2024- Speyburn, a Scottish distillery, has launched a brand refresh and introduced two new whiskies, expanding the global whiskey market. The brand refresh aims to appeal to a wider audience, while the new whiskies, Speyburn 10-Year-Old and Speyburn 12-Year-Old, offer unique flavor profiles. This move reflects the market's growth, driven by consumer interest in premium and diverse whiskey offerings.