BeverageTrak data shows over the latest year* all Spirits categories have seen an increase in average price. Cordials (cream and non-cream liqueurs, Cocktail ingredients, shot brands, etc) have had the biggest uplift (up +$1.00), with each category having had median prices at least $0.60 higher than last year, showcasing how inflation and price increases have affected the On Premise Spirits industry.
Ranking across Spirit categories has stayed consistent, with the exception of Tequila which has overtaken Whiskey as the second-highest median price of all categories (down to a $0.99 uplift last year)*. Cognac continues to have the highest prices, increasing to $14.00 on average in 2023.
When exploring Beer, all subsegments experienced an uplift in median price vs 2022, with Below Premium seeing the greatest increase (up +$0.86), and Hard Seltzer and Domestic Premium having the smallest change (up +$0.15 and +$0.13 respectively).
While the rank of each Beer category remained largely unchanged in 2023, Below Premium overtook Domestic Premium with a slightly higher median price ($5.16 vs $5.13 respectively).
Performance of price bands
CGA by NIQ data explores how each category performs when priced at different amounts by grouping sales into price bands. In 2022, Cordials earned the highest velocities at the mid-price band, whilst this year they earned the average outlet the most in the high price band – highlighting a shift in preferences, as premium options are becoming more favourable amongst consumers.
Gin experienced opposite trends, performing better in the mid-price band than the high, in contrast to last year. However, velocity for Gin in the high price band was up +24% vs 2022. Vodka saw similar trends as velocity in the high-priced band this year outperformed the low by +80%, reinforcing the fact consumers are willing to spend more on premium options and showing that brands are earning the average outlet more when sold at higher prices.
Most Beer subsegments continue to perform best at the low-price band, while Imported Beer and Cider performed better in the mid-price band. Highlighting how consumers who are more inclined to drink imported Beer and Cider are more willing to pay extra.
Below Premium experienced the greatest uplift in low price band and saw velocity up +135% vs 2022, showing how consumers are less influenced by quality, and more by price when it comes to Beer.
Eating vs drinking outlets
Eating outlets are performing better in the high price band vs last year, with all Spirit categories seeing an increase in velocity. The biggest increases are seen within Cognac (up +132%) and Vodka (up +72%). Drinking outlets are also performing better overall in the high price band, except for Vodka, although the mid-price band is now less lucrative than before for each category. Drinking outlets tend to fare better than eating in the high price band, especially for Whiskey (+296% eating vs drinking) and Rum (+193% eating vs drinking), whilst the low and mid-price bands are variable by category.
When it comes to Beer, eating outlets saw an increase in median price vs last year, with all beer categories experiencing an uplift. However, drinking outlets earned more than eating outlets on average, with Domestic Premium generating the most sales in an average outlet, where both high price and low-price bands performed better than 2022 (+159% and +66% respectively). Import is the only category performing best in the high price band, seeing an increase of +3% vs last year, again reinforcing how the Imported Beer consumer are much more willing to pay extra.
Matthew Crompton, regional director – North America said: “It’s important for brands, suppliers and operators to monitor how the On Premise landscape is changing, especially whilst navigating cost of living pressures across the country. This BeverageTrak data is crucial for those looking to keep a pulse on how consumers are navigating the On Premise, and how best to position products to appeal to consumers who are considering their purchasing decisions much more carefully.”
CGA by NIQ’s Pricing Analytics, powered by BeverageTrak, can examine the price and velocity of brands and products across all markets and channels informing suppliers where and at what price range their products are under or overperforming compared to their competitors.
For more information on how pricing analytics can support your brand and On Premise strategies, email Matthew.firstname.lastname@example.org.
*Last 12 weeks to 06/17/2023
**Last 12 weeks to 08/20/2022