In a special webinar, ‘Detecting Drivers Behind Growth Categories in the Alcohol Industry’, NIQ’s Jon Berg and Kaleigh Theriault shared ten big insights from their suite of research sources to help suppliers and operators perfect strategies.
1 Fast-growing sales
It’s been a strong 12 months for the US On Premise, with total alcohol sales up 18% from the previous 52 weeks. Sales velocity has outperformed 2022 in every week of 2023 so far, and the outlet universe is growing too. But tequila, with 23% growth by value, has had an even better time, gaining share from other categories like beer and wine. Off Premise growth has been more modest at 7%, but it now accounts for 13% of all spirits spending there.
2 Experimentation
CGA by NIQ data shows nuances in sales of tequila sub-categories, and an appetite among consumers for experimentation with new taste profiles. Segments including white silver, reposado and mezcal have increased share, but others like gold and anejo are slightly down. Innovative varieties like Cristalino are growing more popular too. This trial in bars and restaurants also influences purchases in the Off Premise.
3 Premiumisation
Tequila’s value growth is comfortably exceeding volume—a sign that the premiumisation trend continues. Sales in the premium and ultra-premium segments have grown share in the On Premise over the last year, at the expense of value and mid-level brands, partly because they’re being heavily used in cocktails now.
4 Ready to drink
The boom in RTDs goes on. Tequila-based RTDs now account for 16% of total spirits RTDs, and dollar sales have rocketed 44% in the last 52 weeks. Tequila is still behind vodka, but the gap is closing.
5 Cocktails
Cocktails have been another big reason for tequila’s success story. Canned Margaritas are by far the most popular option, followed by juice cocktails and variety packs. Tequila has the biggest share of all cocktail bases—more than a third (35.9%) in 2022.
6 Demographics and occasions
Tequila drinkers tend to be younger and more active in the On Premise than average. Nearly half (47%) drink out weekly—twice the average of all On Premise users (25%). The most popular tequila drinking occasions are catch-ups with friends and celebrations, and 10pm+ is the most popular daypart.
7 Channels
It’s vital that suppliers understand the shifting channels of tequila purchases. Growth is currently fastest in bars and nightclubs, and better in casual dining restaurants than fine dining. In the Off Premise, liquor and convenience channels lead growth.
8 Purchase drivers
Deals and discounts can be powerful drivers of spending. The top two factors are price deals and happy hours, which influence 31% and 28% of consumers respectively. But with 80% of all tequila purchases planned rather than reminded or impulse buys, many drinkers have pre-determined their selections.
9 Non-alcoholic tequilas
The market for non-alcoholic tequila alternatives remains very small for now, but from a low base there was 231% growth in the last 52 weeks. As interest in health, wellness and alcohol moderation continues, interest is likely to grow.
10 The role of Influencers
Celebrities and influencers have an increasingly important role in brand choice. A modest 7% of consumers say they are influenced by celebrities’ endorsements or brand ownership—but of these, 82% would drink another category or brand if they like the celebrity behind it. This translates into Off Premise purchases too.
Click here to watch a full replay of the webinar.
NIQ and CGA’s unrivalled range of sales measurement and consumer research services unlocks actionable insights into these and many more aspects of the tequila category. Deep dives are available into all segments of the BevAl industry in the US On and Off Premise. To learn more, contact Drew Hummel, CGA by NIQ client director for North America, at andrew.hummel@cgastrategy.com.
