US spirits polarize as value brands drop and premium segments gain share

Those are among the findings in CGA by NIQ’s exclusive new On Premise Measurement (OPM) Impact Report. It indicates a 3.3% drop in spirits sales by value in the 2023 calendar year and a 6.5% dip in volume. 

CGA by NIQ’s research uncovers variations in sales by sub-categories that can help suppliers and venues to optimize their range. It shows sales by volume of spirits in the value tier fell by 12.3% from 2022, while mid-range options dropped 8.5%.

However, premium spirits brands proved more resilient. Premium and super-premium sales were down by only 3.6% and 5.0% respectively, while spirits in the ultra-category lost just 1.5% of volumes year-on-year.

CGA’s OPM service delivers further breakdowns of performance across spirits by segment, state, and much more. The best-performing spirit price segment in 2023 was ultra-priced tequila, where sales by value grew by 2.5% and distribution points increased by 10.6%.  

OPM also highlights pockets of growth in some US states in 2023—including New York and Illinois, where sales by value rose 1.0% and 2.3% respectively. However, trading was more muted in other major states like California and Texas, where sales dropped 4.7% and 4.4%.

Matthew Compton, CGA by NIQ’s regional director – North America, said: “The spirits category in the US On Premise continues to polarize, with some consumers spending freely while others restrict their visits out. We’re seeing the greatest resilience at the premium end of the market, and with so many drinkers willing to trade up we can expect premiumization to remain relevant, benefiting the ultra-priced segment in 2024. Lower–price tiers are more challenging, but there is still growth potential for suppliers that can understand consumers’ need for value and position their value brands correctly. Identifying and responding to the subtle but significant differences in people’s preferences is going to be key to protecting sales and share, and the CGA by NIQ team are ready to help all businesses stay ahead of the curve.”

To discover more about CGA by NIQ’s On Premise Measurement solution, along with expert support for understanding trends at category, segment and brand level within the US On Premise, contact Matthew Crompton at matthew.crompton@nielseniq.com or visit  https://cgastrategy.com/unlock-the-potential-of-opm.