RTD Spirit Market

• Growing Innovations by Key Players

The growing consumption of RTD spirits such as rum, whiskey, and vodka among various consumer groups such as Gen X, Gen Z, millennials as well and baby boomers have compelled manufacturers to come up with a wide range of products which in turn would fuel its market growth in the upcoming years. As a part of this, in May 2023, Urban lifestyle brand Salud intends to introduce new spirit-based ready-to-drink (RTD) products in ten additional Indian locations, with a USD 1.5 million investment.

Karnataka, Goa, Telangana, Maharashtra, Orissa, Pondicherry, Kerala, Punjab, Uttar Pradesh, and Chandigarh are among the main Indian states where the brand hopes to create a strong presence. Salud is catering to a diverse variety of consumers by focusing on both smaller and major states, delivering its upscale lifestyle and goods to a large audience. Moreover, in the upcoming months, the company will launch premium gin and Salud Bitters on the Indian market. The business claims that in the previous fiscal year, it sold 30,000 cases, each comprising 24 bottles, to the RTD market only.

In addition, the company is introducing three new SKUs based on various spirits to broaden its product selection and satisfy a wider spectrum of consumer tastes. In August 2023, Double Dutch, in collaboration with the beverage business John Paul Jones Rum (JPJ) released its first ready-to-drink (RTD) canned cocktail. With JPJ's dark and dry Lowland Rum and Double Dutch's Cucumber and Watermelon mixer, the RTD cocktail is a light, energizing rum-based concoction that comes in a 250ml container. It is a 4.5% ABV and provides a fruity, low-calorie beverage that is perfect for picnics, BBQs, and drinking with friends.

Hence, the growing innovation by key players to cater to the various consumer groups is likely to increase the demand for RTD spirits in the upcoming years.

The Global RTD Spirit Market Industry is poised for remarkable growth, with projections indicating a market size of 3.45 USD Billion in 2024 and an anticipated expansion to 105.6 USD Billion by 2035. This trajectory suggests a robust compound annual growth rate (CAGR) of 36.49% from 2025 to 2035, highlighting the increasing popularity of ready-to-drink spirits among consumers. Factors contributing to this growth include rising consumer demand for convenience, innovative product offerings, and the influence of e-commerce. As the market evolves, stakeholders must remain agile to adapt to changing consumer preferences and capitalize on emerging trends.

The Global RTD Spirit Market Industry experiences a notable surge in consumer demand for convenience-driven products. As lifestyles become increasingly fast-paced, consumers gravitate towards ready-to-drink options that offer both quality and ease of consumption. This trend is particularly evident in urban areas where busy professionals seek quick yet enjoyable beverage choices. The market is projected to reach 3.45 USD Billion in 2024, reflecting a growing preference for RTD spirits over traditional options. This shift indicates a potential for brands to innovate and cater to the evolving tastes of consumers, thereby enhancing their market presence.

The Global RTD Spirit Market Industry benefits significantly from the rise of e-commerce and digital marketing strategies. As online shopping becomes more prevalent, brands leverage digital platforms to reach a broader audience and enhance consumer engagement. This shift allows for targeted marketing campaigns that resonate with specific demographics, particularly younger consumers who are more inclined to shop online. The convenience of purchasing RTD spirits through e-commerce channels is likely to bolster sales and expand market reach. As brands adapt to this digital landscape, the industry is poised for substantial growth, aligning with the overall market trajectory.

Regulatory changes play a crucial role in shaping the Global RTD Spirit Market Industry, influencing product availability and market accessibility. As governments adapt their policies to accommodate the growing demand for RTD spirits, brands may find new opportunities for expansion. For instance, relaxed regulations regarding alcohol sales in various regions could facilitate market entry for emerging brands. This evolving regulatory landscape may encourage innovation and competition, ultimately benefiting consumers with a wider array of choices. The industry must remain vigilant in navigating these changes to capitalize on potential growth opportunities.

The Global RTD Spirit Market Industry witnesses a growing trend towards health consciousness among consumers, prompting brands to develop low-alcohol and healthier alternatives. As individuals become more aware of their dietary choices, there is a noticeable shift towards beverages that offer lower calorie counts and natural ingredients. This trend is particularly appealing to health-focused demographics, including younger consumers who prioritize wellness. The introduction of low-calorie RTD spirits aligns with this demand, potentially contributing to the market's anticipated CAGR of 36.49% from 2025 to 2035. This focus on health may redefine consumer expectations and influence purchasing decisions.

Innovation plays a pivotal role in the Global RTD Spirit Market Industry, as brands continuously introduce unique flavor profiles and diverse product offerings. The incorporation of exotic ingredients and artisanal methods appeals to adventurous consumers seeking novel experiences. For instance, the introduction of botanical-infused spirits and craft cocktails in convenient formats has captured the attention of millennials and Gen Z. This trend not only enhances consumer engagement but also drives sales growth, as evidenced by the projected market expansion to 105.6 USD Billion by 2035. Such innovation is likely to create a competitive landscape that encourages further exploration of flavors.

By Region, the study segments the market into North America, Europe, Asia Pacific, South America, and the Middle East & Africa. North America RTD Spirit market accounts for the largest market share 40.45% in 2022 and is expected to exhibit a 33.80% CAGR due to its robust cocktail culture and the quick implementation of convenience-oriented alcoholic beverages, particularly among younger customers. Europe accounts for the second largest market share in RTD Spirit Market. Which is driven by a rich tradition of alcohol consumption combined with a growing interest in ready-to-eat beverages with lower alcohol content.

The territory and strict focus on quality combined with a strong regulatory framework supporting the craft and premium segments will further strengthen its dominant position in the RTD spirit market. As a key player in the global RTD Spirit industry, North America has witnessed a surge in the production and consumption of RTD spirits. Further, US RTD Spirit market held the largest market share, and the Canada RTD Spirit market was the fastest-growing market in the North America region.

Further, the major countries studied are The U.S., Canada, Germany, France, Northern Africa, the UK, Italy, Spain, China, Japan, India, Australia & New Zealand, and Brazil.

Figure 3: RTD SPIRIT MARKET SHARE BY REGION 2022 (%)

Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

The North America RTD Spirit market stands as a dynamic and evolving sector, poised for continued expansion and revolution. This is because consumer tastes and lifestyles are changing. This changing environment is being shaped by several important trends. The growing focus on health and wellness is one of the most important trends in the RTD Spirits business in North America. People are becoming more health-conscious and looking for choices with less sugar, fewer calories, and natural ingredients. As a result, the number of "better-for-you" RTD Spirits being made and drunk is on the rise.

Brands are responding to health-conscious customers by making products with less sugar, organic ingredients, and clear nutritional information. The rise of homemade and artisanal RTD Spirits is another interesting trend. Consumers who know what they want are looking for unique choices that are made or sourced locally and show craftsmanship and authenticity. Craft distilleries are becoming more popular because they make RTD Spirits in small batches or by hand, giving them unique tastes and qualities that set them apart from mass-produced options.

This is part of a larger effort to support local businesses and appreciate the work that goes into high-quality goods. The North America RTD Spirit market comprised of the US, Canada, & Mexico, among which the US emerged as the frontrunner with a market share of 73.26% in 2022.

The Asia-Pacific RTD Spirit market is expected to grow at the highest CAGR of 38.12% from 2022 to 2032. The Asia-Pacific RTD (Ready-to-Drink) Spirits market is dynamic and changing quickly, driven by unique trends, drivers, and a lot of possibilities. People want more than just a drink; they want events that are immersive and memorable. Because of this trend, a lot of new RTD products have come out that aren't like standard cocktails. Brands are trying out things like interactive packaging, virtual reality labels, and partnerships with mixologists to make an experience that goes beyond just drinking the drink.

The trend of adding local flavors and ingredients to RTD Spirits shows how different Asia Pacific's food culture is. People are drawn to goods that taste real and show off the wide variety of flavors that are found in the area. Local herbs, spices, and veggies are being used by brands to make their products more appealing to local tastes. This trend fits with the growing pride in regional identity and the desire to help local communities.

People who care about their health are changing the market by choosing wellness-focused RTD Spirits. Products that have less alcohol, less sugar, and natural chemicals are becoming more popular. This trend reflects the global change towards more conscious consumption and the desire to live a healthy life without giving up taste and enjoyment. Sustainability is becoming an important part of the RTD Spirits business in Asia and the Pacific. Consumers are becoming more interested in brands that care about the environment by doing things like finding ingredients responsibly and using packaging that can be recycled.

The European RTD Spirit market is changing quickly because customer tastes are changing, and new brands are becoming more popular. Several major trends are changing the way this market, which is always changing, looks. The growing focus on health and fitness is a major trend in the RTD Spirit market in Europe. As people become more health-conscious, they want choices with less sugar, fewer calories, and more natural ingredients. Brands are quick to react with "better-for-you" RTD spirits, making products with less sugar, organic ingredients, and clear nutrition labels.

This trend shows that people want to enjoy themselves without putting their health at risk. Another interesting trend is that RTD Spirits are becoming more expensive. Europeans who know what they want are drawn to high-quality, handmade, and artisanal choices. Craft breweries are becoming more popular. They make RTD Spirits by hand in small batches with unique flavors and high quality. This is part of a larger movement towards appreciating the work that goes into high-quality goods and supporting local businesses, especially those with a strong regional impact.

The South American RTD Spirit market is a fascinating mix of rich traditions, changing consumer tastes, and promising prospects. The praise of local flavors and ingredients is one of the most noticeable trends in the South American RTD Spirit market. South America's varied and rich settings are home to many different herbs, fruits, and other plants. Brands are taking advantage of this abundance by giving their RTD goods a local feel. People like this trend because it gives them a taste of custom and lets them learn about the culinary history of the continent.

Craft and handmade RTD Spirits are becoming more and more appealing to people in South America. Small-batch, hand-made goods are becoming more popular because more people value quality and originality. Craft breweries are becoming more common. They make RTD Spirits with unique tastes and a strong sense of place.

The Middle East and Africa (MEA) region has witnessed a notable evolution in its RTD Spirit market, which is a mix of old customs, new ideas, and unrealized promises, the key drivers, and the promising growth paths. The celebration of tradition and authenticity is one of the most important trends in the Middle East and Africa RTD Spirit market. People in the area want to buy things that are in line with their culture and customs. As a result, brands are adding local flavors, spices, and ingredients to their RTD products to pay homage to the local food culture.

This trend draws people who want to feel like they're back in the past. The number of people in the Middle East and Africa who want luxury and craft RTD Spirits is growing. Consumers who know what they want are looking for small-batch, high-quality goods that show craftsmanship and attention to detail. Craft breweries are becoming more popular because they make RTD Spirits with unique flavors and a strong sense of place. This trend fits with the way people in the area value quality and like to use traditional ways to make things.

Market leaders in the global RTD Spirit sector are at the forefront of adapting to the evolving landscape, employing a spectrum of strategies to meet dynamic consumer demands and sustain a competitive edge. The key factors driving the growth of the RTD spirit market include the increasing consumption of alcohol coupled with the growing innovations by key players. However, the fluctuating prices of raw materials are expected to restrict the market's growth during the forecast period.

Furthermore, the growing investment by major players as well as increasing strategies adopted by key players are anticipated to create growth opportunities for the market. The global RTD spirit market is highly competitive, with the established players adopting various strategies such as product launches, subsidiary launches, and brand launches to segment and product launches to bolster the product portfolio and distinguish themselves from their peers in the competition landscape. To strengthen the distribution channel and boost the market share, the companies are constantly looking for companies to acquire and channel the distribution channel by renewing and innovating with in-house distribution.

Most of the companies in the market are expected to enter into a strategic partnership with leading cocktail brands to create fusion products and develop innovative product offerings in the coming years. Another form of partnership that is expected to gain importance in the forecast period is the partnership with popular artists in the entertainment media and social media influencers to gain a considerable consumer base in the long term.

The growth of the market players in the global RTD spirits space is dependent on various factors including market conditions, disposable income of individuals, growth of the working population, inflation, and industry development.