Alcoholic Beverage Category Trends 2021

How many of us are drinking alcohol?

According to Gallup, 65% of U.S. adults age 18 and older had "occasion to use alcoholic beverages such as liquor, wine or beer" in 2019. Since data were first recorded in 1939, this percentage has ranged between 56 and 71%. The average number of alcoholic drinks consumed during a week was 4.0, which is slightly lower than the number Gallup recorded for the period of 2002 to 2010 (4.6 drinks per week), but higher than the number for the period of 1996 to 2001 (3.4 drinks per week).

Other 2018 data, as reported by the National Center for Health Statistics, indicates that, with 34% of consumers reporting that they did not drink in the past year, others were categorized as:

• light weekly drinkers (three or fewer drinks per week), 46%
• moderate weekly drinkers (four to seven drinks per week for women and four to 14 drinks per week for men), 16%, and
• heavy weekly drinkers (more than seven and 14 drinks per week for women and men, respectively), 5%.

Data published by the Wine Market Council, collected in June 2019, for adults age 21 and older revealed that:

• 75% of participants drank alcohol, even if consumption was "infrequent" and "less than every 2-3 months."
• Eighteen percent of iGen (a.k.a. Generation Z, born between 1997 and 2012) did not consume alcohol, which is a lower percentage than Baby Boomer participants (31%, born between 1946 and 1964) and those in the Silent Generation (37%, born between 1928 and 1945).

Due to the COVID-19, 28% of adults who drink alcohol indicated that their consumption increased. In fact, between 2019 to August 2020, consumption frequency for all generations:

• Gen Z, an increase of 25%
• Millennials (born between 1981 and 1996), 28%
• Gen X (born between 1965 and 1980), 29%
• Baby Boomers and older consumers, 4%

What alcoholic beverages are consumers drinking?

According to Silicon Valley Bank's 2020 State of the Wine Industry report, based on data from the Nielsen Homescan Panel (52 weeks ending June 29, 2019), for those who consumed alcohol:

• 72% of panelists drank beer (including flavored malt beverage and ciders)
• 68% drank wine
• 48% drank spirits

When segmented based on which beverages participants consumed:

• 18% drank beer exclusively
• 15% drank wine exclusively
• 6% drank spirits exclusively

• 19% drank beer and wine
• 8% drank beer and spirits
• 7% drank wine and spirits

• 27% drank beer, wine, and spirits

In 2017, Nielsen collected data from Younger Millennials (ages 21 to 29 in 2017) and Older Millennials (ages 30 to 39) about what alcoholic beverages they selected "most often." The data was presented using an index level and showed that for both cohorts, the indexes for beer, cider, and spirits were greater than 100, while wine was below 100. Of these beverages, the index for cider for Younger Millennials was 208, meaning that these survey participants were 108% "more likely than adults 21+" to select the beverage. The index for cider for Older Millennials was lower, at 145. The index for beer for older Millennials was higher, 125, than for Younger Millennials, 116.

The beer category

 While the percent of consumers who responded that they drank beer is higher than those who consume wine and spirits, the beer category includes data for hard ciders, hard seltzers, and other products listed below. Data published at the end of 2020 shows that certain beer subcategories garnered more consumer attention than others. The percent off-premise dollar sales increase for select alcoholic beverages in the beer category for the 52-week period ending December 27, 2020, were:

• Domestic beer, 6.9%
• Hard cider, 11%
• Imported beer, 12.7%
• Craft beer, 13.9%
• Non-alcohol beer, 37%
• Flavored malt beverages: hard seltzers, hard lemonade, hard kombucha, etc. 68.2%

Hard seltzers

"The global hard seltzer market size was valued at USD 4.4 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 16.2% from 2020 to 2027. Rising demand for drinks that are gluten-free and low ABV content in the developed economies including the U.S., Australia, and South Korea, has created a great opportunity for the market."

One of the reasons why the growth in hard seltzers has been so impressive, according to Brian Sudano, managing partner for New York-based Beverage Marketing Corporation (BMC), as quoted in a BevIndustry.com article, is because the "focus is on lower calories and lower carbs, a better-for-you alternative" to other alcoholic beverages.  Other sources cite that they are also popular because they are "packaged in cans, they are portable and recyclable."

While two brands account for 75% of the seltzer market, lesser-known brands are focusing on positioning themselves by developing products made with "fresh ingredients," "100% real fruit," and "seasonal releases." In early 2021, Michelob released the first national USDA certified organic hard seltzer that "contains zero carbs, zero sugar, 80 calories and is filtered six times to remove impurities."

While these beverages are often associated with "younger" drinkers, half of the category growth is due to consumers ages 35-54, Older Millennials and younger Generation X.

The Sprits Category

Based on data for the 52-week period ending November 29, 2020, off-premise dollar sales for spirits experienced double-digit off-premise dollar sales growth, 28.7%, with data for individual spirits:

• Pre-mixed cocktails, 45.6%
• Tequila, 25.1%
• Non-alcohol mixes, 15.3%
• Whiskey, 15.2%
• Cordials, 13.4%
• Gin, 12.7%
• Brandy/cognac, 10.6%
• Vodka, 9.7%
• Rum, 7.6%

Cocktails

What are the best-selling cocktails in the U.S.? These are, in order of ranking:

• Margarita
• Martini
• Old Fashioned
• Mimosa
• Moscow mule

Additionally, consider the characteristics that Beverage Daily released in their predictions for trends for "2020 and Beyond," which highlighted flavors, colors, and textures (Newhart, 2020):

Flavors

• Botanicals (basil, cilantro, lavender, sorrel, and orange peel), 
• citrus (grapefruit, tangerine, blood orange, Meyer lemon, yuzu), 
• white ginger, and 
• exotic (dragon fruit, coconut, prickly pear)

Bright colors & textures

• Boba,
• nitrogen-infusions,
• whipped ingredients, and
• basil seeds

Hard Coffee

In addition, sales for hard coffee increased by more than 11,000% for the 52-week period ending July 18, 2020. With 70% of consumers drinking coffee, which "outpaces" consumption of other non-alcoholic beverages like water, tea, and soda, hard coffee aligns with consumer interest in a "better-for-you" beverage. Consumers are seeking out "familiar and comforting," but "new and different…products that are lower in calories, sugars and carbs."

The wine category

The data below are from two Wine Market Council publications for consumers age 21 and older who drank wine. The first percentage is from a June 2019 survey, and those in parenthesis are from a study conducted in June/July 2017.  For both 2017 and 2019,

35% of wine consumers were "high frequency" drinkers as they consumed wine more than once a week:

• 9.2% consumed wine every day (9% in 2017)
• 25.8% drank wine "more than once a week, but not every day" (26%)

65% were "occasional" drinkers and consumed the beverage less often:

• 17.6% drank wine once a week (19%)
• 25.2% drank wine 2 to 3 times a month (22%)
• 10.9% drank wine once a month (13%)
• 11.3% only drank wine every 2 to 3 months (11%)

As can be seen, only a 0.2% shift occurred between the two "high frequency" categories, whereas changes among the four "occasional" groups were a bit higher.

While the 2017 Nielsen report, discussed above, indicated that wine was not selected "most often" compared to the other beverages for Younger and Older Millennials, the Silicon Valley Bank's State of the US Wine Industry 2021 report shows that:

• Consumption among Millennials has increased since 2017, when 16.6% of these consumers indicated they drank wine, to 20.3% in 2020. 
• Gen Z's wine consumption, which was 0% in 2017 because they were not of legal drinking age, was 2.9% in 2020. 
• Generation X consumption has remained relatively stable with the percent change from 33.5% in 2017 to 34.8% in 2020. 
• As might be expected, consumption for Baby Boomers and older generations decreased during this period.

Wine Intelligence reported that during COVID-19, consumers in all generations indicated that their wine consumption increased. While the increase in consumption for Baby Boomers and older consumers was only 4%, these consumers still account for 37% of regular wine drinkers, who consume wine at least once a month. Data for other generations:

• Gen X accounted for 24% of regular wine consumers, with 29% indicating that their consumption increased 
• Millennials accounted for 31%, with a 28% increase
• Gen Z accounted for 8%, with a 25% increase 

Wine types and styles

Data published by Nielsen for the 52-week period ending November 29, 2020, still support the statement that "red wine is No. 1."  With consumption "around 46.7 percent, [red wine is] slightly eclipsing white wine at 45.5 percent and pink wines at 5 percent."

However, there is always interest in how consumption differs between generations. A report published by Mintel (2019) revealed that of the survey participants, age 22 and older, who drank wine within three months before the study:

• 58% of Millennials reported drinking red wine, and 59% drank white.
• Similar percentages of Gen X participants drank red and white wine, 57% for both types.
• Slightly more Baby Boomers and WWII/Swing/Silent generations, 62 and 63%, respectively, drank red wine. Regarding white wine, 54% of Baby Boomers and 53% of the more mature generations drank white wine during the previous three-month period.

The Silicon Valley Bank's State of the US Wine Industry 2021 report provided market share and grown rates for select wines specific to varietal and type. Among those that experienced a positive rate of growth in 2020 compared to the previous year:

• Specialty wine (e.g., agave-based wine), 11%
• Sauvignon blanc, 9.5%
• Prosecco, 7.3%
• Sangria, 5.6%
• Red blends, 3.9%
• Cabernet sauvignon, 1.6%
• Pinot grigio, 0.6%

Those that experienced a negative growth rate in 2020 compared to the previous year:

• Merlot, -9.7%
• White zinfandel, -7.6%
• White blends, -5.8%
• Chardonnay, -2.7%
• Sparkling – other, -1.4%
• Rosé, -0.3%
• Pinot noir, -0.2%
• White Moscato, -0.2%

Data provided by Mintel (2019) indicate that a higher percentage of Millennials responding that they drank rosé (36%) and champagne/sparkling (37%) than Baby Boomers (28 and 15, respectively). According to the source, 30% of Millennials consumed wine cocktails compared to Baby Boomers, 14%.

While mimosa and sangria may come to mind when thinking about wine cocktails, there are many other cocktails that can be made with wine as a key ingredient. A quick search on the Internet or sites like Pinterest using the term "wine cocktail recipes" yields an immense number of suggestions. For example, long island wine tea, sangria Moscow mule, sparkling apple cider sangria, and many more.

Lolea, a sangria brand that launched in 2014, has experienced tremendous growth in the past few years, offers several recipes using their product as a cocktail base:

• Lolea Julep,
• Lolea Iced tea,
• Loalea passion "a citrus cocktail with the fruitiness of passion fruit and sweet tones of vanilla, Lolea no. 2, passion fruit pulp, vodka and vanilla syrup"

And while much of the past branding efforts for rosé have focused on the female Millennial, in early 2019, UFC champ Conor McGregor launched his own Champ Champ Rosé. Here is an excerpt from the article: "I am very excited and proud to introduce Champ Champ Rosé to the world," said McGregor. "People who know me know I am a proper whiskey man through and through, but they also know I enjoy having a glass of rosé wine on a hot summer's day."

Additional resource

Mintel. 2019. Wine-US-November 2019.