Global vodka market is projected to witness a CAGR of 5.5% during the forecast period 2024-2031, growing from USD 30.82 billion in 2023 to USD 47.3 billion in 2031. The factors that are driving the growth of the vodka market are the versatility of vodka due to its neutral flavor profile, which makes it a preferred option as a cocktail base, consumers’ increasing consumption of alcoholic beverages, and the rising popularity of ready-to-drink beverages. Moreover, increasing consumer awareness of high-quality and ultra-premium vodka, which is superior in taste, ingredients, and craftsmanship, along with the rise in cocktail culture and innovations in the flavors of vodka offerings, is expected to drive the growth of the global vodka market.
As the players in the global vodka market introduce unconventional combinations of flavored vodka, it appeals to consumers who seek unique tastes and flavors in their beverage. Thus, innovation in vodka offerings is aa significant driver fueling the growth of the market. For instance, in January 2024, Berczy made its place in the Hard Teas by launching Juicy Vodka Tea Cocktails containing vodka combined with 25% real fruit juices and organic tea.
Additionally, the rising popularity of craft cocktails has encouraged both home enthusiasts and professional bartenders to experiment with different infusions and combinations, further augmenting the growth of the vodka market as it is a key ingredient in various cocktails such as the Cosmopolitan, Moscow Mule, Bloody Mary, and others.
Urban consumers prefer premium and high-quality crafted vodka to enjoy a luxurious drinking experience to prioritize quality, authenticity, uniqueness, and crafted and artisanal offerings. According to the survey conducted by the Distilled Spirits Council of the United States (DISCUS), in 2022, premium spirits accounted for 33 percent of all spirits sales volume in the United States. In February 2024, CÎROC introduced CÎROC Limonata, its latest luxury and premium flavored vodka. It is a crafted vodka infused with tangy citrus and Italian flavors, which feature a strong lemon taste which balances the sweetness of the beverage.
Liquor stores and other contemporary retail establishments are becoming more popular, giving customers convenience while making purchases. Additionally, pubs, bars, and hotels are facilitating the growth enabling the consumers to try different offerings by the key players.
Flavored Vodka to Gain a High Pace Demand
Demand for flavored vodka is expected to gain a higher growth rate over the forecast period. It offers consumers a diverse and exciting range of options which appeal to a broader audience, having diverse taste preferences. From classic combination of fruits such as raspberries and citrus to unconventional options, such as chocolate or bubblegum, flavored vodka offers consumers a variety of choices and options to explore, elevating their drinking experience.
In March 2024, Pernod Ricard Group’s Absolut Vodka launched Absolut Nights Orange Peel, a new orange peel flavor in China as a part of a business strategy to align local culture with the global trends. The latest addition to Absolut’s Night shots product line is designed to be consumed as a shot and is inspired by Chenpi, a Chinese dried orange rind which is blended with coffee.
Moreover, younger audiences are attracted towards flavored vodka since they are inclined more towards trying out unique combinations every time they indulge in drinking. Thus, the infusions of vibrant flavors into vodka makes it more preferrable among the audience, driving the global vodka market growth.
Canned Packaging to Dominate the Market
The share of canned packaging is dominating the market amongst all packaging formats due to factors such as ease in portability, durability of vodka, and longer shelf-life. Cans offer portability and convenience, making it an ideal option for on-the-go-consumption and social gathering outdoors. Unlike traditional vodka glass bottles, cans are lighter in weight, easily transportable, and shatterproof, enabling the consumers to enjoy their vodka-based beverages in various settings whether indoors or outdoors.
Moreover, this format of packaging protects the beverage from exposure of light and oxygen which helps in maintaining the taste and quality of vodka over time, extending the shelf-life of the product without any compromise on its flavor. For instance, in March 2024, Kylie Jenner, introduced Sprinter, a range of 100-calorie, quality canned vodka sodas.
Additionally, cans are sustainable over traditional glass bottles as they are made from recyclable materials and have a lower level of carbon footprint in terms of production and transportation, thus making it a perfect choice for packaging aligned with the current market trends.
Ready-to-Drink Vodka Beverages to Drive Market Growth
Ready-to-drink vodka beverages are gaining popularity among the consumers due to factors such as convenience and affordability as consuming vodka beverages every time in a bar, or a restaurant can be expensive. Also, with the availability of ready-to-drink offerings, the consumers can enjoy drinking at the convenience of home.
Witnessing the current market trend of vodka as a cocktail drink, distilleries, and alcoholic beverage companies are investing extensively in the procurement of premium ingredients to create a variety of elegant and subtly sparkling drinks, thereby increasing the market growth. The expansion of the vodka market is significantly influenced by the demand for these flavored cocktails globally. The technique of infusion, which involves steeping different components, such as fruits, herbs, spices, or even candies in vodka, gives alcohol distinct flavors and fragrances.
For instance, in March 2024, Skyy, a brand of Davide Campari-Milano N.V. introduced Skyy Vodka and Soda Canned Cocktails in the United States. The premium canned cocktail is available in two citrus-led flavors, namely, lemon and Elderflower, and Lime and Mint. The ready-to-drink vodka cocktail contains key ingredients, namely, Vodka, Soda, and natural citrus and botanical flavors.
In February 2024, Diageo PLC’s Smirnoff, introduced the latest RTD vodka soda range, with the launch of Smirnoff Smash Vodka Soda. It is available in four flavors pineapple orange, watermelon lime, strawberry dragon fruit, and raspberry peach.
Sustainable Packaging to Foster the Market Growth
Vodka manufacturers are prioritizing sustainable packaging to appeal to eco-conscious consumers with the aim to expand the market growth. The players are increasingly shifting towards environmentally friendly packaging material which helps them gain a competitive edge in global vodka market.
Sustainable packaging such as reduction of plastic waste and carbon emissions, usage of recycled materials, and incorporation of recyclable bottles has become a recent market trend in global vodka market.
In June 2023, Absolut, a brand of Pernod Ricard Group launched its first ever commercially available paper packaged bottles of vodka. It is a 100 percent bio-based bottle that reduced CO2 emissions. These single-mold bottles are made from 57% paper with an integrated barrier of recyclable plastic. While the standard glass bottles of Absolut vodka are recyclable, paper bottles are eight times easier to carry since they are lightweight.
Sustainable packaging leads to cost savings as it facilitates reduced material usage and offers potential tax incentives, contributing to the overall cost saving on the product and increasing profitability.
Future Market Scenario (2024 – 2031F)
The global vodka market is expected to rise in the forecast period due to continuous product innovations by key players, expanding its appeal by increasing consumer satisfaction. Moreover, the key players are combining physical and digital experiences in their products to improve their offerings and introduce something innovative and unique for the consumers to keep them hooked with the latest vodka launches.
For instance, in March 2024, Pernod Ricard Group’s Absolut Vodka launched a phygital gifting bottle. The latest offering allows the consumers to send personalized and interactive gifts with each Absolut Vodka bottle, featuring a unique QR code which leads to a personalized gifting experience. The gift-givers can combine voice notes, text messages, photos, emojis, and other content to create a shared celebratory message for the receiver. The recipient can then scan the QR code and use their device to reveal the message in the augmented reality.
Report Scope
“Vodka Market Assessment, Opportunities and Forecast, 2017-2031F”, is a comprehensive report by Markets and Data, providing in-depth analysis and qualitative and quantitative assessment of the current state of global vodka market, industry dynamics, and challenges. The report includes market size, segmental shares, growth trends, opportunities, and forecast between 2024 and 2031. Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.
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