Close Menu
News

Consumers become more polarised on alcohol spending amid cost pressures

Premiumisation holds strong despite the majority of global consumers cutting back on alcohol spending in favour of essentials, IWSR Drinks Market Analysis has found.

Consumers opt to cut back on alcohol spending amid cost pressures

Findings from IWSR Drinks Market Analysis, a specialist in global beverage alcohol data and insights, have revealed that alcohol spend is falling in a number of key markets around the world.

Data was sourced from wave two of IWSR’s consumer barometer price sensitivity tracking, based on consumer surveys conducted in February 2023 across the 17 key markets of Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Netherlands, Poland, South Africa, Spain, Taiwan, the UK, and the US.

Consumers are choosing to cut back on alcohol expenditure, prioritising necessities including meat, fish, poultry, and cleaning products.

The UK, which has experienced double-digit inflation, has felt this trend most severely. The reduction in alcohol spending is also notable in Germany and Australia. Choosing not to buy alcohol was the second most popular strategy for saving money in these countries, as well as in France and Canada, which are also experiencing financial pressures.

“To allay the impact of the cost-of-living crisis, beverage alcohol consumers are becoming more selective in how and when they spend on alcohol,” said Richard Halstead, COO consumer insights, IWSR Drinks Market Analysis.

However, markets are becoming more polarised in terms of price expectations, with a trend in premiumisation continuing for some consumers as others tighten their purse strings. Premium consumption behaviour continues in many markets, but is growing at a more moderate rate than previously. Many consumers are now choosing to drink better quality alcohol less often instead of having to down-trade, using moderation as a money-saving strategy.

The on-trade is resisting economic pressures in many markets, and is largely holding up in Europe and the Americas. Relaxation of Covid-19 restrictions in China, Japan, and Taiwan have been a boost for the on-premise.

“After the pandemic, at-home drinking is still preferred, but there is a strong motivation to go out, just with less frequency and more mindfulness in alcohol consumption and spending,” Halstead added.

Related news

On the first day of Christmas...

Scala Dei celebrates 50 years of Priorat winemaking

Tom Parker Bowles and Henry Jeffreys launch podcast

Leave a Reply

Your email address will not be published. Required fields are marked *

It looks like you're in Asia, would you like to be redirected to the Drinks Business Asia edition?

Yes, take me to the Asia edition No