Summary
The global whiskey market, valued at $68 billion in 2022, has been growing steadily with a projected CAGR of 4.9% through 2027. Key trends driving this expansion include a strong cocktail trend, premiumization of whiskey, innovative brand launches with an emphasis on ingredient origin and quality, as well as tourism related to spirits, particularly in Western Europe. The market remains dominated by large entities like Pernod-Ricard, Diageo, and William Grant, with major producing countries being Scotland, the United States, Canada, Ireland, and Japan. Despite challenges such as shipping costs and energy price rises, the sector demonstrates resilience, bouncing back from lockdown-induced sales slumps. In Italy, the whiskey market has seen a slight decrease to €58.9 million in 2021 but is recovering post-pandemic.
The Italian market is characterized by strong imports, particularly from the UK, and a relatively low per capita consumption which remains a niche but an increasingly popular beverage choice, especially during holidays and among women. The global and Italian whiskey markets are adapting to new consumption patterns, including a shift towards online purchases, which surged during the pandemic, especially among younger demographics and men. The industry faces strict regulations, especially in Italy, where excise duty and VAT account for approximately 31% of the retail price of whiskey
Italian Spirits Market: A Toast to Tradition and Innovation
In Italy, the whiskey market, though niche, is experiencing a steady rise in enthusiasm and growth. Positioned prominently within the larger spirits sector, whiskey stands out with its distinct production involving malting, fermentation, distillation, and aging. The Italian market has shown an appreciation for both classic and innovative whiskey brands, with an increasing number of young Italian enthusiasts indulging in the beverage, albeit the per capita consumption remains relatively low at about 0.2 liters, compared to between 1 and 3 liters in France. The growth of the whiskey market in Italy is being driven by a combination of factors, including the emerging popularity of cocktail trends, a growing preference for premium varieties of the spirit, and a burgeoning interest in spirit-related tourism.
Notably, the Italian market is embracing specialty events such as whiskey festivals in cities like Rome, Milan, and Florence, further propelling the drink's popularity. Among the whiskey brands that have found favor with Italian consumers are Lagavulin, Ardbeg, Talisker, Caol Ila, and Glenfiddich. The Italian spirits market is a bastion of quality and tradition, recognized globally for its excellence. Despite its fragmentation and regional specificity, the market has a handful of large players like Campari, Diageo, and Pernod Ricard, commanding close to 40 percent of the market share.
These companies, along with numerous smaller and artisanal producers, shape a highly concentrated landscape. The presence of internet sales of spirits has also seen a dramatic rise amongst the Italian consumers, with a staggering increase of over 165 percent among the 18-34 age group. This trend of online purchases highlights the technological evolution of the traditional market, as well as a shift in consumer behaviors. Continuing the tradition while embracing innovation, the Italian whiskey market has shown resilience and adaptability, whether through enduring the effects of the Covid-19 pandemic or responding to evolving consumer preferences. It stands poised between maintaining the heritage of its celebrated spirits and welcoming the new tastes and experiences coveted by a younger and more diverse consumer base. As this market continues to mature, the coupling of historical significance with contemporary desires promises a dynamic future for whiskey in Italy.
Key Market Players Shaping the Whiskey Industry Landscape
The global whiskey market is a dynamic and evolving industry, teeming with notable players who have established themselves through tradition, quality, and innovation. Among the key market players in the whiskey industry, there are a few that stand out due to their brand recognition, extensive product lines, and historical significance.
- As one of the world's leading beverage companies, Diageo boasts an impressive portfolio of renowned whiskey brands. Known for its strategic acquisitions and marketing prowess, Diageo owns several prominent names in the whiskey world, such as Johnnie Walker, one of the best-selling Scotch whiskies globally, and the iconic American bourbon brand, Bulleit.
- Pernod Ricard : This Paris-based alcoholic beverage company is recognized for its diverse range of spirits, including a selection of premium whiskey brands. Pernod Ricard is responsible for the esteemed Jameson Irish Whiskey, which has become a global favorite, as well as a collection of fine Scotch whiskies that include Glenlivet and Chivas Regal.
- William Grant & Sons : An independent, family-owned Scottish company, William Grant & Sons has cemented its legacy with the creation of the well-regarded single malt Scotch whiskey, Glenfiddich. The company's commitment to craftsmanship and innovation continues to captivate whiskey enthusiasts around the world.
- Campari Group : Although traditionally known for their aperitifs and liqueurs, Campari Group has expanded its foray into the whiskey market with the acquisition of brands such as Wild Turkey, a classic bourbon with a devoted following, and the Glen Grant Scotch whiskey. With a presence across various spirit categories, Campari Group adds a touch of Italian flair to the global whiskey scene.
- Beam Suntory : Born from the merger of an American powerhouse and a Japanese whiskey trailblazer, Beam Suntory offers some of the most sought-after whiskies. From the robust and celebrated Jim Beam bourbon to the exquisite artistry of Japanese single malts like Yamazaki and Hakushu, Beam Suntory's diverse range appeals to a broad spectrum of whiskey lovers.
- Brown-Forman : As the name behind one of the world's most recognizable bourbon brands, Jack Daniel's, Brown-Forman commands significant influence in the whiskey market. Their brand portfolio includes other well-known labels like Woodford Reserve and Old Forester, both highly respected in the whiskey connoisseur community.
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- Last update : 01/12/2022
Summary and extracts
1 Market Overview
1.1 Definition and presentation
The whiskey market is a sub-segment of the spirits (beverages produced from distilled alcohol) market. Spirits are separated into two categories:
-"Simple" spirits, which include whiskey, but also vodka, gin and rum, whose taste is related to the distillation of the raw material.
-"Compound" spirits, such as aniseed aperitifs, or liqueurs whose taste is linked to the addition of aromatic substances to a neutral alcohol or brandy.
Whiskey is obtained by a manufacturing process that requires several skills: malting of grains, fermentation, distillation, and aging.
Globally, the whiskey market is considered to be growing. It was valued at $59 billion in 2019 and is projected to grow at a CAGR of 4.9 percent annually through 2027.
The trends driving this growth are the increase in people's purchasing power and the increasing number of young people who can drink legally.
Europe is the leading whiskey exporter in the world, but the United States is also increasing its exports.
Even in Italy this market is estimated to be growing, the turnover has greatly increased in recent years and with it also the number of enthusiasts to this sector even if the amount of whiskey consumed by Italians still remains rather low standing at 0.2 liters compared to 2 liters consumed by the French.
In any case, we can speak of a real whisky revolution that began in 2010 and has not yet stopped. The growing popularity of whisky also stems from the numerous festivals centered on this drink that are organized every year in different Italian cities such as Rome, Milan and Florence.
The best-selling whiskey brands in Italy are:Lagavulin,Ardbeg,Talisker,CAol Ila,Glenfiddich.
From the above information it can be seen that the whiskey market is growing steadily over the past few years but is still considered a niche market that can be difficult to penetrate and full of challenges.
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