Alcoholic Beverages Market Growth Drivers: Factors Influencing Industry Expansion
The global alcoholic beverages market comprises a wide range of alcoholic drinks from beer, wine to spirits and mixed drinks. Beer is the most widely consumed alcoholic drink with lager being the dominant beer type. Wine is produced from fermented grape juice and comes in various varieties based on the region of origin and type of grapes used. Spirits are distilled alcoholic drinks made by distilling fermented grain, fruit or vegetables and include vodka, whisky, brandy and rum.
The Global Alcoholic Beverages Market is estimated to be valued at US$ 1,769.41 Bn in 2024 and is expected to exhibit a CAGR of 2.5% over the forecast period 2023 to 2030.
Key Takeaways
Key players operating in the alcoholic beverages market are Anheuser-Busch Inbev (BUD) (Belgium), Asahi Group (Japan), Bacardi (Bermuda), Brown Forman (U.S.), Carlsberg (Denmark), Constellation Brands (U.S.), Diageo (U.K.), Heineken (Netherlands), Pernod Ricard (France), Suntory (Japan). Key players focus on expanding their production facilities and product lines to meet the growing demand. New product launches specifically targeting female consumers and premiumization has been a key strategy adopted by leading players.
The growing social drinking trend especially among millennials and generation Z has boosted the demand for alcoholic beverages. The rising disposable incomes and socialization in pubs, bars, clubs and restaurants has encouraged alcohol consumption globally. Economic development in emerging Asian and African countries is translating to higher spending power and Westernization driving the market growth.
The global alcoholic beverages market has witnessed steady expansion into new international markets over the past decade. Companies focus on capitalizing growth opportunities in Asia Pacific and Latin America with their large consumer base. Africa is also emerging as an attractive market supported by rapid urbanization. Manufacturers emphasis on market penetration through strategic collaboration with local distributors and contract brewing/packing arrangements to establish global footprint.
Market Key Trends
Rising health consciousness is driving the low and no-alcohol beverages trend in developed markets across North America and Europe. This has prompted leading alcoholic beverages companies to launch new products with low abv and innovative flavors to attract health-focused consumers. Experimentation and premiumization are other major trends with luxury drinks and craft varieties gaining popularity. Sustainable production practices and eco-friendly packaging is an increasingly important issue addressed by industry players to appeal environmentally conscious millennial shoppers. Industry adoption of blockchain, AI and IoT is also opening growth avenues through enhanced supply chain visibility, predictive analytics and personalized digital engagements.
Porter's Analysis
Threat of new entrants: There are significant barriers to entry in the form of high initial investments required and established distribution channels.
Bargaining power of buyers: Buyers have moderate bargaining power due to the availability of substitutes. However, brand loyalty limits switching.
Bargaining power of suppliers: Suppliers face low bargaining power due to the availability of substitute raw materials. However, for certain premium brands, suppliers wield more power.
Threat of new substitutes: New non-alcoholic beverages pose a substitute threat. However, switching costs in terms of taste preferences limit this threat.
Competitive rivalry: Fierce competition exists between established industry players.
Geographical Regions
The geographical region where the alcoholic beverages market is concentrated in terms of value is Europe. Countries like France, Italy, Germany, and the UK account for the lion's share of the global market. Mature markets in North America and Europe lead in per-capita consumption and contribute the most to overall market revenues.
The Asia Pacific region is expected to be the fastest-growing geographical region for the alcoholic beverages market during the forecast period. Rising affluence, changing lifestyles, and growing social acceptance are driving market growth in developing countries like China and India. Rapid urbanization and exposure to Western cultures are fueling alcohol consumption, especially among younger consumers in Asia.
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