Various lockdowns caused by the pandemic created a new demand for cocktail deliveries and canned RTDs for consumption in public parks and at outdoor garden parties, which has led to a surge in both volume and innovation.
According to a report by IWSR Drinks Market Analysis last year, RTDs are predicted to account for 8% of total beverage alcohol by 2025. Since 2018, RTD volumes have been growing faster than any other major drinks category and a study of 10 focus markets which represent more than 85% of all RTD volumes worldwide (Australia, Brazil, Canada, China, Germany, Japan, Mexico, South Africa, UK, and US) forecast an approximate 15% compound annual growth rate from 2020 to 2025.
“RTDs are still growing at higher rates than spirits, wine and beer, signalling a major shift in consumer interest in this category across all demographics,” says Brandy Rand, chief operating officer for the Americas at IWSR.
“But it’s important to note that RTDs aren’t only stealing share from beer, they’re also attracting spirits consumers in markets such as Australia and the UK, and cider drinkers in South Africa. We’re also seeing a significant premiumisation trend in RTDs as more and more new brands enter the space.”
The same research suggests that Japan has a 22% share of the global RTD market, while Australia, Canada, the UK and China are also key markets. Yet the US will continue to dominate – IWSR says it is “looking strong for the years to come”.
Rand adds: “Today’s consumer not only seeks out convenience but also quality, resulting in opportunities for trade-up alternatives for RTDs – something which is yet to be fully realised.”
QUALITY GAP
Whitebox is a UK-based canned cocktail company at the forefront of the RTD movement. With nine cans currently in the portfolio, its Pocket Negroni remains the company’s flagship, while the Freezer Martini and Chipper’s Old Fashioned are fast gaining momentum.
“We’re tasting a lot of different cans at the moment and I’m genuinely not sure if people are trying them before putting them on the market,” says Alex Lawrence, co-founder of Whitebox. “It’s like they come up with an idea and a brand, play around with a flavour house and then just make it.
“It’s similar in a lot of ways to the gin category because there are brands trading for millions which are purely based on a good marketing strategy, and I think RTDs could su¤ er similarly.
“The seltzer category is a prime example. A er White Claw hit Europe there was a surge of new brands hitting the market and it’s still absurdly big in the States. But I doubt people care about the quality of their seltzers as long as they’re seen on Instagram drinking them.”
