A Lift in Craft Spirits
Craft spirits account for one in seven global spirit launches, according to Mintel research
Overall, research from Mintel GNPD (Global New Products Database) reveals craft spirit launches increased by 265% globally between 2011 and 2015, and it seems that it is the US that has been driving the craze. Of all craft spirits launched in this time, half (49%) have been in the US and 42% in Europe, compared to just 4% in Latin America and 3% in Asia Pacific.
And it seems the surge in launches of craft spirits is backed globally by strong consumer demand for artisanal alcoholic beverages. Over half (55%) of US alcohol drinkers agree that craft alcohol brands are of higher quality than big brands and demand is mirrored across Europe too. Around half of consumers in France (55%), Italy (53%), Germany (50%) and Poland (46%) agree that spirits from small/craft distillers are more appealing than large, mass-produced brands. While in the UK, 37% of dark spirits/liqueur drinkers are prepared to pay more for craft variants.
Jonny Forsyth, Global Drinks Analyst at Mintel, said:
“Craft spirit launches are growing at a rapid pace and will continue to rise in more mature markets - particularly the US - as consumers continually seek out ‘special’ offerings. Despite being a relatively small sector of the market, craft spirits are growing in response to the huge consumer-led demand for more authentic, more distinctive, more local, less processed and more interesting spirit brands.”
When it comes to the "craftiest" spirit, currently whisky reigns supreme, accounting for 43% of global craft spirit launches in 2015, up from 37% in 2011. However, gin is hot on its heels, accounting for 23% of global craft spirit launches in 2015, up from 9% in 2011.
“For craft producers, gin has the advantage of taking days rather than years to produce, unlike whisky. Therefore as startups seek to balance production of more nuanced spirits with the commercial realities, gin is an appealing choice,” added Forsyth.
Mintel research reveals that it is Millennials who are driving demand for craft spirits around the globe. Three quarters (75%) of US Millennials agree craft alcohol brands are higher quality than big brands and 34% of UK Millennials agree craft drinks are worth paying more for.
Furthermore, Mintel research indicates that almost half (46%) of German Millennial spirits buyers say “high quality” is an important factor influencing their purchase intention, up from 35% in 2013.
“Millennials are a driving force behind the growth of craft spirits, having taken their ‘creative’ and ‘unique’ ethos into their spirits-buying habits. Rather than wanting to affiliate themselves with bigger brands, Millennials often seek to define themselves by more niche, higher quality brands with a quirky backstory; and ideally, they are brands their peers have not even heard of,” continued Forsyth.
As craft spirits gain traction, they are increasingly venturing into flavored territory, particularly in the US market. Almost half (47%) of the craft spirits launched in the US in 2016 are flavored, up from one fifth (21%) in 2015. Indeed flavor remains a key driver in spirit choice in the US, with 41% of US white spirit drinkers looking for a flavor that they like when choosing white spirits, while fruit (36%) and sweetened (34%) top the list of flavors US dark spirit drinkers are currently consuming.
Although flavored spirits aren’t as established in Europe, consumers still show an interest in these drinks. Around one fifth (23%) of consumers in Poland agree that spirits with added flavor are worth paying more for, followed by 19% in Spain, 18% in Germany and 18% in Italy.
“Traditionally, many craft distillers have stayed away from flavoring spirits as this is seen as less premium. However, with flavor a key driver for spirits drinkers in many countries, craft innovators are now seeking to use more premium, nuanced and naturally flavored innovation. This is a route that craft brewers have previously followed,” concluded Forsyth.