As a volatile and changeable market continues to define the 2025 drinks trade, the IWSR has compiled a report on the driving forces of the year so far. Here are the six biggest takeaways for the industry.
Selective premiumisation
Premiumisation remains a key force in the global alcohol market, but the IWSR notes it is now unfolding in a more nuanced, less linear way. Health and economic factors are causing consumers to drink less but of higher quality, with purchases increasingly driven by personal values rather than status.
This shift is especially visible in cocktail culture, where volumes of RTD cocktails and long drinks are forecast to double globally between 2019 and 2029. Drinks Retailing research suggests growth in premium RTDs may come at the expense of spirit sales.
Lifestyle changes
Many consumers are rethinking their relationship with alcohol and moving away from traditional drinking occasions. While economic pressures first drove the shift towards lower consumption, many are now maintaining this lifestyle.
When they do drink, at-home and virtual experiences are winning out over bars and restaurants, though tourism remains a growth area. Emily Neill, COO of research, advises brands to focus on value-driven products and immersive experiences.
The importance of digital
Brick-and-mortar retail struggles but e-commerce continues to grow. The IWSR reports global sales value rose 2% in 2024, with Asia-Pacific e-commerce up 4%. The channel allows brands to bypass distribution barriers and engage directly with consumers.
Influencers still sway younger drinkers online, though celebrity-backed brands are facing mixed results with rising consumer fatigue.
Cost challenges reshaping social behaviour
Cost pressures on consumers are especially affecting the on-trade, according to the IWSR. One upside is the renewed importance of drinking at home, “with consumers adapting traditionally on-trade occasions such as dinners and social drinks to home settings”.
The IWSR said that more consumers are likely to create environments in which they can control expenses. It also noted that some communities are creating DIY third spaces to achieve this.
Health and ethics
Moderation and wellness are deepening as long-term trends. Beer remains the dominant player in the non-alcoholic category, though other sectors are growing fast. Local pride is also shaping choices. in India, for example, homegrown single malts now outsell Scotch.
External pressures
Finally, the market remains vulnerable to external pressures from shifting consumer preferences to supply chain instability and changing regulations. Tariffs and trade agreements – such as the EU-US or the UK-India – can be either beneficial or restrictive, depending on the market.
At the same time, governments tightening regulations and introducing stronger public health messaging creates new challenges. The IWSR said that consumption is especially affected in countries where trust in official advice is high, such as China, India, Latin America and South Africa.
