For ages, the industry has been talking about young people not drinking as much wine. The giant trade shows have upped their spirits games accordingly, with new halls dedicated the likes of vodka, gin, rum, whisky, Tequila and brandy.  

But there’s a new spanner in the works: people don’t seem to be drinking spirits as much either. In recent results, Diageo’s GB reporting region saw a 6% decline in spirits net sales “due to overall category weakness”.

Shortly after Diageo, Pernod Ricard, which owns brands including Absolut, Jameson and Beefeater, released its own H1 figures, reporting a 4% organic sales decline globally. Total sales for the period reached €6.176 billion, with the Americas seeing declines of 4%, led by a 7% drop in the US. Asia and Rest of World saw a similar 5% decrease, with a sharp 25% decline in China attributed to ongoing economic pressures and “weak consumer demand”.

Sales in Europe were down 2% and as part of its results presentation, Pernod Ricard said it is gaining share in the UK on-trade but losing it in the off-trade.

Both companies also mentioned the threat of tariffs from the Trump presidency, which last time around were bad news for whisk(e)y in particular.

 Before you jack it all in for a job as a postal worker (just me?), it’s worth noting that there’s still plenty of money sloshing around in spirits.

Diageo’s H1 net sales were $10.9 billion (£8.75 billion) for the six months to December 31 – and in GBP Pernod’s were around £5.15 billion.

So, which spirits are people drinking?

A look at Pernod’s slide deck for strategic international brands’ overall organic net sales growth suggests blended whisky is the big winner for the company with Ballantine’s up 8% and Chivas Regal up 3%. The pair offer some bright spots among declines for the likes of Absolut (-2%), Malibu (-4%) and The Glenlivet single malt Scotch (-9%). Jameson Irish whiskey came in flat, while Martell Cognac suffered the biggest losses (down 25%) due to performance in China and global travel retail.

While blended Scotch whisky was a winner for Pernod, at Diageo, Johnnie Walker was down 6% in organic net sales terms, so perhaps consumers are more interested in brands than categories. This is possibly evidenced again with Diageo’s Tequila stable – Don Julio is up 50% in organic net sales terms, while Casamigos (which includes Tequila and Mezcal) is down 21%.

Of course, it’s hard to make sweeping trends statements when some of these brands performed well in certain markets, and there are always other factors in play – such as distribution changes or marketing spend. But there does seem to be an overarching sense of what Diageo calls a “cautious consumer environment”.

In the UK, the latest Budget certainly hasn’t inspired much confidence in drinks businesses, with the likes of Berry Bros considering redundancies while other retailers brace for price increases and hiring freezes.

In this time of mass malaise and geopolitical uncertainty, could it be that what spirits drinkers are looking for is a bit more excitement? Strong and stable branding saw us through Covid but perhaps it’s time for the wow factor.