Whiskey Market size was valued at $58 billion in 2020, growing at a CAGR of 6.2% during the forecast period 2021-2026. Whiskey is a fermented alcoholic drink manufactured from barley, corn, rye, or wheat; and the process of mixing grains is known as fermented grain mash. Distillers make the product with farm-grown grains and syringaldehyde which is stored in oak wood barrels that gives a blend of whole spices, herbs, and grains to enrich the texture and aroma. As the oak-wood barrels age, it releases a few organic compounds which have a distinct taste and aroma called vanillin. Small amounts of vanillin are released in whiskey which gives a rich smell most commonly observed in bourbon, and this particularly requires whiskey to be stored in oak wood barrels for more than 10 years. The number of nightclubs, pubs, restaurants, and distilleries providing alcoholic beverages has increased rapidly in recent years. The increase in consumer spending, product developments, changing lifestyles, and growing demand from young consumers have all been driving this growth. Whiskey is typically associated with a desire to showcase class and sophistication among colleagues, causing buyers to seek unique and distinctive alcohol experiences. Furthermore, manufacturers' extensive promotional initiatives to strengthen distribution and purchase channels are driving the market forward.
Whiskey Market Segment Analysis - By Product Type
Scotch Whiskey held the largest share in the global Whiskey Market in 2020. It was originally made in Scotland with malted barley distilled for at least three years. Owing to its taste, texture and aroma Scottish whiskey has gained most popularity among whiskey brands across the world. Scotch Whiskey comes in five categories namely blended scotch whiskey, single malt scotch whiskey, blended malt scotch whiskey, single grain scotch whiskey and blended grain scotch whiskey. It is available in premium as well as high-end premium segment and is widely used in restaurants, pubs and nightclubs. It is a very popular whiskey type among millennials and old age population owing to its rich taste and texture which in turn is driving the growth of Whiskey market.
American Whiskey is the next largest segment growing at a CAGR of 7.8% over the forecast period 2021-2026. Owing to increased consumption of alcohol among millennials and old age population in U.S. It comes in all five distinct categories, with a fair price and is produced by large number of companies across U.S. American Whiskey is also exported in Asian and African countries which has led to increase in production and competition among American Whiskey brands. It is the fastest growing segment and is estimated to drive the growth of Whiskey Market.
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Whiskey Market Segment Analysis - By Product Quality
The Premium segment dominated the whiskey market in 2020. Owing to high consumer demand, premium whiskey has the most product offerings among whiskey producers. It has also been the most preferred option of whiskey among other products owing to its precise and regulated production techniques giving a rich and smooth flavor. Premium whiskey has also been employed as a mixer in cocktails, allowing the market to grow even further.
High-End Premium is the next largest segment estimated to grow at a CAGR of 5.1% over the period 2021-2026. The target audience for this segment is particularly adults with a fine taste in whiskey. There are specialized brands producing high-end premium whiskey with specialized distillery techniques which are fermented for more than 10 years. This segment has witnessed tremendous growth in European countries and many well-recognized brands have started to invest in this segment. Whiskey from this segment is only available in 5-star restaurants and high-end nightclubs where adults prefer quality over price. Thus, this segment is gaining popularity among the rich consumer base which is driving the High-End Whiskey Market.
Whiskey Market Segment Analysis - By Geography
Europe dominated the Whiskey Market with the largest market share of 34.2% in 2020. This can be related to the region's increasing popularity and significant alcohol consumption. European market is driven by large number of distilleries, the launch of improved beverage flavours, and the presence of several significant competitors in the market. However, during the forecast period 2021-2026, North America is estimated to increase at the fastest rate owing to large Alcohol consumption populations, rising disposable income of people.
Whiskey Market Drivers
Increasing Adoption of Western Lifestyle.
People in Asia-Pacific region were not exposed to whiskey. They consumed local alcohol like ‘Tadi’ and ‘Saki’. Owing to globalisation and adoption of western lifestyle, people in Asia Pacific region started consumption of whiskey. This not only changed the market dynamics for whiskey industry but also led to change in preferences of consumers in Asia Pacific. This change in preference of taste led to increase in growth of the Whiskey Market.
Increasing consumption of Whiskey among Gen-Z
During the year 2020 Gen-Z were considered as highest consumers of whiskey. This is owing to higher disposable incomes, adoption of western lifestyle and increasing number of pubs and night-clubs in tier-1 cities. This led to increase in growth of Whiskey Market in emerging countries across the world.
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Whiskey Market Challenges
Health concerns related to consumption
Many health professionals across the world believe that consumption of whiskey is injurious to heart and liver. Over consumption of whiskey cause liver failure and stroke. Owing to increase in awareness among people regarding negative health effects caused by whiskey is set to hamper the growth of Whiskey Market.
Lack of traditional distillery expertise in new emerging distilleries
New distilleries lack the expertise of traditional whiskey making process which leads to bad texture and aroma. This creates a negative perception among consumers in consumption of whiskey which in turn hampers the growth of Whiskey Market across the globe.
Whiskey Market Landscape
Product launches, mergers and acquisitions, joint ventures, and R&D activities are key strategies adopted by players in the Whiskey Market. The top 10 whiskey companies are Diageo plc, William Grant & Sons Ltd, Pernod Ricard, Beam Suntory, Inc., The Brown–Forman Corporation, Constellation Brands Inc., Bacardi Limited, Ltd., La Martiniquaise, Asahi Group Holdings, and Loch Lomond Distillers Ltd
Whiskey Market Developments
July 2021, Diageo plc announced that Johnnie Walker whisky would be available in paper bottles. By addressing the environment, the company also opted to sell its product in plastic-free bottles and would henceforth incorporate wood-pulp material.
Key Takeaways
This report provides an analytical depiction of the Global Whiskey Market, as well as current trends and future projections, in order to identify the most potential growth opportunities.
Europe region dominated the Whiskey Market with largest market share of 34.2% in 2020. This can be related to the region's increasing popularity and significant alcohol consumption.
A detailed Value Chain Analysis and Regulatory Analysis based on past data and current market trends included in the research.
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