Inside the IWSR Global Trends Report: Key Drivers for Beverage Alcohol in 2025

After a difficult year for beverage alcohol in 2024, when total beverage alcohol (TBA) volumes declined by -1% and revenue gains were elusive, with value up by +1%, brand owners are facing up to an ever more complex and changeable marketplace.

Against this increasingly volatile backdrop, six key trends have been identified and examined by IWSR, the global authority on beverage alcohol data and intelligence, spanning everything from premiumisation to the external pressures of geopolitics and tariff tensions.

IWSR’s Global Trends Report 2025 analyses these six global macro trends in great depth, breaking them down further into a number of sub-trends that explore 2025’s key market drivers – equipping companies with information and insights to shape their strategies in the months ahead. Here is the summary of some of the key trends. The full 90-page report with in-depth data, charts and analysis across key markets is available via the IWSR platform.

1: Selective premiumisation

The global premiumisation trend is still evident, but it is now less linear than in the past, fragmenting as a result of economic pressures and shifting consumer values. As the market landscape evolves and becomes more nuanced, growth persists in select regions and on specific occasions.

Premium-and-above volumes (excluding national spirits) grew by +3% in 2024, according to IWSR data, largely driven by beer. Growth was more apparent in South America, Asia and Africa & the Middle East, with North America and Europe more subdued.

Health concerns and economic considerations are leading consumers to drink less, but to choose higher-quality options when they do. Rather than being driven by status, people are increasingly motivated by purchases that reflect personal values, occasion relevance and perceived value.

This ‘selective premiumisation’ is particularly apparent in the perennially vibrant cocktail culture, which is fuelled by a growing desire for unique experiences and innovative offerings. RTD cocktails/long drinks volumes are forecast to double globally between 2019 and 2029, with North America seeing growth of up to +400%.

“As premiumisation becomes increasingly fragmented, brand owners must invest in monitoring consumer sentiment and data to identify emerging growth areas,” says Emily Neill, COO Research. “Gaining a clear understanding of the dynamics between categories and the drivers of premiumisation will be key to unlocking new opportunities.”

2: Evolving lifestyles

Beyond TBA declines in key markets such as the US and China in 2024, reassessed priorities are leading consumers to pursue value for money, personalisation and immersive engagement – amid widespread downtrading and, for some, a reassessment of their relationship with alcohol, moving away from traditional consumption occasions.

Initially, economic pressures prompted people to reduce their alcohol intake, but many are now choosing to sustain this lower-consumption lifestyle. At the same time, at-home and virtual experiences are winning out over traditional socialising and alcohol consumption; increasingly, people are seeking connection and community online.

Meanwhile, tourism is on the rise – travel retail volumes increased by +3% in 2024, although spending remained cautious and value-driven – as consumers continue to prioritise value and unique travel experiences, with brands responding to this change in demand.

“To navigate economic pressures and shifting consumer behaviours, brands should offer value-driven products, craft immersive tourism experiences, and embrace and capitalise digital engagement,” explains Neill. “Recognising the shift away from traditional consumption occasions, and tailoring offers to meet evolving demand for affordability, authenticity and virtual entertainment ensures relevance and resilience in a dynamic market.”

3: Digital and tech

Ecommerce continues to offer growth opportunities, with global sales in value terms rising by +2% in 2024, thanks to strong performances for spirits, beer and RTDs, supported by affordability trends in emerging markets. Asia-Pacific, with a +4% ecommerce value gain last year, stands out as an engine for future channel growth.

Ecommerce enables alcohol brands to bypass distribution barriers, connecting directly with consumers. At the same time, tech-driven convenience remains a key area, shaped by economic pressures and the appetite for accessibility – as brand owners diversify their operating models to service this demand.

In the digital world, celebrities and influencers are increasingly shaping trends among younger LDA consumers, with a strong focus on storytelling and sobriety. Meanwhile, celebrity-backed alcohol brands are experiencing mixed degrees of success, but RTDs are a category to watch as the digital narrative shifts towards moderation.

“Convenience and speed continue to be vital to ecommerce success, with emerging markets offering strong growth potential,” says Neill. “Meanwhile, reassessing the shift in celebrity endorsements towards lifestyle-focused branding could unlock new opportunities.

“Ultimately, convenience will remain a cornerstone of any effective strategy. Brands should focus on authentic, affordable, digitally-driven RTD offerings and personalised ecommerce strategies.”

4: Social drinking

Against a challenging economic backdrop, affordability is becoming key and status is being redefined, leading consumers to adjust their channel preferences, favouring earlier, experience-led occasions including the increasingly pervasive aperitivo moment, where spritzes are proving especially popular.

While downtrading is apparent across retail and hospitality, the on-trade continues to tackle a number of headwinds, including policy-driven and structural costs, compounded by higher taxes and constrained consumer spend. Between 2019 and 2024, on-trade TBA volumes contracted in all regions except for Africa & the Middle East, where they grew by +4%.

The response of retailers and consumers to harsh economic conditions has reinforced the importance of at-home drinking, with consumers adapting traditionally on-trade occasions such as dinners and social drinks to home settings, in an environment where they can control expense and experience. In some parts of the world, DIY ‘third spaces’ such as unlicensed home bars are beginning to proliferate.

“Grasping evolving consumption occasions is essential in today’s marketplace, with shifting channel dynamics continuing to shape differentiation and the rise of third spaces,” explains Neill. “Tapping into lower-tempo, early evening moments presents clear opportunities. A strong cocktail offering is now crucial, and there’s still potential in appealing to consumers who prioritise both value and quality.”

5: Health and ethics

Motivations for moderation are broadening and deepening, influenced by both structural and cyclical factors. As consumers find an increasing number of reasons to cut their alcohol consumption, with more like-minded people around them to make the habit stick, switching between full-strength and zero-ABV drinks – ‘zebra striping’ – is gaining momentum.

Cross-category gains drove a +9% rise in total no-alcohol volumes in 2024, with beer still dominant but other categories gaining. No/low volume growth outstripped that of full-strength products in all regions last year except Asia-Pacific, which was impacted by beer’s decline in China.

Meanwhile, cultural identity and value consciousness are driving preferences for local brands in some markets – especially India, where national pride and favourable quality-price perceptions have led Indian single malts to outsell their Scotch counterparts.

Cost pressures remain a limiting factor for sustainable products, but consumers – especially Gen Z and Millennials – still see sustainability as a cue for quality, and are willing to pay for it.

“As moderation evolves, brand owners must reassess how they compete, including addressing the diverse motivational and demographic changes,” says Neill. “While beer continues to spearhead no-alcohol growth, other categories are gaining momentum.

“Despite economic pressure, credentials like sustainability and local origins still offer tangible opportunities, and should not be underestimated.”

6: External pressures

After a turbulent 2024, marked by ongoing conflicts and new geopolitical tensions, consumer behaviour continues to be shaped by persistent instability, trade disruptions and economic challenges. Even as inflation has eased, people have continued to shift their spend away from alcohol, instead prioritising necessities such as fresh food and personal care.

Against this backdrop of global uncertainty, beverage alcohol is confronting issues including fluctuating supply chains, evolving regulatory frameworks and shifting consumer preferences – requiring more immediate and adaptable responses from businesses.

The impact of tariffs and new trade arrangements varies by market and category: so, while Scotch whisky producers will benefit from the new free trade agreement signed between the UK and India, they face higher trade barriers when exporting to the US.

At the same time, governments are tightening regulations and public health messaging is becoming stronger, impacting consumption as a result – especially in parts of the world where trust in official advice is high, such as China, India, Latin America and South Africa.

“With uncertainty likely to persist, brand owners should adopt contingency strategies, review supply chains and explore emerging markets for growth opportunities,” says Neill. “Monitoring public health messaging and legislative changes will continue to be essential for global operators navigating geopolitical and regulatory challenges.”