Alcoholic Drinks in Costa Rica

Brand positioning, availability and affordability set the pace in alcoholic drinks

As local consumers are exposed to a global consumption environment, brand awareness and availability influence their purchasing decisions; often recreating positive consumption experiences based on aspirational expectations and budget capabilities. In such a context, pricing and promotional campaigns continued to increase the penetration of recognised and affordable global brands targeted towards middle-income consumers, who opted to upgrade their drinking preferences, whilst adopting more moderate consumption habits that prioritised quality instead of quantity.

Stable growth rates and pricing updates continue to set the pace in alcoholic drinks

As the overall economic performance in 2017 remained framed by an uncertain local (pre-election year) and global context, most alcoholic drinks players continued to adopt aggressive pricing strategies, which leveraged discounts and promotional campaigns to promote point-of-sale awareness whilst helping to maintain stable growth rates amongst local middle-income consumers. In this scenario, mature categories (including most spirits) continued to show a combination of contracting and moderate growth rates, with pricing and brand availability tending to play major roles in the demand for these products.

Major local manufacturers and distributors continue to set the pace in Costa Rica

The competitive environment within all alcoholic drinks categories in Costa Rica continued to be framed by the dominant position of the local company Florida Bebidas, which continued to account for a dominant share of sales in beer and RTDs/high-strength premixes in Costa Rica, whilst also having a leading role in spirits and wine, leveraging consolidated distribution ventures with major global manufacturers, including its distribution alliance with Diageo in spirits and with Concha y Toro in wine. Florida Bebidas remains clearly ahead in terms of volume and value sales in most alcoholic drinks categories, with spirits being the only exception, in which the local government-owned company Fábrica Nacional de Licores (FANAL) maintains the lead in volume terms, due to the wide availability and affordable unit prices of its economy brands.

Modern grocery retailers gain penetration across all categories

As modern grocery retailers continued to engage in aggressive penetration strategies across the country, the sale of alcoholic drinks gained momentum through chained outlets such as supermarkets, convenience stores, and discounters. Location, convenience and these players’ capacity to leverage their scale of operations explain the rising popularity of modern retailers in Costa Rica.

Segmentation and innovation are anticipated to continue driving demand

Given the constant demand for new value proposals amongst the younger local population, it is anticipated that major players will continue to make use of segmentation and innovation strategies to incentivise per capita consumption of alcoholic drinks across the country. In this scenario, millennials will continue to be a key area of focus for most local and international brands, which will address their needs with more precision through the adoption of more specific segmentation efforts based on age, gender, lifestyle and purchasing capacity.

Files are delivered directly into your account within a few minutes of purchase.