Tequila is one of the fastest growing spirits, its popularity rising with changing consumer behaviour and interest in celebrity culture. Its dynamic performance presents an opportunity to reassess our understanding of this unique product – from basics such as how it’s produced to the essential strategies that are driving its success. Looking at new product developments, and seeing what’s new in the distilled agave market, we can also start to answer the question: What is the future of tequila?
This report comes in PPT.
Premium and super-premium tequilas have been significant drivers of both sales volumes and investment among alcoholic drinks companies, but as the world potentially moves towards recession and the cost-of-living crisis becomes widespread, the category will have to prove its adaptability in order to stay relevant and appeal to consumers with less purchasing power.
As an international recession becomes more and more a reality, while tequila prices continue rising, with high demand, companies need to rethink and search for alternatives for their portfolios, be it going towards lower price points or maintaining the category’s relevance with new product developments, such as Mezcal, raicilla, sotol and destillados de agave.
Although tequila is one of the fastest growing spirits worldwide, consumption is concentrated in the US, Mexico and Canada. English speaking countries influenced and inspired by the US are also strong potential markets with high growth rates. Key metropolitan centres around the globe leading the mixology race offer opportunities to explore tequila consumption in a variety of ways.
Agave products have a complex and long supply chain, taking years for the plant to mature, while also having geographic restrictions. If companies want to explore the tequila and mezcal category, rethinking what products can surf the tequila wave and possibly investing in them could give companies the flexibility to not only face economic downturns but also increase penetration and appeal to younger demographics keen to explore new offerings and esoteric categories.
Celebrity association with tequila is currently a hot trend, explored by many brands and companies, but it does not come without risks. Too strong an association with a particular celebrity exposes the brand to the ups and downs of the person themselves, potentially becoming irrelevant as time passes or being associated with scandals, especially as “cancel culture” becomes more prevalent.
Alcoholic drinks is the aggregation of beer, wine, spirits, cider/perry and RTDs.See All of Our Definitions
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