RTDs has remained a marginal product area in Azerbaijan in 2020. These products primarily appeal to young adults of legal drinking age, with older consumers generally favouring stronger and more expensive alcoholic drinks such as spirits and wine.
Sales of RTDs are fairly minimal and the enforced closure of on-trade outlets under the government’s lockdown measures, coupled with the introduction of a curfew, has put a significant dent in what on-trade sales do exist in 2020. RTDs through the on-trade are often enjoyed in nightclubs and bars by younger adults, but with social distancing measures likely to remain in place even once the restrictions are lifted it seems unlikely that RTDs will record anything but minimal sales.
International brands will remain dominant in RTDs in 2020 with the entry of local players being discouraged by the product area’s small size and limited appeal. Among international brands, mid-priced products are the most popular.
After being slightly impacted by the COVID-19 pandemic in 2020, RTDs will perform even worse in 2021, before returning to growth in 2022. However, this will have little to do with the pandemic, and more so the further development of the alcoholic cocktail culture from premium spirits within the on-trade that will act as a limiting factor for RTDs.
RTDs is the smallest product area of alcoholic drinks in Azerbaijan and there were no signs that it was set to see strong development even prior to COVID-19. Furthermore, the decision to introduce excise tax on RTDs as from 2020 will be another barrier to development, with these products already carrying a higher average unit price than beer and cider/perry.
Despite these challenges, if Azerbaijan’s tourism industry rebounds, then this should help on-trade sales to recover, while growing interest among younger adults of legal drinking age also offers some hope for the further development of RTDs. Marketing activities and improvements in distribution via off- and on-trade channels is important to increasing awareness of individual brands, while new launches could strengthen consumer interest in RTDs generally.
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This report originates from Passport, our RTDs research and analysis database.
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