Rtds in Spain

2020 IMPACT

Popular off-trade category remains resilient to the impact of COVID-19

In 2020, RTDs proved itself to be relatively resilient to the impact of the COVID-19 pandemic. The category recorded a very low level decline of total volume sales in 2020, demonstrating a much stronger performance than other hard hit alcoholic drinks categories such as spirits, beer, wine, and cider/perry.

Spirit-based RTDs suffer from on-trade closures as wine-based RTDs maintain a strong appeal

Although the category as a whole was relatively unaffected by COVID-19 horeca closures in 2020, spirit-based RTDs contributed considerably to the overall slight negative performance of that category. Although spirit-based RTDs accounts for a relatively small proportion of RTDs in Spain - with wine-based RTDs being the most popular and malt-based RTDs yet to register significant volume sales – spirit-based RTDs is generally more reliant on horeca sales.

Players reposition RTDs as aperitifs in response to the growing “tardeo” trend

As in other categories, the “tardeo” (or aperitif) trend continued to gain ground in 2020 despite the disruption of the COVID-19 pandemic. This trend has seen consumers increasingly drinking alcoholic drinks during the day rather than late at night, with many consumers preferring to sleep earlier and opt for a lighter alcoholic drink product in the afternoon, after work, or during lunch.

RECOVERY AND OPPORTUNITIES

Category to remain stable as off-trade sales lose some momentum

Over the forecast period, total volume sales of RTDs are expected to remain relatively stable. Even though on-trade sales are expected to recover with the reopening of horeca outlets, off-trade sales are expected to dip slightly as consumers return to their favourite bars and restaurants and at-home consumption drops.

Premiumisation boosts value growth as companies upgrade their offerings

Despite registering relatively stable total volume sales over the forecast period, RTDs is projected to record much stronger total value growth in the coming years thanks to the premiumisation trend which is becoming increasingly apparent in the category. Over the forecast period, continuing premiumisation will be reflected in both off-trade and on-trade performance.

Category faces pressure from low-alcohol trend

Over the forecast period, RTDs is expected to face growing pressure from the low alcohol trend in Spain. As consumers are beginning to pay more attention to health and wellness trends (particularly in the wake of the COVID-19 health crisis), consumers are expected to limit their alcohol consumption.