Spirits in Ireland

2020 IMPACT

Total volume sales decline, as on-trade closures negatively impacts spirits

Total volume sales of spirits declined significantly in 2020 due to the outbreak of COVID-19, with a double-digit decline driven by the closure of on-trade establishments. Even during periods when on-trade venues were open, consumers cautious behaviour in public meant that many were nervous about returning to public settings, and this continued to stifle growth for spirits throughout 2020.

Lockdown periods boost off-trade sales, with consumers migrating to e-commerce

As a result of ongoing lockdowns and home seclusion, home consumption continued to be positive in 2020.

Vodka drives sales, however, growth for the product is challenged by gin

The off-trade volume growth of spirits was mainly driven by gin in 2020, due to the rising popularity of the drink, with English gin selected by many as a fashionable item for drinking neatness of mixing with tonic and other ingredients. English gin has also benefited from the growing craft trend and the popularity of mixes such as gin and tonic, as well as the emergence of flavoured gin products.

RECOVERY AND OPPORTUNITIES

The return of domestic and international tourism boosts on-trade growth for spirits

Overall volume sales of spirits will recover from 2021 due to the opening of on-trade businesses, with volume growth continuing to remain steady across the full forecast period. Although on-trade will remain challenged in 2021, due to ongoing COVID-19 restrictions, on-trade is set to record heightened growth compared to off-trade across the coming years, supported by the return of domestic and international tourism.

Off-trade growth is driven by non alcoholic spirits and gin, while white rum and tequila decline

While the on-trade is set to recover in 2021, off-trade volume growth is expected to decline during the year, as price sensitivity impacts buying habits. In addition, the competition from on-trade establishments will also dampen retail sales, especially from consumers keen to socialise in bars and pubs once more.

Opportunity for e-commerce and home delivery services to grow

There is an opportunity for e-commerce retailers across the forecast period, especially in the early part of the forecast period when some consumers may still be nervous about socialising in public. As COVID-19 led to an increase in e-commerce sales for spirits, e-commerce channels may see a continued rise across the forecast period, especially if they focus on their ease, convenience and home delivery services.