During 2021, off-trade trade volume sales of spirits declined as demand for spirits shifted back to the on-trade. Indeed, positive on-trade volume growth was recorded in the category during 2021 after on-trade demand plummeted during 2020, the direct result of the COVID-19 pandemic.
German discount grocery retailer Lidl & Schwartz GmbH expanded into Latvia during 2021, opening its first stores in the country and introducing local consumers to its broad range of high-quality private label alcoholic drinks, including a diverse portfolio of spirits. The retailer is betting heavily on its vodka brands Rachmaninoff and Gieroy, which represent excellent value for money and have a strong chance of becoming popular in a country with high per capita vodka consumption.
2020 saw off-trade sales of vodka increase despite the category registering strong on-trade sales declines over the course of the year as access to hospitality venues narrowed due to social distancing restrictions, while many consumers were reluctant to socialise outside of the home due to fears of contagion. One particular reason for the strong off-trade growth recorded in the category during 2020 was that many consumers were using low-cost vodka as a household disinfectant, in lieu of ethyl alcohol.
The forecast period is expected to see spirits return to pre-COVID-19 levels of on-trade sales as the receding impact of the pandemic will mean that consumers return to bars, restaurants, cafés and nightclubs to enjoy spirits whilst socialising. However, off-trade sales are expected to continue declining due to negative population growth, which is in turn the result of high levels of emigration among young working age men and women, many of whom are leaving the country in search of better work opportunities abroad.
During the forecast period, the traditional preference for vodka and the traditional local spirit black balsam (categorised under other spirits) is expected to be eroded to some extent as the prevailing trends in spirits at global level become increasingly influential in Latvia. While the very high consumption of black balsam is set to ensure that other spirits remains by far the largest category of spirits in the country throughout the forecast period, younger consumers, especially those living in Riga and other large cities, are increasingly eschewing vodka and black balsam in favour of spirits with a fashionable profile.
2020 was the breakthrough year for e-commerce in Latvia as many consumers turned to the channel as a way of avoiding shopping in crowded stores and minimising the risk that they would come into contact with the COVID-19 virus. 2021 saw further growth in sales of alcoholic drinks via e-commerce as significant numbers of consumers can view realise the convenience that e-commerce represent generally, especially when purchasing spirits, a category of products that are generally considered to be heavy and bulky and thus ideal to be ordered online for home delivery.
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Understand the latest market trends and future growth opportunities for the Spirits industry in Latvia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Spirits
This is the aggregation of whisk(e)y, brandy and Cognac, white spirits, rum, tequila, liqueurs and other spirits.
See All of Our DefinitionsThis report originates from Passport, our Spirits research and analysis database.
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