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Premium beer gaining ground in developed markets
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Friday, 13 November, 2026, 11 : 00 AM [IST]
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Our Bureau, Mumbai
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The global alcoholic beverages market which was valued at $2,488.19 billion in 2025,will reach $4,109.27 billion by 2034 at 5.7 per cent CAGR, according to Polaris Market Research. The headline number hides the real story. Growth is no longer a volume game. Consumers are trading up to premium products, reaching for convenient formats and, increasingly, moderating how much they drink. For brand owners, the strategic question is no longer how to sell more, but how to sell something more valuable.
Premiumisation is the clearest expression of “better, not more.” Consumers are choosing higher-quality drinks with better ingredients, distinctive flavours and stronger packaging, and the shift is visible even in mass categories. Premium beer is gaining ground in developed markets such as US and UK, and craft brewers are winning younger drinkers with small-batch, locally rooted products.
The business implication is that price-per-serve is becoming a more reliable growth lever than volume. Beer still holds the largest share of the market at 42.3 per cent, but spirits (5.9 per cent CAGR) and cider, perry and rice wine (6.1 per cent) are growing faster. Rising incomes reinforce the trend. China’s per capita income rose 5.0 per cent in 2025, and similar gains in India, Brazil and Southeast Asia are expanding the pool of consumers willing to pay more.
If premiumisation raises the value of each drink, ready-to-drink formats widen who is drinking. Hard seltzer is forecast to be the fastest-growing type at 7.2 per cent CAGR, helped by easy packaging, flavour variety and broader distribution. Hybrid drinks and RTD cocktails extend the same logic.
Corporate deal-making shows how seriously incumbents take this shift. In October 2026, Constellation Brands acquired the vodka-based RTD brand SpikedAde for $75 million plus up to $278 million in performance-based payments. Molson Coors completed its acquisition of Atomic Brands, maker of Monaco Cocktails, in April 2026, positioning itself as a leading RTD cocktail supplier. United Spirits entered India’s RTD market with Smirnoff Ice in October 2026. The pattern is consistent: large players are buying growth in formats rather than waiting to build it.
The same consumer attitudes that fuel premiumisation also create headwinds. Health-conscious drinkers are cutting back, and non-alcoholic beer, wine and spirits are increasingly used as substitutes in social settings. Excise taxes compound the pressure by raising shelf prices and squeezing margins, and licensing complexity and input-cost volatility keep barriers to entry high.
Trade policy adds another layer of uncertainty. A 2025 academic analysis cited by Polaris suggests a universal US tariff increase could cut global exports of wine by 13 per cent, spirits by 22 per cent and beer by 33 per cent. The sensible response is portfolio breadth. Companies are launching lower-alcohol cordials and liquors and lower-calorie beers, turning moderation from a threat into a product category.
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