Alcohol Beverages: Generations Fueling the Libations

Millennials and Gen X helping to reshape alcohol market

Convenience-store retailers thirsting to assemble more elaborate adult-beverage departments in 2015 might find promise in this trend: Off-premise wine and spirits consumption is growing mightily, with buying motivators predicated on generational desires.

Alcohol sales have increased in volume and value over the past 12 months, according to a recent report by Nielsen, but share of this growing pie is shifting among beer, wine and spirits drinkers. The growth of off-premise spirits and wine is occurring at the expense of beer, with millennials and Gen X consumers most responsible for the growth, according to Danny Brager, senior vice president, beverage alcohol, for Nielsen.

Nielsen sees alcohol category lines “beginning to blur,” and as they do “companies should tailor their approach to each generation with motivators, product attributes, advertising and influencers that fit their preferences and habits,” Brager says.

For spirits buying motivation, the four generations agree on a couple of key preferences and  influencers, reporting a desire for “delicious and smooth taste” and “stylish” products.
Vodkas (both flavored and unflavored) have over the past decade benefited significantly from millennial purchases, while Gen X consumers have increased their share of rum consumption. In the past 10 years, boomers have shifted dollars to vodka and tequila at the expense of some of the other spirits.

More than 20% of millennials claim to consume four (vodka, rum, whiskey and tequila) out of the six spirit segments contained in the survey. Comparatively, more than 20% of Gen X consumers claimed to consume only two (vodka and rum) of the six.

Millennials are most likely to drink spirits for social reasons, while older generations like to consume them alone. When making a purchase, millennials and boomers take stock in well-known and authentic brands, while Gen X consumers are more motivated to buy spirits based on recollection of TV or print ads.

In the wine segment, the sampling of new wines is valuable to all generations, with a key influencer across generations being the ability “to relax,” according to Nielsen. Wine also takes top billing for claims of “delicious taste” and “pairs well with food” compared to beer and spirits.

While wine and spirits are taking off, don’t sleep on beer, Nielsen says. Beer remains the most popular alcohol beverage, with more than 50% of survey respondents saying they’ve bought it over the past three months—the highest for all alcohol beverage categories.

All generations are increasingly trading up to above-premium—including craft—beers from below-premium and premium beers, Nielsen says.

Millennial beer-buying is more social compared to older generations and skews more toward outdoor and holiday occasions, while Gen Xers tend to consume beer at large parties and after-work events compared to other generations, according to Nielsen.

20% - Amount of millennials who claim to consumer vodka, rum, whiskey and tequilla

Source: Nielsen