Ready-to-drink (RTD) cocktails are shaking up the beverage scene in the U.S., capturing taste buds with their evolution to keep up with the ever-changing spirits market. This growth is driven by a combination of factors, including convenience, the increasing demand for premium and diverse flavor options, and a shift toward conscious consumption of low-calorie beverages.
The RTD market is striving with innovation, as brands experiment with new ingredients, eye-catching packaging, and eco-friendly initiatives to win over the green-minded drinker. The pandemic has only accelerated the adoption of RTD cocktails as more consumers seek the bar experience at home. As we dive into the latest trends shaking the RTD market in 2024, discover the freshest product innovations, shifting consumer tastes, and the dynamic forces moving this exciting sector forward.
Premiumization and Flavor Innovation
One of the top trends in the RTD market is the premiumization of products (The IWSR). Consumers are increasingly looking for high-quality, spirit-based RTDs over malt-based beverages . This shift is driven by a desire for more complex flavors and higher alcohol content (Beverage Dynamics)
Flavor innovation remains crucial, with consumers gravitating towards unique and seasonal flavors. Autumnal and orchard fruits like apricots, peaches, and apples are being rediscovered, often paired with brown spirits to create sophisticated RTD options. Additionally, the market is seeing a rise in the popularity of savory and herb-infused cocktails, offering complex and balanced flavor profiles (Simpson Beverages). As consumers strive to meet their personal goals, beverage brands have significant opportunities to delve into adaptogens. Traditionally used in tea, these ingredients are now being added to a variety of products, including sparkling waters, ready-to-drink teas, and most recently, cocktails (Beverage Industry).
Packaging and On-Premise Consumption
Innovative packaging formats are also making waves in the RTD market. Single-serve cans remain popular, but there’s a growing trend towards larger formats like bag-in-box and resealable cans, which cater to gatherings and ease of use. Glass packaging is preferred by nearly half of the consumers, especially for premium products (The IWSR). Now, brands are also experimenting with larger-size glass packaging to pour over ice, rather than the traditional single-serve cans & bottles.
RTDs are breaking out of the mold and making a splash in bars and on-premise venues. These are being ordered at trendy experiential bars and airport lounges, with some bars even crafting their own signature ready-to-drink cocktails, some for sale exclusively on-premise, and others making it available for purchase off-premise as well.. This trend highlights the versatility and convenience of RTDs, securing their status as must-haves both at home and in the hottest social scenes. Whether you’re lounging at home or sipping at a stylish bar, RTDs are the go-to choice for a fuss-free drink (MarketWatch and Beverage Dynamics)
The Current Market and a Look Into the Future
The U.S. RTD market continues to grow, with significant year-on-year increases in value. In 2022, RTDs experienced the largest price increase per serving compared to other alcoholic beverages, reflecting their premiumization. Despite a slowdown in the hard seltzer segment, spirit RTDs are thriving, with a forecasted value of $21.1 billion by 2027 (The Spirits Business).
Cross-brand partnerships are becoming more common, as seen with collaborations between alcohol and non-alcoholic beverage companies. These partnerships leverage existing brand recognition and distribution networks, reducing entry barriers and expanding the market reach (The IWSR)
In summary, the U.S. RTD cocktail market is shifting towards premium, high-ABV, and flavor-packed creations. This trend mirrors consumers’ growing appetite for quality and unique taste adventures. Brands are stepping up their game with dynamic packaging that’s not only convenient but also a treat for the eyes and kind to the planet. The resurgence of on-premise consumption—thanks to the reopening of bars, restaurants, and social hotspots—has played a role in the market’s growth. All these factors point to a resilient market that’s only gaining popularity. This exciting landscape promises innovations for both drinkers and producers, as creativity continues to fuel growth and new opportunities in the RTD cocktail category.
