Spirits - Africa

The Spirits market in Africa has witnessed significant development and growth in recent years.

Customer preferences: African consumers have shown a growing interest in premium and high-quality spirits, such as whiskey, gin, and vodka. This shift in preferences can be attributed to increasing disposable incomes and a desire for more sophisticated and diverse alcoholic beverages. Additionally, there is a growing trend of consumers seeking out locally produced spirits, as they appreciate the authenticity and uniqueness of these products.

Trends in the market: One of the key trends in the African spirits market is the rise of craft spirits. Craft distilleries are gaining popularity across the continent, offering consumers a wide range of locally produced and artisanal spirits. This trend is driven by a desire for unique and high-quality products, as well as the support for local businesses and communities. Craft spirits also often emphasize traditional production methods and the use of local ingredients, appealing to consumers looking for an authentic experience. Another trend in the African spirits market is the increasing popularity of cocktail culture. As more consumers are exposed to international trends and experiences through travel and social media, there is a growing demand for cocktails and mixology. This trend has led to a rise in the consumption of spirits that are commonly used in cocktails, such as vodka, rum, and tequila. African consumers are experimenting with different flavors and combinations, creating a vibrant and dynamic cocktail scene.

Local special circumstances: The African spirits market is characterized by a diverse range of local and regional spirits. Each country has its own unique drinking culture and traditional beverages. For example, in South Africa, brandy is a popular choice among consumers, while in Nigeria, locally brewed spirits like palm wine and ogogoro are widely consumed. These local special circumstances contribute to the overall growth and development of the spirits market in Africa, as they provide consumers with a wide variety of options to choose from.

Underlying macroeconomic factors: The development of the spirits market in Africa can be attributed to several underlying macroeconomic factors. Firstly, the continent has experienced steady economic growth in recent years, leading to an increase in disposable incomes and consumer spending power. This has allowed more consumers to afford premium spirits and indulge in the luxury of high-quality alcoholic beverages. Secondly, urbanization and changing lifestyles have also played a role in the growth of the spirits market. As more Africans move to cities and adopt Westernized lifestyles, their drinking habits and preferences are evolving. Urban consumers are more likely to embrace international trends and seek out new experiences, including the consumption of spirits. Lastly, the growing tourism industry in Africa has contributed to the development of the spirits market. As more tourists visit the continent, they bring with them their preferences for certain types of spirits and cocktails. This exposure to international tastes and trends has influenced local consumers and contributed to the growth of the spirits market. In conclusion, the Spirits market in Africa is developing and growing due to changing customer preferences, including a demand for premium and locally produced spirits, as well as the rise of craft spirits and cocktail culture. Local special circumstances, such as diverse traditional beverages, also contribute to the market's development. Underlying macroeconomic factors, including economic growth, urbanization, and the tourism industry, further drive the growth of the spirits market in Africa.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.