Australian Gin Consumption: Growth in the Sector

Australia has seen steady growth in the consumption of alcoholic spirits, with sales increasing from 64.4 million litres in 2014 to 66.1 million litres in 2019. The industry is dominated by Diageo Plc who account for over a quarter of sales, followed by Suntory Holdings (10%) and Pernod Ricard (8%)[1] . Whisky remains the largest seller in terms of volume (28 million litres), followed by white spirits (includes both vodka and gin) with 18.1 million litres[2]. Importantly, white spirits have been on an upward trajectory with an average 4.5% cumulative year-on-year volume growth between 2013-18 [3]. This is a remarkable achievement considering that whisky, rum and brandy have all suffered from contraction in volume sales over the same period.

Much of the growth in white spirits comes down to gin. The wide range of products available in the Australian gin segment appeals to a broad range of customers, that span multiple demographics. With the impact of COVID-19 still resonating in our ears, and the growing appetite for homemade cocktails, it is likely that the Australian gin market will continue to grow. Importantly, the frequent release of new products appeals to those that are eager to experiment with new flavour profiles, juniper combinations and botanical aromas. Headlands Distilling Company offers two examples of innovation in the segment with both Boobialla gin (using native Australian juniper) and Daalgaal gin (steeped with Illawarra plums) leveraging these trends. Where Boobialla appeals to consumers wanting to try unique Australian flavours, Daalgaal extends on this trend by coupling unique Australian bushtucker flavours with a visually appealing product that appeals to multiple sensory stimuli.

Interestingly, gin is the most consumed spirit behind whisky, with a recent Roy Morgan survey revealing that 8% of Australians had consumed gin at least once in the previous four weeks[4]. An indicator of the strength of the Australian gin market is demonstrated through consumption patterns among women, who now clearly prefer gin (9.3%) over vodka (6.8%). While these results are promising, we mustn’t forget that the Australian gin market is still dominated by mainstream brands offered by dominant market players such as Diageo and Barcadi (over 4 million litres of gin). Nevertheless, the craft spirits scene in Australia has grown to account for 6% of total spirits volume[5]. With the explosion in craft distilleries, the only way to survive is to differentiate and offer an experience that is unique, yet affords value for money.

References

[1] Alcoholic Drinks: Euromonitor from trade sources/national statistics

[2] Spirits in Australia Country Report, https://www-portal-euromonitor-com.ezproxy.waikato.ac.nz/portal/analysis/related

[3] Cumulative year-on-year growth compares the volume from the current year to the previous year

[4] Interestingly, gin is the most consumed spirit behind whisky, with a recent Roy Morgan survey revealing that 8% of Australians had consumed gin at least once in the previous four weeks.

[1] Alcoholic Drinks: Euromonitor from trade sources/national statistics

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