Total volume and current value sales of alcoholic drinks in New Zealand declined in 2024. A major issue for alcoholic drinks was the cost-of-living crisis, which pressured the budgets of local consumers. During the review period, the RBNZ (Reserve Bank of New Zealand – the central bank) raised interest rates to near 40-year highs in an effort to combat record high inflation rates. The economic sugar high of the early stages of the Coronavirus (COVID-19) pandemic was followed by a crash in economic output over 2023-2024, with New Zealand facing a sustained recession. In response to the pressure on household and individual budgets, many consumers have moved away from alcoholic drinks to save money. This has been visible across the board, including in RTDs, a strong-performing category in alcoholic drinks in the review period. The success of RTDs has significantly influenced the dynamics of alcoholic drinks in New Zealand, but the category has not been immune from the downturn in demand.
The rise of the “sober curious” movement in New Zealand has had a significant impact on alcoholic drinks, with increasing numbers of people revisiting their relationship with alcohol and seeking out healthier, more mindful drinking alternatives. This trend, which embraces moderation and explores alcohol-free living, has been driven by a combination of health-consciousness, a desire for mental clarity and a growing focus on overall wellbeing. In response, many New Zealand wineries and beverage companies have recognised this shift and they are innovating to meet the demand for alcohol-free options. The increase in demand for non/low alcohol beer, wine and spirits has prompted established brand owners to develop alcohol-free lines that still offer a sophisticated drinking experience. For example, Nautilus Estate in Marlborough has created a non alcoholic range that maintains the flavours and complexities of its signature wines, without the alcohol content. Similarly, Invivo Wines has launched a low alcohol version of their popular Sauvignon Blanc, appealing to those who wish to reduce their alcohol intake, but still enjoy the taste and culture of wine.
The competitive landscape of alcoholic drinks in New Zealand is fragmented, owing to the diverse nature of the constituent categories and the unique manufacturing processes across beer and cider, wine and spirits. Owing to their strength in beer, the largest category in both volume and value sales terms, Lion - Beer, Wine & Spirits (NZ) and DB Breweries were the leading players in alcoholic drinks in 2024. They leverage strong distribution, sales and marketing capabilities. These two players also led cider/perry. Meanwhile, Lion headed spirits, while remaining a significant player in wine and RTDs. While there remained a large number of craft brewers present in beer, the economic challenges of high inflation and significantly reduced levels of discretionary consumer spending resulted in a number of prominent local craft brewers, such as Brothers Beer and Epic, going into receivership. This highlighted the difficulties faced by smaller independent operators without the capital structure available to the likes of Lion and DB Breweries.
Channel dynamics for alcoholic drinks in New Zealand are influenced heavily by the performance of the constituent categories. Supermarkets can sell beer, cider/perry and wine, whereas spirits and RTDs can only be sold through specialist retailers. While restricted in what they can sell, supermarkets like New World and Countdown often stock more substantial ranges of beer, cider/perry and wine than specialist retailers. They often engage in heavy promotional and strategic pricing strategies to drive foot traffic in store. However, this has led to allegations in previous years of loss-leading on certain beers and wines, claims which the major supermarket retailers have denied.
2024 was a challenging year for the on-trade channel. In the midst of a severe economic recession, discretionary spending has dropped significantly, resulting in a contraction in overall hospitality spend, according to Statistics New Zealand. This downturn comes despite an increasing number of tourists and population growth, highlighting the challenges faced. Within alcoholic drinks, the effects were more pronounced, with on-trade sales declining strongly in both value and volume terms. Many customers eating out in bars, restaurants and pubs turned away from alcohol, due to both cost and health and wellness considerations.
Alcoholic drinks in New Zealand is expected to see retail volume and retail value (constant 2024 prices) growth over the forecast period. The expected economic recovery is set to drive improvements in discretionary spending levels. With New Zealand experiencing a sustained recession through to the end of 2024, the lowering of interest rates and significant drop in the rate of inflation provide positive signs for the forecast period. The on-trade channel was particularly hard hit in 2024, with a number of closures of bars and restaurants across the country amidst the downturn in foodservice. A recovery is anticipated in the forecast period. For example, on-trade volume sales of wine are expected to rebound as people go out more, although off-trade volume sales are also projected to recover. Meanwhile, consumer preferences within wine are shifting towards non alcoholic options.
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Alcoholic Drinks
Alcoholic drinks is the aggregation of beer, wine, spirits, cider/perry and RTDs.
See all of our definitionsThis report originates from Passport, our Alcoholic Drinks research and analysis database.
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