2022 in Review: Which Beverage Alcohol Predictions Came True?
How BevAlc Insight’s forecast fared for the year’s most impactful trends, categories, and consumer behaviors
Last December, we outlined our predictions for the trends and consumer behaviors that would most impact beverage alcohol sales in 2022, from the growth of hard seltzer’s competitors and non-alcoholic drinks to the evolution of e-commerce technology. Now that the year is winding down, how did Drizly’s forecast fare?
We reviewed each of our 2022 predictions and analyzed Drizly data and insights from the past 12 months to determine which projections landed and which ones missed the mark.
Tequila Will Challenge Vodka as Drizly’s Second-Best Selling Spirit
Though tequila did not surpass vodka as the second best-selling liquor subcategory on Drizly this year, it did see share gains. Tequila represented 19 percent share of the liquor category year to date, up from 18 percent share during the same time period in 2021. Meanwhile, vodka held steady at 23 percent share.
“Given tequila’s skyrocketing growth in 2021, its continued rise in 2022 remained impressive,” says Liz Paquette, the head of consumer insights at Drizly, “especially relative to the overall size of the category.”
After trending downward for the last couple of years, vodka’s share plateaued in 2022 and prevented tequila from moving into the top slot.
“Vodka’s sustained share this year did come as a bit of a surprise,” says Paquette. “While share may continue to hold steady, retailer outlook for the category remains underwhelming.”
In the BevAlc Insights 2022 Retail Report, only 19 percent of respondents ranked vodka as a category that overperformed their expectations compared to 54 percent for tequila.
Consumers Will Expect More from E-Commerce
As predicted, e-commerce evolved in 2022 to better serve shoppers and retailers as competition heated up in the e-commerce space for beverage alcohol. “This trend will likely continue,” says Paquette. “Consumer expectations increase when they are paying for delivery, particularly as inflation drives price sensitivity.”
Though inflation had a lesser impact on beverage alcohol sales than on other consumer packaged goods, she adds, “It was a factor which was somewhat unexpected this year.”
In the 2022 Retail Report, 73 percent of respondents reported that shoppers are still willing to pay for the convenience of delivery, though 43 percent of retailers indicated that customers are purchasing slightly less-expensive options than they would normally choose.
Non-Alcoholic Drinks Will Continue to Grow
This prediction proved correct as non-alcoholic drinks saw share gains across all three beverage categories, including beer, wine, and spirits. The overall category’s share of total Drizly sales grew 200 percent in 2022 compared to 2021—albeit from a small base, increasing from 0.1 percent share to 0.3 percent.
Non-alcoholic drinks remained among Drizly’s fastest-growing categories year-over-year in 2022, and non-alcoholic spirits currently rank as the platform’s fastest-growing subcategory year to date versus the same time period in 2021.
“Product innovation has been a key driver of this category’s growth,” Paquette notes. “In 2022 to date there are over 120 non-alcoholic drinks brands in the Drizly catalog, compared to 70 in the same time period in 2021.” That represents a 78 percent increase year-over-year.
Hard Seltzer’s Competitors Will See Gains
As forecasted, ready-to-drink (RTD) cocktails—one of hard seltzer’s main competitors—saw significant gains in 2022. Share of total Drizly sales grew 35 percent year-over-year from 2 percent to 2.7 percent.
“As with the non-alcoholic drinks category, product innovation and new entrants were key growth drivers for the RTD category this year,” notes Paquette. “The category grew from 458 brands in 2021 to 570 in 2022 to year to date, which is a 24 percent increase over the previous year.”
While the hard seltzer category remained larger than the RTD category, it did see a share decline year-over-year from 3.8 percent of total Drizly sales in 2021 to 3.1 percent in 2022.
“I would not consider this a decrease in interest in the hard seltzer category, but rather, a slowing of growth,” Paquette explains. “Hard seltzer continues to see strong sales and it represents the largest beer subcategory on Drizly. While we do expect consumers to continue to have more options in the portable/canned drinks category, which includes products like RTDs and hard lemonade, we do not expect to see hard seltzer go anywhere.”
Indeed, in BevAlc Insights’ recent retail report, 49 percent of participating retailers indicated that they plan to carry more hard seltzer products next year.
Consumers Will Buy Local
Last year, we anticipated a surge in demand for local wine, beer, and spirits due to supply chain challenges and shoppers’ desire to support local businesses. The prediction proved correct. In BevAlc Insights’ 2022 retail report, nearly 65 percent of participants cited “locally made” as the reason they intentionally stock certain products.
Gifting Will Keep on Giving
Gift share held strong in 2022 at 10 percent of total sales on Drizly. In addition, the average unit price for gift products increased.
The average unit price of gift orders in the past 12 months reached $46.80, up from $39.20 during the same time period last year. That represents a 16 percent increase year-over-year. Comparatively, the average unit price for standard orders in the past year was $18.80.
“Premiumization was a driver of the average unit price growth as we saw consumers trade up for gift purchases,” says Paquette. “They opted for higher-end categories like Champagne, añejo tequila, and Scotch, leading to higher price tags for their orders.”