RTD market ‘well positioned for growth’

An article published by NIQ in July of this year, noted RTDs were ‘the next big players’​ within the US hospitality market. The report relayed consumers were experimenting with newly introduced offerings as well as craving convenience and a new need for functionality. The article also revealed,  RTD products are reshaping current categories and creating an entirely new one.​

Recent data published by CGA additionally revealed that 43% of people within the UK based RTD market agreed the industry appeared to be, well positioned for growth​ showing that similarly to the US, many UK suppliers have been ‘diversifying drink ranges in order to avoid the risk of dependency on a singular category.’

Trend influences​

Craig Chapman, head of brand at Global Brands which distributes both VK and Hooch, addressed the importance of recognising the market potential for RTD drinks. He told The MA​: "Ensuring availability and a well-curated range was essential for generating sales with younger drinkers.​"

Placing emphasis on the importance of a younger consumer crowd, he continued: "As consumer habits shift, in particular among Gen Z, RTDS are well placed to help engage younger drinkers and encourage increased dwell time and spend.’ According to Chapman, ready to drinks are now significant fundamentals in the on- trade environment with certain flavour combinations noted as regular staples."

Information from The Morning Advertiser drinks list 2023​, similarly reported a positive uplift in both volume and sales of RTDS, with WKD Blue ranked as the leading beverage of choice among consumers. Closely followed by VK Blue and Smirnoff Ice Red, VK Orange & Passionfruit were also placed in the third and fourth spots of popularity.

Alan Sherwood, owner of cocktail bar Little Mercies in North London, shared his thoughts on RTD trends and consumer preference. He stated: “I think there is more understanding and education on behalf of our guests; people are less worried about the theatre of making drinks, and more interested in the quality and speed of service.”

Touching on the convenience of RTDS, he admitted having a ready to drink can line can be “super popular and cut down on prep workload.”  The current RTD offerings at Little Mercies includes both classic cocktails and a core range, Sherwood revealed. With items such as the Moro Margarita and Kiwi Gimlet, both of which have, he claimed have “grown exponentially over the last 12 months.”

Sherwood also revealed he believes the range at Little Mercies will only continue to grow over the coming months as the segment gains popularity. 

According to recent information from Oxford Partnership, The RTD consumer is reportedly between 25 and 34, with a fairly even split across genders. The average consumer is also typically choosing to drink out weekly in the on trade more so than the average GB consumer, and typically fall within a higher monthly spend bracket.

Managing director of BrewDog Distilling Co, Steven Kearsley shared his thoughts on the RTD market. Touching on the growth Brewdog have seen throughout the sector, he stated: “Our RTD business started because we wanted to support our bars in offering delicious cocktails to our customers and we’ve seen demand for them explode beyond our bars and into other channels." He continued: "As consumers are looking for quality RTD options rather than quantity.”

Kearsley explained the RTD cocktail business at Brewdog has expanded rapidly, adding that he predicts increased expansion and future growth throughout the business. He also spoke on the success of the new Wonderland cocktail range, he commented: “The feedback on our Wonderland cocktail range has been superb. An age of RTD cocktail discovery is going to build momentum in 2025 and we’re excited to be a part of it." 

Increased growth​

Oxford Partnership data also revealed watching live sport has impacted growth for the RTD consumer, with range and quality of drinks noted as key contributing factors that are impacting consumer choice. With pre mix consumer groups also over indexing when people were choosing a drink to socialise.

Further Oxford partnership information showed that in comparison to the average GB consumer, drinks promotions have also been more influential for RTD consumer groups. As a result, driving them to eat or drink out typically more within the on-trade market.

Recent information from the BidFood food and drink trends report​ also revealed growth within the RTD market. With ready to drink cocktails significantly gaining traction, and the amount of consumers who were drinking out weekly, rising to 7% throughout last year.

Specifically, Pornstar Martinis were noted as the number one consumer drink of choice according to the report, with 14.2% of people choosing to drink them in RTD form. Mojito was also ranked as the consumer’s least favourite, noted at 5.6% in consumer preference. 

Diageo head of category development Jennifer Runciman provided her opinion on the RTD market, speaking on change in consumer preference and growth throughout the category.

“​At Diageo we have generally seen an increase in demand for convenience and quality when it comes to drinks choices - with two major driving factors which have led to the success of the growing ready-to-drink (RTD) category, which in the off trade, is currently the fastest growing", she said.

Runciman explained RTD'S were growing “four times faster” compared to the entire alcohol category, in comparison to last year. “We also know cocktails are propelling this forward, being the fastest growing category compared to last year, growing 16%", she said.

The head of category development added stocking key RTD brands behind bars and on menus was key to encourage customer exploration within RTD ranges. She added: Vodka forms the base of five out of the top ten cocktails and gin also forms the base of many popular serves, most commonly associated with spritz and long drinks which go beyond the summer trend”. She described both as being “scalable all year round; making them must-haves on a drinks menu.”

Runciman explained RTD options were great alternatives for those “not able to create cocktails from scratch or invest in staff cocktail training.” She also explained that from an efficiency perspective, bar teams are able to quickly deliver consistent high quality offerings with RTDs.

She stated: “With increasing pressures within the hospitality sector, being able to gain back time behind the bar means staff can spend time maximising opportunities elsewhere."

Runciman also detailed RTD's can be a cost effective option for operators that may not have the scope to invest in staff cocktail training, or able to create different cocktail options completely from scratch. She also highlighted the importance of staff having the opportunity to "gain back time behind the bar" which in utilising RTD'S, allows them to maximise their time elsewhere on the premise.