Drinks market is splintering
Alcohol demand is fragmenting—some guests still want bottles and stories, others prefer single modern drinks or RTDs, and many are drinking less overall. The briefing highlighted moves such as E&J Gallo buying Four Roses bourbon, brewery closures reflecting changing preferences, and a 12% rise in Australian on‑trade RTD sales as evidence of the shift. (dailymail.co.uk) (spectrumlocalnews.com) (thespiritsbusiness.com)
A California wine giant just bought a Kentucky bourbon icon, even as small breweries in New York are shutting their doors and Australian bars are selling far more canned cocktails. Those three moves point to the same thing: alcohol is no longer moving as one market. (gallo.com) (spectrumlocalnews.com) (thespiritsbusiness.com) On April 2, E&J Gallo said it had finalized its purchase of Four Roses from Kirin Holdings and brought the bourbon brand back under U.S. family ownership for the first time in 83 years. Gallo is best known for wine, so buying a premium whiskey label is a bet that some drinkers still want heritage bottles with a higher price tag. (gallo.com) (usatoday.com) At the same time, New York is celebrating more than 500 independent craft breweries that support 22,000 jobs and generate a $4.8 billion economic impact, while also watching a run of brewery and taproom closures. Spectrum’s April 9 report says established local names have been closing even as the state remains second in the country by brewery count. (spectrumlocalnews.com) The pressure is not just local. The Brewers Association said U.S. craft beer production fell 4% in 2024, and its 2025 year-in-beer recap estimated craft volume would drop by more than 5%, with 434 closings against 268 openings. (brewersassociation.org) (probrewer.com) Then look at Australia, where ready-to-drink cocktails and mixed drinks generated about AU$2.5 billion in bars and restaurants in 2025, up 12% from 2024 and 35% from 2023. NIQ data published this week says ready-to-drink is now the fastest-growing alcohol category in the country’s on-trade and the third-largest by value. (thespiritsbusiness.com) (drinksdigest.com) Those drinks are winning partly because they remove the old ritual. In Australia, 198 million ready-to-drink serves were sold in 2025, 58% of them from draught lines, and the category now takes 15 cents of every on-premise drinks dollar, up from 12 cents in 2023. (thespiritsbusiness.com) (brewsnews.com.au) A bar used to push people toward a pint, a glass of wine, or a full cocktail mixed by hand. Now one customer orders a Four Roses pour neat, another wants a vodka soda in a can, and a third skips alcohol altogether. (gallo.com) (thespiritsbusiness.com) (theiwsr.com) That last group is big enough to change strategy. IWSR said on April 2 that global beverage alcohol is declining in a volatile economy, and its 2025 consumer work found 22% of legal-drinking-age consumers across the top 15 markets had abstained completely in the previous six months. (theiwsr.com) (foodanddrinkbusiness.com.au) In the United States, Gallup found the pullback is strongest among younger adults: 50% of people aged 18 to 34 said they drink, down from 72% two decades earlier. When fewer young customers build their social life around beer, small breweries lose the steady crowd that once made the taproom model work. (news.gallup.com) (brandeis.edu) So the drinks business is starting to look less like one big tide and more like separate lanes. Big companies are chasing premium spirits brands, bars are making room for ready-to-drink serves, and local brewers are fighting harder for fewer occasions and fewer habitual drinkers. (gallo.com) (probrewer.com) (thespiritsbusiness.com)
