Take specific action on sustainability issues

Sustainability was top of mind at DISCUS 2022. Several speakers stressed the importance of sustainable product packaging and production processes to spirit consumers. While consumers put their dollars behind sustainable manufacturers, the spirits industry is striving to improve the environment in the process of getting consumers to drink better products.

Ian Somerhalder, actor and philanthropist guest speaker from Brothers’ Bond Bourbon, stressed the importance of getting specific with sustainability initiatives—think “re” words like “regeneration” and “regenerative agriculture.”

Prepare to navigate inflation and a possible recession

With the current state of the economic environment and inflationary pressures, a few DISCUS sessions explored how the spirits industry can navigate a potential recession.

The outlook was generally positive, as the spirits category has historically been resilient in times of economic downturn. Consumers will likely look to familiar brands they have always enjoyed across the beverage alcohol sector and regard spirits as affordable luxuries.

Keep an eye on alcoholic beverage category convergences

As ready-to-drink spirits grow in popularity alongside malt-based and wine-based ready-to-drink beverages, the lines between the beer, wine, and spirits categories continue to blur.

The push for individual states to tax spirits-based ready-to-drink products at the same, lower, rates as FMB and wine-based products, is getting significant time and effort from the lobbying arm of DISCUS. These efforts are state to state in terms of excise tax compliance, and DISCUS has a firm understanding of where the battlegrounds are active and can be influenced.

Embrace digital acceleration and NFTs

E-commerce remains a top concern for spirit manufacturers and distributors, especially as technology accelerates changes in consumer behavior. More recently, CPG products have been attached to NFTs, which are being sold and traded in collaboration with artists and influencers to create limited releases.

Premiumization is not passe

Although inflation is on the rise in the U.S., the “premiumization” of spirits beverages is a driving force in the beverage alcohol sector. NielsenIQ’s Jon Berg, Vice President of Thought Leadership for Beverage Alcohol, presented on this trend, sharing that NielsenIQ data shows that consumers are still willing to pay a premium for the right product. Premium+ in spirits accounts for 69% of total spirits dollar sales, driven by tequila and whiskey.