If the last three calendar years of pandemic life have shown anything, it’s that American consumers are embracing beverage alcohol. Double-digit retail sales of spirits-based pre-mixed RTDs and super-premium Tequilas last year helped fuel a booming at-home cocktail craze that’s poised to accelerate in 2022. In Pennsylvania, sales for high-end spirits grew 52.6% in 2021, and overall Tequila sales increased 61% to $63.64 million, led by luxury brands like Patrón Silver Tequila ($53 a 750-ml.). “We expect Tequila will continue experiencing double-digit growth in premium segments, especially as celebrity brands grow,” says Tim Holden, chairman of the Pennsylvania Liquor Control Board (PLCB).
Among premium-priced beverage alcohol retail sales in Pennsylvania, spirits showed the biggest sales dollar increase, up 23.8% or approximately $103.3 million. This growth can be attributed to the popularity of brands like Jack Daniel’s Tennessee whiskey ($24 a 750-ml.). “Spirits premiumization will continue across the U.S. and in Pennsylvania,” Holden explains. “We even see long-time legacy brands investing in premiumization by rebranding whole lines of products, changing flavor profiles, introducing new products, revamping packaging, and increasing pricing to reposition items.”
Wines also capitalized on upscaling trends in the Keystone State last year as ultra-premium offerings led all segments with 24.4% growth, up more than $19 million. The three top-selling wines in Pennsylvania in 2021 were La Marca Prosecco ($17 a 750-ml.), Cavit Pinot Grigio ($15 a 1.5-liter), and Kendall-Jackson Vintner’s Reserve Chardonnay ($15 a 750-ml.). “People are drinking better wine at home and going out less, and with the pandemic ongoing, we don’t expect these trends to change,” Holden says.
At The Wine House in Los Angeles, last year’s top-selling spirits include Clase Azul Reposado Tequila ($200 a 750-ml.), Eagle Rare Kentucky Straight Bourbon ($40), and Campari liqueur ($28). “High-end Tequila and whiskies are still on fire,” owner Glen Knight says. “Tequila and Bourbon will most likely not slow down.”
The top-grossing wine at The Wine House in 2021 was the 2018 Opus One ($340 a 750-ml.). Other top-sellers included the 2017 Petra Zingari ($16) and the 2019 Talbott Kali Hart Chardonnay ($16). Knight notes that corporate gift giving also returned. “We are expecting those gifting opportunities to continue in 2022, with awards season right around the corner,” he adds.
He attributes trading-up trends to the rising popularity of e-commerce among The Wine House’s customers, noting that online sales shot up 18% in 2021 over 2020. “We expect this growth to continue as more users see how easy it is to place orders for delivery and curbside pick-up,” Knight explains.
RTDs have also emerged as a catalyst. The Washington, D.C.-based Distilled Spirits Council of the United States (DISCUS) considers RTD consumption one of the top trends impacting the spirits category in 2021. “The RTD category is shaking up the alcohol marketplace and blurring the lines between the traditional beer, wine, and spirits categories,” says Christine LoCascio, chief of public policy at DISCUS.
On the e-commerce front, the PLCB is looking to invest in its online operations with the launch of a new retail platform, as well as resume regular in-store tastings in 2022. “While we may never see the incredible traffic we did during the first months of COVID-19, e-comm will remain a vitally important retail channel for our customers, and we are constantly working to improve the website and processes,” Holden says. “If the pandemic eases to allow in-store tastings again in Pennsylvania, vendors will jump at the chance to host the events, particularly bottle signings with celebrities.”