The U.S. craft spirits market is expected to post a combined annual growth rate of nearly 26 percent through 2022, according to Technavio. The rising demand for craft spirits among millennials and Generation X consumers is a key factor driving the growth of the market, with demand for craft spirits expected to increase at a fast pace among these age groups. This demand will eventually raise the revenue of the craft spirits market in the U.S.
According to Technavio, young consumers seek authenticity in terms of quality and techniques used for manufacturing alcoholic beverages, such as spirits. Millennials and Gen X consumers show a high inclination toward craft products, not only for taste and ease of purchase, but also because they want to learn about the product, its history and the manufacturing tradition. Small-batch products are rising in popularity, as one in seven new products introduced in 2016 were craft or small batch spirits.
In terms of variety, the craft whiskey segment led the market in 2017 with a market share of more than 37 percent, followed by craft gin and craft vodka, respectively. The craft vodka segment is expected to show the highest incremental growth during the forecast period, followed by craft gin.