India’s youth go for foreign brands, because they don’t trust Indian-made foreign liquor any longer
Indian middle-class, especially the young and the middle-aged, are increasingly giving IMFL a miss and are going for branded foreign spirits instead. Citing India as one the most significant growth drivers, various multinational liquor companies are poised to invest hugely in marketing, brand innovations, expand to new markets within India and are managing their portfolio as per the local needs.
Currently, the revenue from the alcoholic beverage market is estimated at Rs.52,000 crore and is likely to reach about Rs.2 lakh crore during the course of the next three years, said the study released by ASSOCHAM, a premier trade body.
Data suggests that a majority of the educated young in India are becoming devotees of bacchus — but of foreign bacchus — not the Indian variety. The study says the sales of imported spirits including the duty-free travel trade in India is likely to cross the 5 million cases mark and reach about 550 lakh litres by 2015.
Growing at a compounded annual growth rate (CAGR) of about 25 per cent, the imported spirits market in India is currently estimated at about 280 lakh litres and about 3.1 million cases, according to a study, ‘India’s emerging imported spirits market’, says the Chamber study.
The overall liquor consumption in India is growing at about 30 per cent CAGR and is likely to reach about 20,000 million litres in the next three years from current level of about 7,000 million litres.
“Growth of imported spirits in India is largely driven by the spurt in tendency amid young Indian professionals and entrepreneurs to migrate from local brands to international brands,” said DS Rawat, secretary general of ASSOCHAM while releasing the findings.
“With more number of Indians travelling abroad for studying and other professional reasons, their fondness for imported liquor is also rising which is certainly leading to growth in the business as they acquire taste for imported liquor and can afford to buy the expensive spirits from duty-free shops abroad,” said Rawat.
“Besides, growth in the sector has also been fueled by rising income levels, increasing young population, growing number of working women, increasing media penetration and expanding exposure to western lifestyle amid people in the upper-middle income group in India for whom serving expensive liquor reflects their lifestyle and status symbol.”
Wine consumption is achieving the gender parity. India’s wine consumption is likely to reach around 14.7 million litres by the end of 2012 from around 4.6 million litres in 2008 registering a growth of 35 per cent during the course of past four years. The percent of female wine connoisseurs is growing by 10 per cent.
The vodka market alone in India is growing at about 25 per cent annually and is likely to reach 10.2 million cases by the end of 2012 as vodka is emerging as a starting drink for the youth at metros and tier II centres.
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PK Surendran is senior editor at Postnoon.