As the whisky ages longer and the wines ferment finer, an evolving era emerges. Alcohol and Indian society have a love-and-hate relationship. It has been enjoyed in the form of Madeira for centuries but is also often avoided at family gatherings. There were days when drinking alcohol in Indian society was largely secretive and associated mostly with the male population Men have largely enjoyed their drinks either at car-o-bars during weddings or at late-night bars away from their families.
As society’s intellectual and financial dimensions widen, the range of aspirations and indulgences broadens as well. Historically being a cost-sensitive consumer, Indians have started to loosen their wallets for their desires and not just needs. The urban society is gradually progressing up the Maslow hierarchy of needs from safety and security to self-actualization. Increased disposal income and decreased gender disparity have changed consumer behaviour. It has changed the consumer’s approach towards achieving happiness, socialising, and the importance they give to their self-fulfilment. The alcohol industry in India is estimated around $55 Billion in 2024
The economic landscape and consumer spending power have been crucial factors in this change. However, what characterises the present trajectory of alcohol consumption in urban India are the changing behaviours driven by exposure and evolving social norms. Society is evolving from a male-dominant single-earning member to a dual-earning family. Rising income and purchasing power have allowed consumers to spend on their aspirations and not just their needs. A premium bottle is considered a status symbol of their upgraded lifestyle. It is the shifting consumer behaviour, fuelled by acceptance, exploration, and appreciation, that is defining the trajectory of the alcohol industry in India.
The West has been enjoying liquor in various forms for many years. But traditionally, whisky or rum has been a preferred choice of Indian customers and hence occupies a major share of the liquor industry. Drinks regarded as premium, like Irish, Scotch, Gin, or premium Indian single malts, have shown tremendous growth in recent years, especially in metros and Tier 1 cities. Consumers desire to enjoy different flavours and forms of alcohol.
Fine dining and luxury dining have been booming not just in metros but also in Tier 2 cities. This has allowed people to indulge in casual drinks to enhance their outing experience. There is an urge to spend extra for quality and to experience it better. The growth of clubs and pubs has pushed consumers to try a few expensive drinks. Dedicated beer cafes and bars have brought in a variety of experiences for consumers. Alcohol consumption is evolving from a generic choice to a personal preference due to the exposure and choices at their disposal. Gone are the days when a group of friends would share just one type of drink. Urban youth seek products that align with their individuality. Premium bottles have also become a tool to socialise by inviting friends and colleagues to small gatherings.
Swanky and glamorous retail stores across cities have been eye-catching attractions on many prominent roads. Showrooms offer free tastings to consumers, providing them with a personalised experience. This not only highlights changing drinking venues but also emphasises how marketing plays a strategic role in influencing customer preferences. Customers are encouraged to experiment with and savour a range of high-end, pricey drinks by these facilities’ ambience and exclusivity, which creates a symbiotic link between changing consumer expectations and the alcohol industry’s marketing tactics. It ignites the latent need of consumers to experience something beyond their daily routine and satisfies by providing different avenues This has developed a market for unique flavours and brands that otherwise would have struggled to reach the consumer.
The exposure to international markets during leisure and business trips has allowed consumers to explore different types of alcohol. The growth of duty-free shops at airports has been another catalyst to the trend. Fancy and luxurious bottle designs attract everyone’s eye and have become popular gifting options.
The shift and changing behaviour are not just driven by market engines but reflect a changing society. Women, for instance, are one of the key drivers of premium alcohol consumption, making the industry more vibrant. As per a 2019 survey by CADD, the women’s alcohol market was projected to grow by 25%. There were not just more women drinkers, but women were also drinking more. More than 40% of the women aged 18–45 consume alcohol occasionally or regularly in Delhi. This trend has only increased during and after the pandemic. The social gatherings and desire for inclusivity in enjoyment have promoted women’s love for premium drinks like Gin and Scotch. The changing dynamics allow space for more sophisticated and unique drinks, a shift from traditional whiskey drinkers. The differences in the preferences of male and female consumers make the alcohol industry more vibrant. Since these women consumers are largely from higher-income societies, the growth in premium alcohol has been faster.
Alcohol fills the government treasury and hence, industry policies and taxation are dynamic. It varies across the country from state to state. High duties and taxes help the government earn revenues. Of late, governments have been easing the liquor policy and increasing taxes to generate more state revenues. Initiatives like Extending the serving time, increasing licenses, and promoting nightlife have made access to alcohol easy for the urban population. This promotes manufacturers and helps the hotel and dining industry. These measures open new avenues for indulgence and experiencing unique products.
The industry has witnessed not just increased brands with premium products but the introduction of newer premium product lines as well
The increasing demand for premium alcohol will only push the industry to innovate and ideate new products. With rising aspirations and desires, brand loyalty is flickering. The brands need to cater to and satisfy the discerning preferences of high-value customers with unique offerings. The industry needs to maintain the rate of the middle class entering the upper middle class.
In this age of transition, India’s premium alcohol market sits at the crossroads of innovation and tradition, providing a range of indulgences to meet the varied needs and preferences of a changing society. The industry’s transformation is expected to be as diverse and rich as the drinks it serves, as the trip continues and glasses are raised to the future. Cheers to an exciting tomorrow!
