This rise, a CAGR of 4.6% from 2023 to 2032, is driven by “shifting consumer preferences, notably among millennials and Generation Z, who seek unique beverage experiences with flavours providing novelty and excitement,” the company said in a statement.

The demand for diverse options is fuelling market expansion as producers introduce new flavours, however restrictions on specific additives due to health concerns, labelling standards and age verification processes impact product availability and marketing efforts, which may impact future growth of the flavoured alcohol market growth, the report found.

The report also found that RTD cocktails and pre-mixed beverages “present a substantial opportunity for growth and market expansion”.

The whiskey sub-segment and the pineapple sub-segment of the global flavoured alcohol market accounted for the largest shares of 26.4% and 24.9% in 2022, respectively, projected to continue dominance for whisky and see substantial growth for pineapple by 2032. 

This dominance for whisky is attributed to several key drivers, including ongoing innovations in products, featuring diverse flavours and enhanced product quality. Global manufacturers have increased investments in whisky product research and development, promoting whisky as a protein source with improved digestibility, along with the affordability of whisky for the global middle-class population, the report found.

Pineapple’s growth is mainly due to its tropical and fruity profile which holds wide consumer appeal, making it a favoured choice for flavoured alcoholic beverages.

The flavoured alcohol market in Europe accounted for the highest share of 33.6% in 2022, expected to grow significantly during the forecast period. The dominance of the region can be attributed to the “increasing interest from millennials in craft beers, characterised by a desire for fresh and innovative tastes”, the company said.