LONDON--(BUSINESS WIRE)--Technavio’s latest vodka market in Europe report highlights three key emerging trends predicted to impact market growth through 2019. Technavio defines an emerging trend as something that has potential for significant impact on the market and contributes to its growth or decline.
“The unflavored vodka segment dominated the vodka market in Europe and accounted for a market share of more than 88% in 2014. The high sales of unflavored vodka was one of the major drivers for the market. The market share of flavored vodka will rise during the forecast period because of its increasing popularity and demand from young consumers. Some popular vodka flavors include, apple, coconut, cranberry, caramel, blood orange, mint, honey, lemon, cucumber, lime, raspberry, and vanilla,” said Arushi Thakur, one of Technavio’s lead industry analysts for alcoholic beverages research.
Technavio’s food and beverage market research analysts have identified the following three emerging trends expected to propel the growth of the vodka market in Europe:
- Increased marketing and promotions by vendors
- Increase in demand for flavored vodka
- Rising exports
Increased marketing and promotions by vendors
The vodka market in Europe is driven by innovative marketing and promotional activities of the leading vendors. Most market vendors in Europe are large-sized firms that have international businesses. As a result, these vendors have sufficient capital to invest in marketing and to develop the brand image of their vodka. With growing competition, many companies are launching new varieties of vodka to gain to expand their market share.
However, restrictions and regulations from regulatory bodies on marketing and advertising of alcoholic drinks poses a challenge to vendors' strategies at times. Therefore, vendors are likely to promote their products based on product variety, flavor, calorie content, and packaging. This trend is expected to significantly drive consumer loyalty over the next four years.
Increased market demand for flavored vodka
The concept of flavored vodka is not new, particularly in Eastern Europe, where it is home-made, usually with vanilla, bison grass, pepper, lemon, and other fruits and spices. However, the launch of flavored vodka has emerged as a key strategy for vendors looking to diversify in a highly scattered market. This trend has led to the premiumization of vodka thus increasing the demand for the flavored category.
With the availability of a wide range of flavors, consumers are personalizing their drinks accordingly. Some modern vodka flavors that have become popular among consumers are apple, cake, cherry, chocolate cake, citrus, coconut, espresso, grape, lemonade, orange, sweet green tea, and vanilla.
The export of vodka from Europe has risen by 33% since 2009. The value growth of vodka is primarily due to premiumization and innovation in flavors. Northern and Eastern Europe are considered as the major traditional markets for vodka in Europe with Russia as the world’s largest single market.
However, the highest value vodka market is the US, and it receives roughly half of all European vodka exports. Other important export markets are Canada, Mexico, Brazil, India, and China. Poland is the leading vodka producing country in the EU, with 20% of its vodka produced exported mainly to the US and European markets. Swedish vodka is considered to be the world’s largest exported vodka with exports of over 100 million liters annually, which is around 99% of Swedish production. Exporters comprise well-established global brands as well as small private-label brands. Other important vodka exporting countries include Finland, Lithuania, and Latvia. France and the Netherlands are also important exporters from the region.
Browse related reports:
- Global Vodka Market 2015-2019
- Vodka Market in Nordic Countries 2015-2019
- Global Rum Market 2015-2019
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Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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