Several major players in the industry have seamlessly shifted their focus to offer premium category products to the consumers, with a few shedding non-premium brands to another enterprise, clearly marking the rise in such a trend. It also shows that the industry realises the potential and the growing awareness for high-quality and ethical products.


The rise in income for the middle class over the last decade has given them access to experience global brands at the nearest retail outlets that have, in turn, upgraded their stores. These upgraded stores offer their customers an experience of premium quality of service and premium feel, which is on par with duty-free stores across international airports. The millennials in India are exposed to such experiences quite early. Being a rising force in the country who drive themselves hard during work and are armed with purchasing power, the millennials expect best-in-class service. At the same time, the taboo over the consumption of alcohol is fast receding. More than ever before, while the consumers’ choice shifts to premium products, there has been a marked change in how they perceive consuming alcohol as the pandemic allowed them to experience them from home. It is no longer seen as a taboo to either consume alcobev at home or serve their guests at social gatherings. This has led to an exciting trend egging the consumers’ curiosity about the products they consume, trying to discover stories behind the brands, and allowing them to use the information as part of drawing-room conversations. 

Additionally, post-pandemic premiumisation is witnessing higher growth as there is a higher appreciation for unique experiences over the third place (OTTP) at home. According to estimates, the growing affluence among the middle class is expected to witness a 10 per cent increase a year in the $ 55 billion liquor market.

But there are challenges ahead for the manufacturers. Manufacturers haven’t been able to get a nod from respective state governments to increase their supplier price of products for nearly 5 years in a row and the burden of inflation on all input materials is making it tough for the industry to sustain its operations. 

After corporation tax, excise duty is the second largest source of revenues for various state governments. Hence, imposing prohibition will nearly cripple their source of income. Consequently, most state governments have maintained a status quo which can only hurt them and the sector. 

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