What is it about tequila that has captivated American consumers? The spirit’s sense of place and provenance, for one, as well as its authenticity and the greater availability of high-quality products. Increased interest in Mexican culture and cuisine, including events such as the upcoming Cinco de Mayo holiday and Día de los Muertos (Day of the Dead) in November also contributes to tequila’s allure.
Tequila and mezcal sales remained red hot in the U.S. in 2022 as volume consumption grew 11.6%, advancing to 28.9 million 9-liter cases. Tequila was one of two spirits categories to attain double-digit volume growth last year. Further, the category has been increasing at an average rate of 8.9% in the last five years, now claiming a 10% share of the entire Distilled Spirits market. Tequila was the second fastest-growing spirits category of 2022 and surpassed the Cordials & Liqueurs category to become the 3rd largest spirits category.
Many of the leading brands posted volume growth with almost half at double-digit increases. In fact, six of the top tequila brands ranked within the top 50 of the leading 150 distilled spirits tracked by the Beverage Information Group —Jose Cuervo (No.11), Patrón (No.18), 1800 (No.33), Hornitos (No.42) with Casamigos and Don Julio achieving significant gains to land at the No.25 and No.29 spots on the list for the first time in 2022.
“By any measure, tequila has become a primary catalyst for the spirits industry. Premiumization helps greatly. Rising consumer interest in this category is driven largely by a growing taste for top-shelf bottles”, observes Marina Velez, Research Director at the Beverage Information Group. “It’s a scenario playing out at bars, restaurants, and beverage alcohol retailers nationwide. Ask nearly any employee at one these businesses about who is buying premium tequilas — what is the category’s demo — and the answer is: everybody. Tequila has attracted interest from all walks of consumer life. Everybody has made room in their budget for a nice bottle of tequila”, Velez continues.
What is the biggest tequila trend in 2023? More growth potential. Interestingly, a category development analysis illustrates future growth potential can continue for tequila in well over half of the states. However, the one factor that could decelerate its meteoric success—the possibility of tequila shortages. Negative consequences are visible on retail shelves today. Stocking certain tequila brands has become more difficult. Concern exists in some parts of the industry regarding over-farming agave to match the increasing consumer demand. Extreme weather during the past few years in Mexico has hurt crop production of the base and main ingredient in tequila, coupled with the plant’s extensive maturation periods, has increased the problems and the potential for scarcity of the beloved product.