2025 will do doubt be the year the drinks industry truly feels the repercussions of the global and UK economic climate, political turbulence at home and away, and the duty hikes threatened for such a long time coming into play. While inflation has seen a gradual reduction over the last 18 months, the increase in interest rates and the knock-on effect this has on household expenditure will continue to be a theme as we head into 2025. We may see some prosper, but for many, it will be a year of adaptation, change and resilience. However, as an industry, we innovate, shape tastes and trends, strive to deliver world class drinks to the on-trade and retailers, and find ways to drive pockets of growth.
2025 will not be easy, but it will be interesting and there are areas of growth shaping the industry during the year ahead.
In the Bag (In Box)
The conditions for this still-emerging format are ripe for success, with producers, brand owners and retailers investing in quality of liquid, innovative packaging and campaigns that educate the shopper on the format’s virtues. However, there is still some way to go and in 2025 we’ll see the industry invest more in communicating the quality and longer shelf life of bag in box wines, their value to cash conscious shoppers and how they meet the needs of those moderating alcohol consumption.
The industry, brands, press and influencers are waxing lyrical about bag in box wines, and slowly but surely the format is shaking off its reputation as a ‘cheap’ alternative.
Data shows that consumers are switching on to wines in this format, so we must embrace what they offer; recyclability, affordability, and longer lasting wine. New consumers to the bag-in-box category realise the benefits in terms of convenience, freshness, quality and some environmental benefits to glass, such as lower CO2 emissions.
Kingsland Drinks expanded its Campaneo range with the addition of new, convenient 2.25L Bag in Box (BiB) format recently, which extends the offering into new parts of the market. In anticipation of demand, the employee-owned drinks firm also upgraded its overall filling capacity to 180 million litres on its production lines, spanning various sizes from 187ml up to 3L, formats such as bottles, cans and boxed wines, and liquids ranging from no and low, spirits, and red, white, rosé and sparkling wines.
Go low
Volume sales of low alcohol drinks almost doubled in 2023 and IWSR expects considerable growth over the next few years (particularly driven by low-alcohol beer but across the category).
The rise in duty has ensured it’s in everyone’s best interests to bed in low and no alcohol brands for the long term. It’s good news for the industry, who have responded with a wave of innovation that excites consumers. Importantly, this segment is getting better all the time. In the last 12 months we’ve seen wine and spirits producers up their game and elevate the taste the credentials of the liquid.
In the year ahead, we’ll see this segment continue to soar, as lower and no abv wines and spirits earn their place on fixtures and consumers respond by integrating into their shop. However, quality will be key – in the year ahead it’s important style, substance and price work hard together to nurture growth in this segment and ensure it reaches its potential.
Andrew Peace has worked tirelessly to craft wines at 11% abv which give consumers a great tasting wine while maintaining a great value price point. We’ve seen a considerable number of listings at 11% abv and lower, but some haven’t hit the mark in terms of quality. The new additions to the Andrew Peace range have helped to drive seen significant market share growth up 22.6% value and 17.6% volume, in a backdrop of 7.3% volume decline in the Australian category in the latest 12 months (up to 2nd September).
Kingsland Drinks started packing non-alcoholic wines and spirits in 2019 and is now responsible for developing and launching some of the market’s leading brands. The company currently blends and bottles non-alcoholic gin, rum, whisky, tequila, and still and sparkling wines, using world class technology and controls to ensure the highest possible quality assurance standards.
Mind the gap
Mindful drinking is making its way into the mainstream, with consumers sustaining a ‘drink less but better’ mindset. In 2025 we can expect this will clash with an increasingly price sensitive shopper, who will search for brands that meet their needs on all fronts: budget, status, taste, quality, format and social currency.
Lesser-known becomes bigger business
Consumers are already taking a leap into the unexpected and branching out in their wine buying, with Eastern Europe in particular getting the recognition it deserves for the region’s wine quality, craftmanship and winemaking credentials.
This year we expect Eastern European wines to become much more prevalent in the UK, and demand for Bolgrad from Ukraine, Bediani from Georgia, and Salcuta, a Moldovan Feteasca Negra to sustain their play to consumer interest in lesser-known varietals. The wines from these producers were recognised by retailers for their authentic, distinctive, credible, well-made properties in 2024, and really demonstrate the breadth of wines available Eastern Europe.
Greece will continue to be celebrated in 2025. Kingsland Drinks was proud to launch Athlon Nemea into the UK with Aldi UK in 2024, which was met with much excitement from shoppers. Aldi is known for its quality wines from emerging and up and coming regions, and has a shopper that is open to trial new experiences from sources – like Aldi – that they trust.
Our advice for retailers in 2025 is to seriously consider the path less trodden in your range. Wines from the Mediterranean, central and Eastern Europe and beyond across all quality levels and price ranges, will be a real point of interest in the year ahead.
What’s your flavour
It was clear throughout Christmas 2024 that our customers wanted drinks with more flavour profiles to offer shoppers than before. For example, some retailers went from one or two mulled wines on shelf to six or seven. It’s a sign that consumers continue to experiment with flavours - perhaps as a result of experimentation within RTDs - and throughout 2025 we expect a continuation. Shoppers will continue to expand their flavour repertoire, open to trying new profiles.
Jo Taylorson
We have an on-site NPD lab that is best in class at developing spritz drinks, no and low spirits and made wine - we work alongside brand owners and customers to develop drinks in alcoholic and non-alcoholic formats. The team constantly researches and tests new flavour combinations, profiles and liquids. Our insights team expects to see fruit flavours such as pomegranate, watermelon, blueberry and mango come to the fore in 2025, along with drinks containing herbal and botanical flavours such as rosemary and wormwood, and the resurgence of drinks with tomato juice, such as the bloody mary.
Tins to go
Innovation in RTDs has slowed a little, with focus on sustainable, considered, longer-term growth. In 2025 we expect efforts to go towards targeting urbanites and those seeking simplicity and convenience at an affordable price point. Therefore, getting the product right is key as we move into spring and leverage summer, cementing RTDs in shopping baskets and on shelves in convenience stores.
Rum do
In 2025, rum will still be the darling drink and consumer preference will shift towards golden and darker rum expressions, with a warmer, spicier flavour profile.
Rum sales in the UK surpassed £1 billion this year, overtaking whisky, and it’s a category that brings something for everyone – from dark, decadent rums, to spiced variants, through to lighter, smooth easy drinking white rums. While many consumers continue to enjoy the sweet vanilla and caramel flavours of spiced rums, there is also exploration into more nuanced options, such as golden rum as it brings a well-balanced cross between white and dark expressions, aged in oak barrels to give it its signature amber colour and mellow flavour.
Kingsland Drinks partnered with Co-op to launch the retailer’s first Fairtrade golden rum. A show of what’s trending in 2025, and also proof that consumers want to buy into brands and liquid with a social conscience. It’s a Bourbon Barrel Aged Fairtrade Rum, which is a Caribbean coast blend from the Dominican Republic, Barbados and Venezuela. It really shines in a long drink with cola and lime, with ginger beer, and in a long rum old fashioned, a mule and a mojito.
Agave drinks have grown rapidly in retail, but from a small base. It’s still a small market in the UK and growth is plateauing slightly. However, the opportunity remains with the WSTA reporting that 11k hls were sold over the last 12 months (+5 percent) to the tune of £37m (+11 percent) (WSTA October 2024).
Going green
Sustainability continues to be a key focus for us as brands and consumers become more environmentally conscious. Climate change, sustainability and care for the planet are topics that need to stay in the mainstream conversation and remain high on the agenda of all businesses and brands. Consumers are ever more aware of the crisis and informed about actions being taken and changes required.
We’ll see even more developments and a doubling down on alternative formats. We can expect to see more canned wines, bag in box wines, paper-based bottles, and light-weight glass on shelf in the very near future.
No type of packaging is the silver bullet in terms of sustainability, but openly discussing the pros and cons of each packaging format and make the most educated and best decisions possible will bring the biggest environmental and economic benefits in 2025.
At Kingsland Drinks, our commitment to being environmentally sustainable is intrinsic to who we are and how we operate, but we have expanded our wider sustainability work across economy, society and environment both inside and outside the business as a strategic priority. As a result, we launched our Thirsty Earth sustainability strategy which seeks to create a better society and drinks industry for all, now and in the future.
