RTDs up 14% in US as Spirits Fall in 2025

Why It Matters

The shift toward spirit‑based RTDs signals a profitable pivot for brands amid declining traditional spirits, reshaping distribution strategies and investment focus in the U.S. alcohol market.

Key Takeaways

• US spirits volumes fell 4% in 2024, while spirit‑based RTDs rose 14%
• Malt‑based RTDs declined 5%; overall RTD market down 1%
• National spirits, led by soju, grew 18% despite sub‑1% market share
• IWSR forecasts US soju CAGR 16% through 2029, spirits down 2%
• Only Nevada saw total beverage alcohol volume increase, up 4%

Pulse Analysis

The 2024 IWSR US Navigator shows a stark divergence within the alcoholic‑beverage sector: while total spirits volumes slipped 4%, spirit‑based ready‑to‑drink (RTD) cans surged 14%. Brands such as Constellation’s High Noon vodka‑iced tea have capitalized on the convenience‑first mindset of Millennials and Gen Z, pairing premium‑grade spirits with sweet mixers in a single‑serve format. This growth outpaces the modest 1% overall RTD increase and reflects a broader premiumization trend, where consumers trade a full‑size bottle for a higher‑margin, on‑the‑go product.

At the same time, the market for malt‑based RTDs contracted 5%, and total beverage alcohol (TBA) fell 5% across the United States. Affordability pressures have forced drinkers to reduce frequency and portion size, a pattern echoed in every state except Nevada, where TBA rose 4%. Beer suffered a uniform 6% decline, and wine slipped in all but West Virginia. These mixed state results suggest localized resilience—Minnesota, Idaho, and Oregon posted modest spirit gains—yet the overall trajectory points to a tightening consumer purse.

Looking ahead, IWSR projects Korean spirit soju to expand at a 16% compound annual growth rate through 2029, even as overall US spirits volumes are expected to dip another 2%. Soju’s rise, driven by its low‑calorie profile and versatile flavor base, offers a new growth engine for spirit‑based RTDs. Producers that can integrate soju or similar neutral spirits into ready‑to‑drink formats stand to capture shifting consumer preferences and offset declining traditional categories. Investors should watch distribution agreements and brand‑building initiatives in this niche as a bellwether for the next wave of alcohol innovation.