The beverage industry is undergoing a transformative shift, with Ready-to-Drink (RTD) beverages leading the charge. Driven by convenience, constant innovation, and evolving consumer preferences, RTDs are reshaping the entire landscape, from coffee and tea to cocktails and functional drinks.

The era of intricate cocktail crafting, especially in our busy lives, is fading. RTDs offer instant gratification, pre-mixed with tonic, botanicals or even fruits, ready to be enjoyed with ease. It resonates with the young, urban Indian consumer seeking a hassle-free way to indulge in their favourite spirit.

Craft distilleries and established brands are experimenting with unique flavours and botanicals, catering to discerning palates. The essence of juniper, the freshness of coriander, the zest of orange peel and the tang of hibiscus-infused gin, are innovative concoctions pushing the boundaries of flavour, offering a premium experience in a convenient format. Recent data indicates a 109 per cent increase in RTD cocktail sales, presenting a golden opportunity for convenience retailers to capitalise on changing consumer preferences to help bolster their growth and profitability. The Asia-pacific is expected to observe the fastest Compound Annual Growth Rate (CAGR) in the total cocktails industry. The growth is attributed to the rapid distribution of alcoholic and non-alcoholic drinks through online channels, coupled with changes in consumer lifestyles towards healthier products.

Ready to Drink market is driven by a CAGR of 6.38% projected between 2023 and 2030. This translates to a market expected to grow from approximately ₹61,694.15 billion in 2023 to ₹95,038.88 billion by 2030. This significant growth is fuelled by several factors:

Rising disposable incomes and the growth of e-commerce:

Young Indians have more spending power, driving the demand for premium and innovative products. RTD consumption has grown +104 per cent in the past two years while all other market segments of alcoholic beverages have contracted in their percentage of equivalent volume. E-commerce platforms play a crucial role in the RTD revolution, providing wider access to diverse options and enabling smaller brands to reach a national audience.

Shifting lifestyle trends and experimentation with flavours:

Convenience and exploration are key drivers, making RTDs attractive. The expanding young population further fuels the market’s growth, as more youthful individuals increasingly prefer RTDs for social gatherings, outdoor events and travel. Category evolution in the RTD industry is primarily influenced by developments in alcohol bases and premium product offerings. Indian consumers are increasingly open to trying new and unique flavours. RTD cocktails, available in various flavours, such as cranberry, orange, lemon and passionfruit, are considered the epitome of convenience, with low alcohol content ranging from 4-7 per cent. The market for low Alcohol by Volume (ABV) beverages is gaining traction, driven by health concerns among consumers.

Health-conscious consumers are driving the demand for functional RTDs fortified with vitamins, minerals, probiotics and antioxidants. Traditional Indian flavours are incorporated into RTDs, providing familiar tastes in a convenient format. 

Brands are looking at eco-friendly packaging, locally sourced ingredients and reduced waste, aligning with the values of conscious consumers.

Gin-based RTDs are particularly well-positioned to capitalise on these trends. The juniper berry’s versatility allows for endless flavour combinations, appealing to a broad spectrum of palates. Brands like Beat Cocktails, Incredible Spirits’ Swigger and Salud Beverages are already leading the charge with innovative offerings. Within the spirit category, tequila and mezcal, along with other brown spirits, are driving the growth of traditional spirits. According to NielsenIQ, tequila-based RTDs saw the highest growth at 138 per cent, followed by rum-based drinks at 132 per cent. Another noticeable trend according to recent data is Ready to serve (RTS). Consumers are buying Ready-to-Serve (RTS) cocktails because they want to impress their guests with fancy drinks at home. RTS premium products are popular because they offer high-quality cocktails that guests will enjoy. Even though RTS faces competition from other types of alcohol like tequila and whiskey, it’s also gaining popularity over traditional still wine. This could mean that people are choosing RTS cocktails instead of wine as a different and attractive option.

Regional variations are another exciting aspect of the Indian RTD story. Brands are incorporating kokum and honey, into their RTDs, catering to local tastes. The trend is expected to continue, with regional specialties finding their way into pre-mixed formats.

Spirit-based RTDs have a unique set of challenges, but the category is ushering in a wave of innovation that expands the RTD category’s evolution beyond the recent success of hard seltzer.  Craft distilleries are launching spirit based RTDs made with signature gin or vodka. More brands are working on experimenting with different alcohol bases and local, plant-based ingredients. Non-alcoholic RTDs are also experiencing a boom, fuelled by health consciousness and a desire for experimentation. Brands are offering functional options fortified with vitamins, minerals and probiotics, alongside delicious mocktails in various flavours. It caters to a growing segment of consumers seeking flavourful, convenient non-alcoholic alternatives.

Gen Z is taking over the RTD scene:

Gen Z in India are well versed in experimenting with new products and finding what they like. They crave explosions of taste and bold combinations. RTDs cater to this requirement with infused gins, fruity hard seltzers and spicy cocktails in a can, offering a sensory journey in every sip. They prioritise health, therefore opting for a lower alcohol content and healthier ingredients. RTDs are evolving to meet this demand with low-ABV options, hard kombucha and even functional beverages packed with vitamins and probiotics. Gen Z wants shared experiences and connection with their peers. RTDs are perfect for social gatherings, picnics and outdoor adventures. RTDs are portable, easy to share and eliminate the need for messy mixing, creating a hassle-free way to enjoy their favourite flavours with friends.

While convenience is key, Gen Z values authenticity and personalisation. RTD brands are responding with craft-inspired options, locally sourced ingredients and unique flavour profiles, ensuring each sip feels distinct and exciting. So, brands that understand the flavour-forward, better-for-you and social demands of Gen Z will be well-positioned to ride this wave of innovation and growth.

As RTDs continue to evolve and cater to diverse preferences, they are poised to revolutionise the Indian beverage landscape. They’re not just about being quick and easy anymore. Now, they’re packed with exciting flavours, healthier choices and even made with eco-friendly practices. This transformative trend promises to redefine the future of the beverage market, offering exciting possibilities for both consumers and brands.

About the Author

Ajay, Founder & CEO at Salud Beverages

Ajay Shetty is the founder and CEO of Salud Beverages – an global lifestyle brand that is changing the ready-to-drink landscape. Ajay Shetty’s vision for Salud is a global, aspirational lifestyle brand with its ethos spread across a range of ready-to-drink, alcoholic and non-alcoholic and craft spirits. Alongside the exclusive fashion and lifestyle Salud Merchandise line, and the Salud Sessions music label the brand has also ventured into the music and merchandise industry, and now into cryptocurrency. Salud Beverages, India’s first Gin & Tonic brand, is on a mission to establish itself as an urban lifestyle brand. To capture this market, Salud Beverages launched G&T 2.0 with three different Flavors – original, lavender, and cucumber.