The pandemic changed society in ways large and small: working from home and the dominance of Zoom, a rise in board game popularity, and online shopping. Likewise, a powerful impact was felt in the alcohol industry.
In particular, the RTD (ready-to-drink) category underwent major innovation and experienced a concomitant rise in popularity due to the new, at-home sensibility. In particular, more spirit-forward RTD cocktails like Manhattans and negronis, as well as an expansion in long drinks like margaritas and vodka spritzes, started to emerge on the market, and they continue to do so. The height of Covid-19 is just a bad memory now, but RTDs continue to evolve and to be actively integrated into on-premise menus.
Certainly, RTDs are not a new invention. During the 19th century, many bars bottled their in-house cocktails for customers. And, in the 1890s, Andrew Heublein started offering bottled “Club Cocktails” to his hotel guests. By the 1960s, Heublein’s newly dubbed “Clubtails” were presented in cans and included nine drinks: an extra dry martini, Manhattan, whiskey sour, daiquiri, mai tai, screwdriver, margarita, vodka gimlet, and vodka martini. In the 1980s, Bartles & James wine coolers were popular; Zima, a malt-based drink, was introduced in 1993.
RTD alcoholic beverages have come a long way since Zima. According to Fact.MR, the 2024 global RTD market was estimated to be about $18.81 billion in U.S. dollars. By the end of 2034, trends suggest that those numbers will hit $28.76 billion in US dollars.
The types of RTDs are changing too. “Traditionally malt-based categories, such as hard seltzers and hard teas, are undergoing a switch to spirit-based products, premium-izing the offering as consumers become more aware of base and the quality associated with spirits,” says Susie Goldspink, IWSR’s Senior Insights Manager – RTDs and No/Low Alcohol. “The establishment of an easy-to-drink, lower-ABV spirit-based category has now spawned another innovation race, although much smaller than that for malt-based hard seltzers.” According to IWSR, while malt-based RTDs dominated the market around 2021, spirit-forward launches increased from 55% to 67% in 2024.
While constant innovation and new brand launches was the formula for a long while, this flooding of the market has scaled back. According to IWSR’s tracking data, “RTD product launches are increasingly leaning into super-premium pricing, packaging with less plastic, fewer direct health claims and greater diversity of alcohol content.”
This is the case across the world’s main RTD markets: Australia, Brazil, Canada, China, Germany, Japan, Mexico, South Africa, the UK and the US (85% of consumption globally).
As RTDs continue to be developed, this innovation is being strongly driven by Gen Z’s perception of alcohol, which is vastly different than earlier generations. This generation’s curiosity about and openness to new flavors and styles of drinks is making a difference. Likewise, while moderation is a watchword with Gen Z, when they do drink, they are more excited about premium products both in bars and stores.
While commercial RTDs have found a place in many bars, they are doing particularly well in certain large-scale venues. Marten Lodewijks, President of the US Division at IWSR, observed that “the emergence of single-serve canned RTDs has allowed brands to gain ground in venues/locations where glass bottles are typically not allowed, such as sports venues, concerts, and beaches.”
For instance, Surfside, which produces a vodka-spiked hard tea and hard lemonade, is now served at stadiums across the country, including Camden Yards, Citizens Bank Park, and Dodger Stadium. Similar partnerships have been made with the National Hockey League and the National Basketball Association. Surfside’s quick delivery, spirit-based RTDs demonstrate how ready-to-drink serves can find a home in both smaller and larger locales. Likewise, their use of vodka is in keeping with that spirit being the most popular one in the RTD marketplace.
While bartender Achille Moga does not serve commercial RTDs at Library by The Sea in the Kimpton Seafire Grand Cayman, he has taken a cue from the concept. Currently, he is batching in-house RTDs for all the drinks on his menu, as well as putting them in guests’ rooms as an extra amenity. Moga sees many similarities between in-house and commercial RTDs. “Efficiency and consistency matter… and we need to deliver drinks within five minutes of the drink being ordered.” He also thinks that RTDs – commercial or otherwise – excel in the spirit-based category. He cites the negroni and the old fashioned as examples where the focus on spirit means that there’s very little expirable product, making the mixes extremely shelf stable.
For a long time, commercial RTDs were the purview of liquor stores, supermarkets, and the like. Benji Davies, who tends bar at the Hotel Indigo, also in Grand Cayman, believes that the resistance to using commercial RTDs behind the bar came about because bartenders “had a fear of the impact it would have. Would it deter people going to bars and just staying home? Would the art of bartending and theater die out to convenience?” Clearly, this has not happened, and RTDs are being enjoyed both at home and in bars. In fact, Davies has noticed that many of these ready-made cocktails “are so good it's like they have made it in your home”. Among those he finds exceptional are White Box, as well as Little Mercies, and Tayer + Elementary, both found in London.
The spirits-based RTD trend is also driving changes in ABV. While some of these RTDs, particularly vodka soda styles, hover around 5%, much like malt-based versions, the styles that are spirit-forward can run anywhere from 15% to 40%, often mimicking the kick of a drink enjoyed in a cocktail bar. Many high-profile distilleries are now producing cocktails using their proprietary spirits, which adds another layer of premiumization. The combination of a spirit-based cocktail with a higher ABV and a higher price point is becoming a sign of sophistication because it is in keeping with a true in-bar cocktail experience. As mentioned before, the newly emerging LDA Gen Z cohort tends toward moderation, but when they do indulge, they seek out quality and don’t mind paying for it.
According to IWSR’s RTD innovation Catalogue, in 2021, “3,400 new RTD products were launched in the world’s top 10 markets for the category – but by 2024, that figure had dropped to just over 1,800.” Despite fewer new products on the market, sales of RTDs continue to improve.
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