Spirits - Indonesia

The Spirits market in Indonesia is experiencing significant growth and development in recent years.

Customer preferences: Indonesian consumers have shown a growing interest in premium and high-quality spirits, such as whiskey, vodka, and rum. This shift in consumer preferences can be attributed to increasing disposable incomes and changing lifestyles. As consumers become more affluent, they are willing to spend more on luxury products, including spirits. Additionally, the younger generation in Indonesia is increasingly experimenting with different alcoholic beverages, leading to a rise in demand for a wide variety of spirits.

Trends in the market: One of the key trends in the Indonesian spirits market is the rising popularity of craft spirits. Craft spirits are gaining traction among consumers who appreciate the unique flavors and artisanal production methods. This trend is in line with the global movement towards craft and premium spirits, as consumers seek products that offer a more personalized and authentic experience. As a result, we are witnessing the emergence of local craft distilleries in Indonesia, producing spirits that cater to the preferences of the local market. Another trend in the Indonesian spirits market is the increasing demand for flavored spirits. Flavored spirits, such as fruit-infused vodka and spiced rum, are gaining popularity among consumers who are looking for innovative and exciting flavor profiles. This trend is driven by the desire for new taste experiences and the influence of international trends in the spirits industry. As a result, both local and international spirits brands are introducing a wide range of flavored options to cater to this growing demand.

Local special circumstances: Indonesia has a large and growing young population, which is a key factor driving the growth of the spirits market. Young adults are more open to trying new products and experiences, including different types of alcoholic beverages. Additionally, the increasing urbanization and Westernization of Indonesian society have contributed to the growing acceptance and consumption of spirits.

Underlying macroeconomic factors: The Indonesian economy has been experiencing steady growth in recent years, accompanied by rising disposable incomes. This has led to an increase in consumer spending, including on luxury goods and alcoholic beverages. Additionally, the tourism industry in Indonesia is booming, attracting a large number of international visitors who contribute to the demand for spirits. The combination of a growing middle class, increasing disposable incomes, and a thriving tourism industry creates a favorable environment for the growth of the spirits market in Indonesia. In conclusion, the Spirits market in Indonesia is witnessing significant growth and development due to changing consumer preferences, including a shift towards premium and high-quality spirits, the rise of craft and flavored spirits, and the influence of a young population and growing economy. These factors, along with local special circumstances and underlying macroeconomic factors, contribute to the positive outlook for the spirits market in Indonesia.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.