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Gin no longer tonic of choice; Vodka, tequila raise the bar

India's popular gin and tonic trend is fading. Vodka and tequila are now leading the market. Gin sales have dropped significantly this year. This shift affects both established brands and newer craft gins. Consumers are exploring different spirits. The gin market faces challenges with brand loyalty and competition. Major companies are entering the gin space through acquisitions and new launches. Vodka and tequila have left India's once-boisterous gin-and-tonic party rather shaken and stirred. A Covid-era bestseller among both bar patrons and drawing-room aficionados, gin and tonic has seen its pace of sales more than halve to below 4% in 2024, from 9% a year ago. The pace of deceleration, according to the latest data from industry-tracker IWSR, is starker when one considers strong double-digit growth over the past few years for the fancied drink, paced in no small measure by craft gins that found enviable patronage with party hosts. But now, even Goan craft gins, including Greater Than, Samsara, Stranger & Sons, and Short Story, which started the gin revolution during the pandemic, have slowed despite the small base, indicating cocktail-savvy consumers are experimenting with drinks including vodka and tequila. "When the gin trend started, Goa became a gin factory with small distilleries churning out several brands like a startup," said Amar Sinha, Chief Operating Officer at Radico Khaitan, which owns Jaisalmer gin. "But it is a tough business, especially as you compete with Diageo, Pernod Ricard, and Radico that have distribution and marketing muscle. So their growth got stunted after a while." He added that gin would have its share of backers, but only as a niche premium product. "It cannot match vodka in scale," Sinha said. For many years, Indian made foreign liquor gin brands in the value segment, such as Original Choice and Blue Riband, dominated the gin market in the country. However, over the past few years, their demand shrank as consumers traded up for pricier brands. Suspect Loyalties While startups surely helped in popularising the gin category, consumers of the category are quite fickle and easily switch brands -- and even categories -- within white spirits. "The gin renaissance is slowing down not just in India, but globally," said Sandeep Arora, director, Spiritual Luxury Living, a spirits consultancy. "Unlike whisky, where brands can weave heritage and story into the liquid, gin does not have that same narrative advantage. In India, brands have also been aggressively pushing tequila, and cocktails like the picante are driving bar sales." But building a scalable gin brand in India remains a challenge as craft distillers struggle with tight margins, limited distribution reach, and marketing budgets. In addition, the fickle loyalty of Indian white spirits consumers means they are likely to switch between categories and even between brands. "Startups helped popularise the gin category, no doubt," Arora said. "But this consumer base is fluid. And right now, tequila and vodka are simply more in vogue." As a result, there has been consolidation in the space. Mainstream companies, too, have entered the space either by acquiring startups or launching their own gin brand. For instance, United Spirits, the country's largest alcobev company, acquired a stake in Nao Spirits while Tilaknagar Industries bought Spaceman Spirits Lab, the owner of Samsara. Amrut's Nilgiris gin and Malhar from John Distilleries are more recent toe dips into craft gin by major local distillers.

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