The vodka market - Italy

1.1 Definition and scope of study

Vodka is a colorless alcoholic beverage traditionally produced from cereals (rye, wheat) and potatoes, although other agricultural products may be used, particularly beets and fruits. The vodka market is a sub-segment of the spirits market, i.e., beverages produced from distilled alcohol, consisting of the producers and distributors of the product.

The global vodka market is expected to reach a value of 56.4 billion by 2027 registering a CAGR of 3.3%. The U.S. holds the largest share within the global market, followed immediately by China, whose market is expected to grow at a rate of 5.2% between 2020 and 2027.

In terms of sales volumes, the Italian vodka market, after a period of stable growth, experienced a real explosion in 2019. In particular, this growth seems to be explained by an increasing number of vodka exports, which started to suffer a setback only from 2020, due to the effects of the Covid-19 pandemic. 

On the Italian scene there are competitors operating generically in the spirits sector but also dedicated to the marketing of vodka, some of which are represented by large multinational groups such as Pernord Ricard, others by Italian groups such as Molinari, Branca Intarnational and Illva Saronno. There are also big operators focused on the commercialization of vodka only, such as Russian Stanadard as well as small specialized producers. 

A very important trend in the sector is the greater consideration by consumers of the brand in the process of product choice: unlike other alcoholic beverages where customers' choice is mainly driven by price, in the spirits market, and in particular in the vodka one, it is instead the brand producer of the beverage to play a fundamental role in the choice. Moreover, a great opportunity within this market is represented by the growth of e-commerce as a distribution channel, although physical stores continue to remain the preferred sales channel for consumers.