February 25, 2026 – The US spirits market is changing. What is causing the change? Core buyers of spirits are aging out and buying less alcohol. Brands in the US spirits market are reinventing themselves but younger generations are not responding. Generation Z and Millennials spirits trends show that younger generations of US consumers are drinking much less alcohol. In the US spirits market, some US spirits brands have switched to premium strategies that have boosted growth and profits for now, but this effect may not last.
How are generational shifts impacting the US spirits market?
The challenge to the US spirits market is that younger generations are socializing in a different way from older generations and they are not choosing spirits. The Boomer generation, the key generation for drinking spirits, is aging out and drinking less. The mature US spirits market is contracting. The US spirits industry cannot rely on Generation Z because this generation is leaning toward moderation, zero alcohol alternatives, and being sober. Generation Z and Millennials spirits trends show that Gen Z consumers in the US are equally likely to have alcoholic or zero alcohol products when they choose to indulge. Millennials, who have reached a peak for buying power, are moving up to premium and are drinking spirits, so this might help offset the decline in spirits consumption among US Boomers. Millennials over-index for purchasing spirits compared to other generations and a growing number prefer premium spirits to standard options.
Why is premiumization a key strategy for US spirits brands?
Many spirits brands in the US spirits market are leaning on premium pricing to protect and boost profits. Premiumization helps differentiate products in the US spirits market. One way to attract younger generations is with premium brands and also with high-proof spirits that elevate the drinking experience. Ordinary cocktails, whether consumed at home or away from home, can become extraordinary.
But both inflation and tariffs are causing consumers to tighten their spending. Tariffs imposed by the US on imported goods are disrupting the US economy in general and the spirits market specifically. This is because the US spirits market is heavily driven by imports. However, it is possible that US spirits brands that focus on premium products and limited-edition releases could appeal to US consumers who are driven by moderation. These US consumers may be willing to spend more when they choose to buy spirits.
How Does the Trend of Relaxed Sociability Affect Alcohol Consumption?
Socializing today in the US is less formal. It also favors sobriety. US consumers have lifestyles that are healthier and more flexible. Their social occasions are becoming more relaxed. So are the spaces where they socialize. Another force affecting the US spirits market is the move toward better-for-you beverages such as zero alcohol alternatives and functional beverages.
Casual socializing still can have room for premium spirits. One of the consumer trends identified by Innova Market Insights is relaxed sociability. The good news is that about half of US consumer trends research participants say they relax by drinking spirits. But this proportion is down from 2023. US adults also report enjoying spirits in relaxing settings with family and friends.
Innova sees a combination of moderation and premiumization, especially among Millennials in the US. This generation feels that less is better but also is attracted to experiential consumption.
US Alcohol Consumption Spans a Range
In the US, alcohol consumption spans a broad range. About one-quarter of US consumers participating in consumer trends research conducted by Innova Market Insights say that they are cutting back on spirits. Spirits in the US spirits market also face competition from pre-mixed cocktails. Spirits brands that have not incorporated ready-to-drink cocktails into their portfolio will be challenged in the marketplace.
The Future for the US Spirits Market
The future for the US spirits market is mixed, a bit negative and a bit positive. US spirits brands can offer premium products and limited editions that are high ABV and accompany them with the storytelling that resonates with Millennials. Consumers who are shifting to home consumption of alcoholic drinks may view mixology as a form of art and may be willing to experiment with alcoholic beverages. Varied approaches for specific generations, including messaging, storytelling, and experiences, may resonate and spur purchases.
What’s Next for Functional and GLP-1-Friendly Spirits Messaging?
Innova predicts several changes in the future US spirits market. Consumer demand for beverages that are better-for-you will include functional zero alcohol alternatives. Innova expects a rise in private label spirits that are high quality and more affordable. Other changes in the future could include spirits subscription plans with set prices and marketing plant driven by AI. Innova expects to see GLP-1-friendly spirits messaging to appeal to the growing number of US consumers following GLP-1 drug and diet plans. Watch for a focus on sustainability features, including ingredients grown using regenerative agriculture, ingredients that are sourced fair trade, spirits packaging that is eco-friendly packaging, and increased corporate responsibility. Expect to see flavor innovation that connotes relaxation.
This article is based on Innova’s Spirits in the US report. This report is available to purchase or with an Innova Reports subscription. Reach out to learn more.