Until fairly recently, gin was considered an “old person’s drink” here in the U.S. But those days appear to be firmly behind us, thanks to the craft cocktail revival of the early aughts, and the increasing popularity of drinks like the Martini and Negroni.
The Covid-19 pandemic and its stay-at-home order only accelerated gin’s journey from professional back bars onto home bar carts nationwide, with volume sales swelling by 2.5 percent to reach just under 9.3 million cases in 2020. The following year, the category grew again, with approximately 10 million cases sold in the U.S. While the market has somewhat leveled off since, with an estimated 9 million cases sold in the U.S. last year, gin continues to battle it out on American soil. And there’s one key subcategory — and one crucial group of consumers — that has the potential to maintain its momentum.
Younger demographics like Gen Z and millennials are increasingly opting to spend more per bottle on spirits at retail, even though they claim to be drinking less overall. This interest in higher-end spirits has spurred on distillers, which have put out new, often experimental, bottlings that depart from the standard London Dry style and push the category into exciting new flavor territories. Meanwhile, in the on-premise, gin cocktails are hotter than ever before in living memory. All of which seems to suggest the perfect storm is forming for gin to win big with America’s young drinkers.
Premium Gin Is Coming for the Crown
Spurred in large part by the cocktail revival, consumers care more than ever about the quality of spirits that wind up in their glasses. Over the past two decades, we’ve witnessed increased premiumization across all categories and styles of alcohol. Gin is no exception, and while the trend may be slowing for the overall spirits industry, it’s not likely to taper off any time soon in the gin space.
According to the Distilled Spirits Council of the United States (DISCUS), while gin volumes were down by 8.7 percent in 2023, the super-premium segment (bottles that retail for more than $28.30) swelled by 16 percent. The losses in the overall category were instead due to declining interest in the value (less than $12), premium ($12 to $19.50), and high-end premium ($19.50 to $28.30) segments.
“The gin segment has experienced a renaissance, from high-quality, locally made products boasting nuanced botanicals to established brands from abroad making their way into the U.S.”
It’s a trend that’s likely to continue for the foreseeable future. According to data and analytics company IWSR, U.S. gin volumes in the premium price band ($22.50 to $29.99, by their metrics) declined by 5 percent in 2023 and are expected to continue falling at a CAGR of -1 percent through 2028. However, the super-premium ($30 to $44.99) and ultra-premium ($45 to $99.99) tiers are expected to grow at a CAGR of 10 percent and 12 percent, respectively.
Most of this projected growth could be associated with future brand presence on social media, where young consumers scroll in droves. Take Empress 1908 Gin, which was launched in the U.S. in July 2017. With a hue that changes from violet to pink or blue depending on what it’s mixed with, Empress’s eye-catching appearance made it an instant hit on Instagram. Today, Empress is the second most imported gin in the U.S. (Hendrick’s takes the crown), moving 133,000 9-liter cases in 2023, a 44.8 percent increase year-over-year, according to Impact Databank.
It’s not just vibrant colors attracting consumers to gin, though. It’s also unique botanical bills that allow room for exploration, and conglomerates are realizing the category’s full potential.
In 2020, Diageo scooped up Ryan Reynolds’ Aviation Gin (founded in 2006 by Christian Krogstad and Ryan Magarian) for $335 million, with a further payout of up to $275 million. The deal mirrored Diageo’s acquisition of George Clooney’s Casamigos tequila brand, and it proved to be savvy. From 2020 to 2022, the New Western Dry gin was one of the fastest-growing gins in the U.S., growing by 38 percent in volume sales.
“Younger people have grown up in an era of far more variety in cocktail bars and restaurants than generations past, and that’s led them to be more adventurous. They’re also less tied to a specific spirit and willing to try new things. Gin is often that step people take from drinking vodka.”
Just two years after the Diageo deal, Brown-Forman announced its purchase of the Mediterranean gin brand Gin Mare, marking the company’s first acquisition since 2019 when it purchased bartender favorite Fords Gin. That same year, Austin-based Milestone Brands picked up Empress 1908, and in April 2024, Spirit of Gallo announced that it would be the sole U.S. supplier of innovative Mexican gin brand Condesa Gin. Five months later, John Paul DeJoria, the billionaire founder of Patrón Tequila, purchased Waterloo Gin, the first gin brand distilled in Texas.
“The gin segment has experienced a renaissance, from high-quality, locally made products boasting nuanced botanicals to established brands from abroad making their way into the U.S.,” says Adam Rogers, research director for IWSR. “But it will take time for the premium-plus segment to hold enough share of the market to lead the overall gin category into a volume of growth trajectory.”
Time it will certainly take, but these higher-end categories have already stolen a notable share of the market. According to DISCUS, the value and premium segments accounted for roughly 80 percent of gin’s volume two decades ago. By comparison, the two categories represented 61.5 percent of the market in 2023.
Gen-Z or Gin-Z?
If the high-end gin segment is to expand further, the best opportunities likely lie in the on-premise, where gin-based cocktails are increasingly popular and younger consumers abound.
When considering the spirits most enjoyed by younger drinkers, vodka and tequila are easy choices for their associations with party culture. But Gen-Z isn’t partying like previous generations. While the majority of the generation is still under the age of 21, those who have come of age report drinking less at their age than their millennial, Gen X, and baby boomer counterparts. (This data is reliant upon self-reported information from Gen-Z consumers, not actual transaction data.) But according to the IWSR, when they are drinking, they’re drinking cocktails — and white-spirit-based cocktails at that.
“Dive into any cocktail book and you’ll find gin accounts for a huge percentage of the drinks. Given the way home bartending has exploded, it’s no surprise that [gin’s] popularity is rising.”
Gin-based cocktails currently account for 17 of the world’s 50 most popular cocktails, the most from any spirit category. The Negroni, one of the most famous gin-based drinks, currently occupies the No. 1 spot. In the U.S. specifically, classics like the Negroni, Martini, Gin Fizz, and Tom Collins all rank in the top 25 most popular drinks ordered at bars and restaurants according to CGA’s on-premise consumption report from September 2024.
The public’s enjoyment of these drinks is having a real impact on sales. From September 2022 to September 2023, the botanical spirit’s growth outpaced tequila, whiskey, and vodka, three of the largest categories on-premise. Gin was the only spirit to achieve a volume increase in the 52-week period, with tequila down 0.8 percent, whiskey down 2.7 percent, and vodka down 3.4 percent. The primary driver of gin’s gains? Gen Z and millennials.
“Younger people have grown up in an era of far more variety in cocktail bars and restaurants than generations past, and that’s led them to be more adventurous,” says Tyson Buhler, beverage director for Gin & Luck, which oversees the pioneering cocktail bar Death & Co’s Denver, Los Angeles, New York, and Washington, D.C., outposts. “They’re also less tied to a specific spirit and willing to try new things. Gin is often that step people take from drinking vodka.”
As highlighted in data from CGA by NielsenIQ’s monthly On-Premise User Survey, published this September, 42 percent of gin drinkers at bars and restaurants are aged between 21 and 24. By comparison, just 34 percent of drinkers generally opt for the spirit. The report points out that drinkers in this age cohort are more likely than consumers in other age groups to visit “the fastest-growing and most influential venue types” like airport, hotel, and cocktail bars. In short, they’re more likely to drink at places like Death & Co, where gin-based cocktails rank among the best-selling items.
“Gin cocktails, specifically sour-style drinks, have consistently been some of our top sellers at all locations. In the past year, they’ve consistently been in our top three,” Buhler says. “In the last six months alone, each bar’s top-selling gin cocktail has accounted for just under 8,000 drinks sold total.”
“Future growth of premium-plus gin is likely going to be driven by celebrity endorsements and increased awareness in local craft products.”
While most of the gin category’s growth is taking place on-premise, as younger consumers become acquainted with these classics and their prominence on menus expands, buying a bottle of gin for an at-home bar cart isn’t an anomaly — it’s an expectation.
“As people find their way into classic cocktails, gin is usually the start as it historically accounts for the greatest number,” Buhler explains. “Dive into any cocktail book and you’ll find gin accounts for a huge percentage of the drinks. Given the way home bartending has exploded, it’s no surprise that [gin’s] popularity is rising.”
Since 2010, Google searches for gin cocktails have steadily increased, with a predictably massive search volume spike in April 2020 that persisted until the end of the year, in line with gin’s sales increase. But while gin’s overall fortunes have slowed, premium-plus sales have not, and drinkers continue to seek out the best gins to use in their cocktails at home.
At-home bartending with gin has been further encouraged by young social media mixologists like Collete’s Cocktails (@colletescocktails) and influencers like Lex Nicoleta (@lex_nicoleta) who make their Martinis with gin. Hannah Chamberlain (@spiritedla) has also brought many consumers into the fold by sharing dozens of recipes for gin-based cocktails, each of which garners thousands of likes.
While these creators often prepare cocktails with various other spirits, including ever-trending tequila and bourbon, the regularity with which gin drinks feature should not be discounted. According to marketing research firm KS&R, 77 percent of Gen-Z and 50 percent of millennials follow social media influencers, making the two groups the most likely to interact with and follow the lead of those in their feeds.
More Time Will Tell
It’s clear that gin is gaining favor in the cocktail realm, but it remains to be seen whether it will ever compete with whiskey — and, to a lesser extent, agave spirits — as a sipping spirit.
“Whiskey and tequila, while certainly mixed with, are also marketed as a spirit to enjoy on its own or with ice,” Buhler says. “That greatly expands the number of people and different scenarios in which people are going to drink that spirit.”
Yet, the lack of applications for gin outside of mixed drinks could prove to be a non-issue, especially if Gen Z and millennials continue to shift their consumption away from shots and in favor of shaken or stirred concoctions. Overseas, particularly in Europe, gin hasn’t competed on the neat pour front — nor has it had to.
“Future growth of premium-plus gin is likely going to be driven by celebrity endorsements and increased awareness in local craft products,” Rogers explains. “[But] never has there been so many options in the U.S. with a plethora of differing attributes and taste nuances.”
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