‘Disruptive Innovation’ Key To Reviving The Wines And Spirits Industry

Circana told delegates at this year’s Wine Paris & Vinexpo that the wines and spirits industry is at a crossroads and highlighted the pressing need for reinvention amidst shifting consumer behaviours, economic pressures, and emerging market dynamics.

In his opening day keynote remarks, Ananda Roy, SVP of Thought Leadership Europe and CPG Growth Advisor at the consumer behaviour firm, delivered new insights from his presentation, ‘Wine & Spirits – New horizons in a changing world’. Roy emphasised that ‘more of the same’ is not a viable growth strategy for the industry and that it must embrace disruptive innovation, respect its rich heritage and adapt to new consumer rituals and needs.

Circana’s data analysis reveals that the EU6 alcoholic beverages market, valued at €69bn and representing 43% of all beverage sales, is facing a notable decline in volume sales, down by 1.1%. Wines have seen a 1.9% drop, while spirits have fallen by 4.4%. Despite inflation-driven value growth, organic demand remains weak, signalling an urgent need for industry-wide transformation.

Circana noted that while alcohol volume sales and consumption are declining, the growing demand for premium products, unique experiences, and smaller servings is helping soften the blow.

“Consumers are seeking more than just a drink; they desire experiences that align with their values – health, sustainability, and authenticity,” said Roy.

“Innovation isn’t just about new products; it’s about rethinking how we engage with these consumers, embedding sustainability into our DNA, and making wines and spirits ‘cool’ again. Brands that understand and respond to these needs will lead the future.”

The research also reveals a significant generational shift is reshaping the market landscape. Nearly a quarter of 25-35-year-olds have stopped purchasing alcoholic drinks, with an additional 13% delaying purchases. This trend is fuelled by health consciousness, economic pressures and a growing preference for innovative, functional beverages that offer more than traditional alcoholic options.

While premiumisation continues to be a driver of value growth, the industry is struggling to maintain its momentum. Ready-to-drink (RTD) spirits have emerged as a bright spot, showing a 2.3% increase in volume growth. However, overall innovation has decelerated, with new product launches down 9.2% year-on-year, indicating a need for more dynamic and appealing offerings.

Sustainability is helping drive growth, but challenges remain. While 98% of European retailers commit to sustainable sourcing, affordability and availability are limiting consumer demand. Circana states that integrating sustainability into brand strategies will allow the wine and spirits industry to align with consumer values and drive commercial success.

Meanwhile, the firm believes disruptive innovation is at the heart of the industry’s future. Trends such as canned wines, mood-enhancing non-alcoholic beverages, and personalised, experiential consumption are redefining the category. Leveraging social media and influencer engagement is seen as crucial in capturing the attention of today’s fragmented and time-poor audiences.

To meet changing consumer demands, Circana advises wines and spirits brands to:

1. Reinvent product portfolios: Focus on high-growth segments such as low/no alcohol options, functional beverages and premium experiences.
2. Leverage data-driven insights: Use advanced analytics to forecast demand, optimise promotions and enhance shopper engagement.
3. Strengthen retail partnerships: Collaborate with retailers to align sustainability initiatives and innovate in the RTD spirits segment.
4. Enhance consumer engagement: Shift from traditional marketing to dynamic, social media-driven strategies that resonate with younger demographics.