Can canned cocktails revive the booze business?
Young customers are flocking to ‘ready-to-drink’ beverages as other alcohol sales slump
The booze business has been suffering from a post-pandemic hangover for the past couple of years. Now that a lockdown-fuelled boost in home drinking has faded, spirits are enduring a huge sales downturn, wineries are closing at record rates and volumes of beer produced have slumped.
The share of Americans who say they drink alcohol has dropped to a historical low, and even those who do are drinking less amid an increased focus on wellness and an affordability squeeze. US underage drinking has fallen even faster, reaching all-time lows in 2025, leading many analysts to predict — and industry executives to fear — that young Americans were becoming stay-at-home teetotallers.
Listed drinks groups have been swapping chief executives faster than a frat boy throws back shots: Diageo, Brown-Forman, Constellation Brands and Rémy Cointreau have all changed leaders in the past 18 months.
But a ray of hope for the industry is starting to shine through. Despite their later start, Gen Z, those born between 1997 and 2012, aren’t Puritans after all. Some 74 per cent of US Zoomers of legal drinking age report drinking in the past six months, up from 66 per cent three years ago. More Gen Zers drink than boomers and they are not far off the general population rate of 76 per cent.
The youngest generation of legal drinkers just indulges differently, and for companies that cater to their cravings, the good times are starting to roll.
Sales of “ready-to-drink” concoctions of alcohol with soda, juices and other mixers have been shooting up. Drinks such as Surfside’s Peach Tea and Vodka and Cutwater’s Mango Margarita are winning over younger consumers who like the low price, ease of use and innovative flavours.
“They’ve got this ‘I don’t want to drink my parents’ drink’ element,” says Ed Mundy, a drinks analyst at Jefferies.
Alcopops have popped up as beer alternatives before. Gen X had their 1980s wine coolers; the mid-1990s saw the rise of Zima and other carbonated malt-based drinks, and hard seltzer brand White Claw became such a phenomenon in 2019 that there were nationwide shortages.
But never before have canned mixed drinks played such an important role in the industry’s hopes for its future.
Since 2019, US sales in the RTD category have logged a bubbly combined annual growth rate of 11 per cent while overall alcohol sales have fallen flat at minus 1 per cent despite a pandemic-induced boost, according to IWSR, a market research firm. Premade drinks now account for 8 per cent of total US alcohol consumption.
That translates into big bucks: US sales of premixed cocktails have increased more than six times from $489mn in 2020 to $3.8bn last year.
And where the US leads, many expect other countries to follow. Though RTDs currently account for just 1 per cent of UK sales by volume, they have been growing 8 per cent a year since 2019, IWSR says. Research group MFRF projects European sales will more than double in the next decade.
Some of the fizz in the canned drinks market is almost certainly due to the fact they are relatively cheap at a time when customers are feeling pinched by high fuel prices and prolonged inflation.
US restaurants are marking up wine bottles by six times cost, and $20-plus cocktails are the norm at big city bars. But a four-pack of Carbliss Vodka Cranberry goes for $13.50, and a single BuzzBallz Tequila ’Rita sells for $3.99.
“Particularly in spirits, affordability has gotten out of whack,” says Chris Goodchild, a Boston Consulting Group senior partner who works with drinks groups. “If you compare today with 2020, getting a cocktail or a glass of wine is materially more expensive than it was.”
The appeal of canned cocktails goes beyond price. The convenience of premixed drinks meshes well with today’s socialising patterns. Young Americans are drinking more at home or in small groups rather than in the country’s shrinking number of bars and nightclubs. RTDs also fit into “third spaces” — festivals, sporting events — that serve alcohol but do not have the staff to provide a full bar.
Brands are leaning into group fun with packaging that sparks on social media, such as BuzzBallz’s neon spheres and Surfside’s distinctive stripes.
At the same time, canned drinks can also appeal to those concerned about safety and wellness. Pre-mixed cocktails feel more tamper-resistant than a bowl of mystery punch. Individual portions also make it easier to “zebra stripe”, slang for alternating liquor with non-alcoholic drinks to reduce total consumption.
So far, the big spirits groups have largely missed out: The most popular RTD brands are independent (Carbliss, Surfside) or owned by beer and wine companies (Gallo’s High Noon and AB InBev’s Cutwater).
Canned cocktails were seen as low-rent when spirits groups were boasting about their ability to push up prices in the name of “premiumisation”. Spirits distribution networks are focused on liquor stores rather than convenience stores and supermarkets where Gen Z consumers tend to shop.
That is finally starting to change. Sazerac bought BuzzBallz in 2024 and is rolling it out globally. Diageo’s new CEO said last week that canned cocktails are a big part of plans to revive the beleaguered group. A generation of drinkers is picking its tipple of choice. The big spirits makers need to join the party.