The vodka category is facing a number of challenges in markets around the world, from long-term decline in traditional destinations to threats from dynamic rival spirits sectors in Western countries, a new report warns.

Released last week, the Global Vodka Insights report from just-drinks and the IWSR illustrates the complex nature of current trends in vodka, with traditional, high-volume countries continuing to decline, but higher-priced brands still displaying some growth potential.

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While global vodka sales in 2016 fell 3.4% to 461.3m cases, standard-and-above products grew by 2% to 133.6m cases, reversing the declines of the year before.

The next five years are poised to mirror these trends: while declines for the overall category are set to accelerate slightly, slow growth will continue at higher price-points.

Much of the volume decline comes from Russia, the CIS countries and Eastern Europe, but the report sees worrying signs of stuttering growth in previously buoyant Western markets.

In the US, the flavoured market has been hit hard in recent years, while rivals such as whisky and Tequila are currently doing a better job of engaging with consumers – especially Millennials.

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Vodka remains the largest spirits category in Europe, but growth has proven elusive since 2008, mainly thanks to contractions in the large Polish market.

Nonetheless, declines are now forecast in the UK, and the report warns that, if vodka does not “grow up”, developing new ways of showcasing its distinctive characteristics and evolving a fresh innovation agenda, it risks being left behind by trendier rivals such as gin.

Global vodka insights – market forecasts, product innovation and consumer trends – Click here for full details

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