Is Vodka Still The Most Valuable Spirit In America?
America loves vodka. So much, in fact, that it's been the nation's top-selling spirit for over 50 years. Maybe it's because vodka is the leading spirit in many beloved and iconic drinks, from the bloody mary to the martini. Or because it tends to be a more affordable option at the liquor store, with top-shelf bottles available for around $40 compared to other top-shelf alcohol that sells for upwards of $100 (per Aceves Spirits). Whatever the reason, year after year, Americans reach for vodka above any other type of liquor.
Although vodka is the most purchased, whiskey wins the country's popularity contest. According to a 2022 study by Upgraded Points, whiskey took the lead as the most popular type of liquor in 18 different states — more than any other type of alcohol. So it makes sense that in 2021, U.S. whiskey sat in second place based on sales by value (via Bloomberg).
But despite whiskey's ongoing popularity, the liquor was bumped down to third place in sales in 2022 — and another spirit now inches closer and closer to a complete takeover. So which alcohol category threatens vodka for that coveted MVS (most valuable spirit) spot?
Tequila is quickly climbing the ranks
The truth stands that vodka does indeed still reign as America's favorite. But in a spirited turn of events, tequila has officially taken over whiskey's place as runner-up — and the category is only expected to continue to grow. According to the IWSR 2022 report of U.S. alcohol sales, agave spirits — aka tequila and mezcal — were responsible for $1.6 billion in sales in 2022, accounting for "65% of overall value growth of total U.S. spirits."
So Americans are now spending more money on tequila and mezcal than whiskey, which is surprising since whiskey has always been the fan favorite. But what's perhaps even more notable: tequila didn't just overtake whiskey for the No. 2 most-purchased spot, but IWSR reports that it's also expected to surpass vodka in 2023, making it the alcohol industry's value leader. This would be a huge deal considering the sizeable lead vodka has held for so many years.
Why are agave-based spirits taking the lead?
The agave category is proliferating for a multitude of reasons. One crucial factor is that these alcohols appeal to a wide variety of consumers, with demographics that evenly span across age and gender (via IWSR). Ivan Menezes, CEO of Diageo (which owns Casamigos and Don Julio), explained the company's earnings are because the category "cuts across age segments, it cuts across gender, it cuts across dayparts, the occasion and the nature of drinks. It's not just shots and margaritas as it used to be many years ago." (per CNBC).
That brings us to another driver of growth. Tequila can be enjoyed in so many different variations, whether it's flavored, spicy, blanco, reposado, or añejo — and along with that, there's been an emergence of high-end brands that are meant to be sipped slowly, like many other spirits, rather than poured into shots or margaritas. CNBC notes that these upscale brands are contributing to growing sales.
And speaking of high-end brands, another reason the category is thriving is that so many celebrities have launched their own tequila and mezcal brands. From George Clooney's industry-leading Casamigos to Eva Longorias's Casa del Sol, IWSR explains that these celeb-endorsed spirits allow built-in influencers with massive social media followings, upping their overall awareness.