Alcoholic Drinks - Indonesia

The Alcoholic Drinks market in Indonesia has seen significant development in recent years, driven by changing customer preferences, emerging trends, and local special circumstances.

Customer preferences: In Indonesia, there has been a growing preference for premium and craft alcoholic drinks among consumers. This can be attributed to the increasing disposable income and changing lifestyles of the middle-class population. Consumers are seeking unique and high-quality alcoholic beverages that offer a more refined drinking experience. As a result, there has been a surge in the demand for premium spirits, craft beers, and boutique wines in the country.

Trends in the market: One of the prominent trends in the Indonesian alcoholic drinks market is the rise of the cocktail culture. Cocktails have gained popularity among consumers, especially in urban areas, as they offer a wide range of flavors and unique combinations. This trend has led to an increased demand for spirits such as vodka, gin, and rum, which are commonly used in cocktail recipes. Additionally, there has been a growing interest in mixology, with bartenders and enthusiasts experimenting with new ingredients and techniques to create innovative and exciting cocktails. Another trend in the market is the increasing popularity of non-alcoholic or low-alcohol alternatives. Health-conscious consumers are seeking options that allow them to enjoy the social aspects of drinking without the negative effects of excessive alcohol consumption. This has led to the introduction of a variety of non-alcoholic beers, wines, and spirits in the market. These products cater to consumers who are looking for healthier options or who want to reduce their alcohol intake.

Local special circumstances: Indonesia has a large Muslim population, and Islamic law prohibits the consumption of alcohol. However, the country has a significant non-Muslim population, as well as a growing number of tourists and expatriates who have different cultural backgrounds and preferences. This diversity has created a unique market for alcoholic drinks in Indonesia, with a range of products catering to different consumer segments. The government has also implemented regulations to control the sale and consumption of alcohol, including restrictions on advertising and the establishment of designated drinking areas.

Underlying macroeconomic factors: The Indonesian economy has been experiencing steady growth in recent years, with a rising middle class and increasing urbanization. This has resulted in higher disposable incomes and a greater willingness to spend on premium products, including alcoholic drinks. Additionally, the tourism industry in Indonesia has been expanding, attracting a large number of international visitors who contribute to the growth of the alcoholic drinks market. The country's favorable demographic profile, with a young and increasingly affluent population, also plays a role in driving the demand for alcoholic beverages. In conclusion, the Alcoholic Drinks market in Indonesia is developing in response to changing customer preferences, emerging trends such as the cocktail culture and the demand for non-alcoholic alternatives, as well as local special circumstances including cultural diversity and government regulations. The underlying macroeconomic factors, such as economic growth, urbanization, and the expanding tourism industry, further contribute to the development of the market.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.