The consumption of rum in India is on the decline for the past few years. The major reason for the decline is not much evolution in India rum market as observed in India whisky market. While the growing popularity of white beer and cocktails would a little stabilize the market. According to the report ‘India Rum Market Overview, 2018-2023’ published by Actual Market Research, The Indian rum market size by volume saw a decline by a negative CAGR of around 1% from 2011-12 to 2016-17. The declining consumption is the result of less evolution of the rum market.
The market still lacks variants and the consumer is demanding something more, better, or different now. The growth of different alcoholic beverages has led to the switching of Indian rum consumers to other drinks. Rum is further segmented as Dark rum, White rums, and others. where the white rum is an old segment and accounts for the highest market share in the rum market and is observing a high decline in consumption too. Whereas White rum is an emerging category and may grow high soon. While the other rums are also gaming popularity.
The firms in the Indian Rum market are focusing on premiumization and are introducing new brands in their premium segment. The only way for them to survive is to convert their consumer from regular brands to premium brands despite losing some consumers, as premium brands provide better profit margins compared to regular segment brands.
Foreign players like Bacardi have only focused on the premium segment by not launching any regular segment brands. Where the market leader Diageo India launched Captain Morgan Original Rum which is a premium variant of the Captain Morgan Spiced Rum sold by them. Premiumization is still taken a long time, as the Indian rum segment has traditionally been a price-sensitive category and the more premium rum gets in terms of pricing the price may come close to other Alcoholic beverages which may reduce the sales.
The emerging category of Indian rum market is white rum. White rums generally have very little flavor aside from a general sweetness. White rums are filtered after aging to remove any colour. The Indian white rum market is observed to be growing with increasing cocktail culture. White rum is growing as a popular ingredient in many popular cocktails. With an increasing bar and pub culture in India, the consumption and popularity of cocktails are rising which would boost the sales of white rum in India and may help to reduce the rate of decreasing rum consumption and hence provide some stability.
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