Southern Glazer’s Wine & Spirits has released its inaugural Raise the Bar: H2 2026 Edition, a trends report finding that consumers are not walking away from beverage alcohol but changing how they engage with it, with growth emerging in ready-to-drink cocktails, wine cocktails, non-alcoholic beverages, tequila, smaller formats and premium offerings.
The findings carry direct implications for grocers’ beer, wine and spirits sets. While the industry undergoes what the distributor calls a cyclical and structural reset, declines are stabilizing, and shoppers are moving among categories, price points and formats based on individual preferences rather than abandoning the aisle.
“There’s been a lot of focus on what consumers are drinking less of, but that only tells part of the story,” said Zach Poelma, SVP of commercial intelligence at Southern Glazer’s. “What we’re seeing is a consumer who is becoming more intentional and more selective, while still finding new ways into the category. The opportunities are there, but they don’t necessarily look the same as they did five or ten years ago.”
Key findings
The report identifies five opportunities shaping beverage alcohol in the second half of 2026 and beyond:
- Courting the next generation: Gen Z is emerging as a growth cohort, overindexing in spirits and RTDs while increasing its wine spend. Variety packs are outperforming single-flavor packs in RTD cocktails and hard seltzers, a signal for assortment planning as flavor and lower-risk trial bring younger legal-drinking-age shoppers into the category.
- Formats and drink types fueling growth: Spirits RTDs now drive 94 percent of total spirits volume growth, while cocktails account for 92 percent of total wine growth. Smaller formats are gaining as consumers seek convenience, affordability and easier ways to explore.
- Owning the moments that matter: Consumers are changing when and where they drink, making occasions – from everyday consumption to cultural moments – increasingly important. Nearly half of consumers say bars and restaurants are the best place to try a new brand, and that discovery flows back to the grocery aisle: 69 percent of consumers who try a new brand on-premise look for it at retail afterward.
- The barbell advantage: In a K-shaped economy, growth is emerging at opposite ends of the category, from smaller formats and everyday value to premium products. Rather than one dominant behavior, the report points to a market where value and premiumization coexist.
- Winning the moderation consumer: No-, low- and functional beverages are increasingly complementing traditional beverage alcohol rather than replacing it, creating opportunities for expanded occasions and larger baskets as consumers move between alcoholic and non-alcoholic choices throughout the year, not just in January.
What it means at the shelf
The full report quantifies several of those opportunities at retail. Small sizes account for 24 percent of core spirits category dollars but only 12 percent of spirits shelf space, according to the distributor’s Sales Execution Tracking data, suggesting small formats are underindexed at retail even as they drive trial.
In the RTD aisle, most purchases are planned, at 61 percent, but 55 percent of shoppers decide the brand in-store, making cold-box visibility and displays critical to capturing the decision at the shelf. Beer volume growth also is concentrating in specific formats, with 16-oz. 12-packs and 32-oz. and 19.2-oz. singles driving 66 percent of it, while 200ml bottles drive 55 percent of sparkling and still wine volume growth.
The moderation trend, meanwhile, is a basket builder rather than a threat: 98 percent of non-alcoholic and social tonic buyers also purchase traditional beverage alcohol; 73 percent of trips include both; and those combined trips carry $13 more in spend. Retailers are expanding to meet the demand, with Southern Glazer’s non-alcoholic spirits now present in 15 percent of its spirits chain accounts and non-alcoholic wine in 31 percent of wine chains.
The report draws on third-party industry data combined with Southern Glazer’s own depletion, distribution and execution data, including more than 15 million customer transactions annually and 250 million images capturing on- and off-premise execution, providing visibility into markets reaching approximately 95 percent of the legal drinking age population.
Raise the Bar is the first in a planned twice-yearly series from the distributor’s Commercial Intelligence team. Southern Glazer’s, a multi-generational, family-owned company, has operations in 47 U.S. markets and Canada.