Alcoholic Drinks in France - 2024 Market Summary
Alcoholic drinks in 2023: The big picture
Sales of alcoholic drinks in France declined in total volume terms in 2023, following moderate growth in 2022 and strong growth in 2021. Factors contributing to this stagnation included the impact of elevated inflation, which made consumers more cautious in their spending, and a normalisation effect after the easing of COVID-19 restrictions in the latter half of 2021, leading to increased social events across 2022 and 2023. As a result of a return to social drinking occasions, there was also a cannibalisation of off-trade sales by on-trade sales, further impacting overall volume sales in 2023.
Aside from financial implications, off-trade sales of alcoholic drinks were also negatively impacted by the burgeoning health and wellness trend. During the pandemic consumers started to pay more attention to their health and the impact their diet and lifestyle behaviours can have on their physical and mental wellbeing. Although the pandemic came to an end in 2023 many people continued to focus on following healthier lifestyle behaviours, which included reducing the amount of alcohol that they drink at home.
Despite France continuing to experience high inflation in 2023, the premiumisation trend persisted in alcoholic drinks. This was particularly evident in beer, with a growing interest in craft beer, ales, Anglo-Saxon beer, and non/low alcohol beer. Premiumisation was also seen in some spirits like English gin and dark rum. This focus on premium offerings was driven in part by a focus on quality over quantity as well as the search for more memorable experiences. However, the emerging niche of hard seltzers failed to gain traction due to the presence of numerous brands and a lack of consumer comprehension.
2023 key trends
There were further advancements in the no/low alcohol (NoLo) trend in France in 2023, driven by the increasing number of health-conscious consumers in France. Off-trade sales of beer with alcohol faced growing competition from an increasingly wide variety of non-alcoholic drinks in 2023, including non/low alcohol beer, which mainly focused on non/low alcohol ales rather than flavoured beer. While non-alcoholic products have found success primarily in beer, they are also making inroads into other sparkling wine, although non-alcoholic gin and non-alcoholic whiskies are yet to find a foothold in the market, possibly due to the high unit prices charged for these products.
Conversely, there has also been a notable trend towards stronger alcoholic drinks, particularly in beer such as Belgian and local ales, as well as in spirits, where premium flavoured rum and flavoured English gin have seen growth. Additionally, there has been a surge in the popularity of new flavoured products across various categories of alcoholic drinks but particularly in beer, English gin, dark rum, other sparkling wine, and cider/perry. Alongside more traditional flavours, players have also been focusing on adding more sophisticated and natural plant or fruit flavours to their ranges.
Beer remained the largest alcoholic drinks category in France in total volume terms in 2023, but it somewhat surprisingly saw a decline in total volume terms in 2023 despite maintaining growth in value terms. This was in part due to significant price increases within premium beer and adverse weather conditions. The decline was less pronounced in terms of on-trade volume sales of beer thanks to an uptick in tourism and an increase in social events in the wake of the pandemic. On-trade volume sales were also supported by the Rugby World Cup 2023 before slowing down after the French team's elimination in the quarter-finals.
Competitive landscape
Despite the slowdown in the market, the competitive landscape remained relatively stable with major players Brasseries Kronenbourg, Heineken Entreprise, and InBev retailing their lead in alcoholic drinks in total volume terms. The strong positions of these players is largely due to their dominance in beer, which is the largest alcoholic drinks category in France in total volume terms.
Wine is an important part of French culture and remained the second largest category in total volume terms in 2023, with Castel Frères continuing to lead and even increasing its total volume share in the category. This was driven by strong performances from brands like Baron de Lestac and Villa Veroni. Private label also retained an important role in wine with retailers continuing to expand their offerings to include an increasingly wide variety of options. With many consumers facing financial constraints private label became an increasingly attractive option, including in other alcoholic drinks categories such as beer and cider/perry. Ricard SA remained the top player in spirits, with popular brands like Ricard, Clan Campbell, and Absolut, although it continued to lose share as competition increased. For instance, La Martiniquaise emerged as a key competitor in whiskies and rum.
Medium-sized players, including regional craft beer companies and importers of Belgian beers and IPAs, showed some dynamism with consumers showing a growing interest in more flavourful and interesting products to standard lager. Similarly, in still grape wine, players like Bordeaux Pirates and Maison Le Star demonstrated innovation in a traditionally conservative industry which helped to attract new consumers who were keen to embrace new experiences.
Retailing developments
In 2022 and 2023, store-based modern grocery retailers, particularly hypermarkets and discounters, experienced a rebound in footfall compared to 2021. During the height of the pandemic many consumers avoided crowded spaces, but with the pandemic being declared over in early 2023 most consumers felt comfortable returning to their old shopping habits. Hypermarkets and discounters, in particular, also benefited from the attractive pricing of their alcoholic drinks which are often cheaper than in other retail channels, with these stores also carrying a broad selection of private label products.
With shoppers returning to shopping in person, e-commerce failed to pick up any further share after seeing impressive gains in 2020 and 2021 following the outbreak of COVID-19. During the height of the pandemic, many consumers turned to online shopping for convenience and safety, including for purchasing alcoholic drinks. In response, retailers expanded their online offerings and introduced services like drive-through and click-and-collect to accommodate the increased demand. However, with consumers no longer fearful of infection, most returned to traditional in-store shopping, particularly due to the higher prices often associated with online grocery services compared to hypermarkets and discounters.
On-trade vs off-trade split
In 2023, the recovery of the on-trade channel surpassed expectations, benefitting from a full year without COVID-19 related restrictions. Consumers embraced the opportunity to spend more time at restaurants, bars/cafés, and terraces, leading to increased sales of alcoholic drinks in the on-trade channel. Additionally, there was a sharp rise in inbound and domestic tourism in 2023 with this also boosting on-trade sales. Many travellers are keen to enjoy beer, wine, and other alcoholic drinks as part of their travel experience, while some even come to France for wine tours.
This resurgence in on-trade activity resulted in a natural decline in off-trade volume sales in 2023, which had experienced strong growth during the pandemic years. Modern grocery retailers responded to this drop in demand by prioritising popular products like beer, wine and spirits, while reducing shelf space for less popular items such as cider/perry. Additionally, retailers focused on stocking popular packaging formats like bag-in-box wine. Wine cellars and specialised spirit stores also continued their positive trajectory, reflecting the growing interest among consumers in receiving well-informed and expert advice when purchasing alcoholic drinks.
What next for alcoholic drinks?
Sales of alcoholic drinks are projected to stagnate in France over the forecast period in total volume terms. This projection is primarily based on changing consumer preferences towards healthier lifestyles and a growing focus on moderation when consuming alcohol. In line with this trend, the demand for non/low alcohol drinks is also expected to persist. With consumers increasingly cutting back on alcohol, especially among younger generations, this will likely have a negative impact on total volume sales of alcoholic drinks. Nonetheless, despite this more modest drinking behaviour, there still remains a trend towards excess alcohol consumption during the weekend, notably among women.
After major events such as the Rugby World Cup in 2023, the Paris Games 2024 and the UEFA European Football Championship 2024 may provide a temporary boost to sales of beer, especially through the on-trade. However, in the longer term events such as these are unlikely to significantly affect the overall trajectory of the alcoholic drinks market. There has been a long-term decline in alcohol consumption over the last 20 years with fewer people drinking on a daily or weekly basis than in the past.
One of the ongoing challenges for wine producers is the cannibalisation of sales by beer. One factor behind this is consumers switching to products with a lower alcohol content. Some consumers also find it challenging to navigate the complex labelling system associated with wine in France, which could further contribute to this shift. Moreover, unfavourable weather conditions and high inflation in 2023 are expected to impact the profitability of French winemakers, at least in the short term. Champagne may also face further challenges due to inflation and competition from cheaper other sparkling wine alternatives such as prosecco.
Inflation is also expected to impact sales of spirits, particularly imported varieties, although there remains a continued interest in Japanese whiskies among French consumers. To mitigate the effects of inflation, there may be a trend towards larger format packaging, such as bag-in-box wine, larger cans, bottles, and kegs in beer, and larger bottles in spirits, with these catering to shared consumption occasions. Prevailing economic uncertainty could also present further opportunities for private label to stake a stronger claim in alcoholic drinks in France, with locals increasingly confident in the quality that retailers offer in their selections.
MARKET BACKGROUND
Legislation
Legal purchasing age and legal drinking age
There was no change in the legal purchasing age and legal drinking age in France in 2023.
The legal purchasing age and legal drinking age in France are both set at 18 years old; however, as alcoholic drinks are usually sold in grocery retailers, specialist food shops, supermarkets and hypermarkets, young people are often able to buy them despite being under 18, as there is little enforcement of the law.
It is widely believed that drinking starts to become popular during secondary school, when teenagers embark on experimenting with cider and Champagne, before moving on to beer and pre-mixes (RTDs) in the latter years of college. It is estimated that approximately 80% of secondary school teenagers have tried alcoholic drinks by the time they are halfway through their secondary education (aged 14), while around 15% have experienced a state of drunkenness. According to the National Institute for Prevention and Health Education (INPES), the average age at which alcohol is first consumed in France is 13. The public institute’s survey also highlighted that the first experimentation with alcoholic drinks in 51% of individuals occurs even younger, at the age of 11, and tends to involve light alcoholic drinks such as cider.
From a general perspective, the drinking of alcoholic drinks amongst youngsters (aged 13-17) was in decline over the last few years of the review period, probably due to increasing average unit prices.
The Bachelot Law (2009) also changed some of the regulations concerning the consumption of alcohol in cafés, bars, and restaurants. Since then, these establishments have been prohibited from offering alcohol free of charge, or from selling alcohol, to people under 18 years. Those aged 16-17 in France are allowed to consume alcoholic drinks only if they are accompanied by their parents in on-trade outlets. In cases of non-compliance, establishments are now subject to a fine of EUR7,500, with this being double the penalty which was previously applied.
Furthermore, since 2009, open bars have also been banned. This means the prohibition of free and unlimited alcohol with a commercial purpose, or the sale of alcohol in exchange for a fixed and pre-established sum of money. Furthermore, establishments cannot offer alcoholic drinks at lower prices during specified time periods (often called “happy hours”) without including in their offering some non-alcoholic drinks at a discount. These changes in legislation also concern other types of establishments, with local mayors having the right to ban takeaway alcohol between 08.00hrs and 20.00hrs
Drink driving
There was no change in the drink driving legislation in 2023.
In September 1995, as in most European countries, France adopted the 0.5g/litre limit for the proportion of alcohol in the blood when driving (previously 0.8g/litre). From 2015, this limit became only 0.2g/litre for newer drivers – those with a licence for fewer than two or three years. Drivers found with an alcohol level of between 0.5-0.8g/litre incur a three-point penalty on their driving licence (out of 12 points which can be applied) and a fine. With an alcohol level higher than 0.8g/litre, drivers are made to pay heavier penalties, such as disqualification from driving or a six-point penalty. There have also been major government campaigns against drink driving since 2007. For example, in 2018, there was an advertisement which had a slogan "when we hold on to someone, we hold him back" and featured the consequences of party hosts letting a drunken guest take their car.
For drivers of vehicles with éthylotest antidémarrage (EAD), the limit for the proportion of alcohol in the blood when driving (previously 0.8g/litre) has been only 0.2g/litre since October 2019. EAD is an alcolock, which is a personalised breathalyser for an individual’s vehicle, which requires the driver to be breathalysed before starting the car.
Advertising
There was no change in legislation regarding the advertising of alcoholic drinks in 2023.
Since 1993, the advertising of alcoholic drinks has been strictly regulated by the Loi Évin (The Evin Law). Only eight advertising channels are allowed – the print press, radio, posters or billboards at production sites and brochures at selling points, the sending of marketing and sales catalogues, brochures or promotions by post, advertising on delivery vehicles, advertising at traditional festivals dedicated to alcoholic drinks, advertising at traditional tasting events and advertising during direct sales between producers and buyers. Advertising on television and in magazines dedicated to young readers is prohibited; however, the law does allow the advertising of alcoholic drinks on television if the alcohol content is 1.2% or less.
In all permissible advertising, the warnings “à consommer avec modération” (consume in moderation) or “l’abus d’alcool nuit gravement à la santé” (excessive consumption of alcohol can seriously damage health) must be displayed.
In October 2006, a French decree stated that all bottles of beer, wine or spirits must carry a logo or a message warning pregnant woman about the danger of alcohol to their foetus. Alcoholic drinks companies had until October 2007 to sell stocks of bottles which were not correctly labelled. The new regulation led to strong complaints from wine producers.
In 2009, as part of the Bachelot Law, the French government authorised a law dated 21 July, allowing the advertising of alcoholic drinks on one more medium – the internet – with restrictions for French youth-related or sports websites.
In late 2011, the Ministry of Health, in collaboration with INPES, launched a series of campaigns to try to reduce alcohol consumption amongst heavy drinkers in France. In June 2011, the French Court of Appeal ordered Lixir to remove a competition-related digital advertising campaign, known as “Un Ricard, une rencontre”, for non-conformity with the advertising rules in accordance with French law. The said ruling has set jurisprudence on alcohol advertising through digital channels, which had until then been subject to confusing interpretation and enforcement.
In a report submitted by Professor Michel Raynaud to the Interministerial Mission for the Fight against Drugs and Drug Addiction (MILDT) in mid-2013, a series of new proposals were made to further amend the current provisions of the Evin and Bachelot laws which pertain to the advertising of alcoholic drinks, and which will form the basis for the Raynaud Law, which was debated in 2014. Two of the most significant proposals in the report were stricter control of online advertising, especially on social networks and social media, and the advent of a pro-rata tax rate on communication expenses.
In 2016, a notable event was the clarification of the Evin Law on advertising in internet retailing. Before this, many manufacturers tended to censure their own online communications.
Smoking ban
No changes to the smoking ban were made in 2023.
On 1 January 2008, a smoking ban came into effect in all public places and all outlets in consumer foodservice and hotels. The 2007 ban on smoking in public and workplaces was extended to places of entertainment and hospitality. These locations, which include nightclubs, casinos, and discos, were given a reprieve to prepare for the ban. The ban is not absolute because smoking is tolerated on terraces, even when these areas are covered. Sealed and ventilated smoking chambers are also allowed under strict specifications.
Opening hours
With the pandemic over and all restrictions having previously been lifted opening hours returned to normal in France in 2023.
On-trade establishments
From 2022, on-trade outlets saw an improved performance compared to the first half of 2021 due to the easing of COVID-19 restrictions and the return of tourists, both domestic and international. This pattern continued into 2023 with this being the first year with no restrictions in place.
Despite the positive outlook, the recovery for many operators felt chaotic due to inflation and a shortage of staff, which became more pronounced with many employees having found alternative jobs during the pandemic.
The switch to hybrid working, with employees working on average of 1.5 days per week remotely, impacted the eat-in market and affected locations like transport hubs.
On-trade establishments saw improved performances in spring and summer 2023 thanks to favourable weather conditions in the southern part of the country and the increase in tourism. However, the winter season saw some disappointment due to concerns about purchasing power and the impact of the conflict in Ukraine and the situation in Israel.
Limited-service restaurants (LSRs) continued to gain ground due to their convenience, extended food intake times, trendy offerings, and accessible prices, especially in bakery products.
Cafés/bars, already in decline before the pandemic, are likely to continue losing outlets in rural and suburban areas. They remain important social hubs for older generations but are less attractive to younger generations who prefer urban chained outlets.
OPERATING ENVIRONMENT
Contraband/parallel trade
Although contraband/parallel trade does exist in France, its impact on the overall market is considered by trade sources to be extremely limited.
Duty free
Although sales were still far from reaching pre-pandemic levels, duty free sales saw a strong recovery in 2022-2023. Sales were strongest during the spring and summer when international airports suddenly became full of outbound and inbound tourists. According to travel experts, the number of international flights really took off thanks to the absence of major restrictions, aside from with China (which could have negatively impacted duty-free sales of cognac). Outside the airports, duty-free sales for non-European residents in premium and luxury stores also strongly recovered thanks to the return of North American tourists.
Before this, duty-free sales had plummeted in 2020 and 2021 due to the sharp decline in inbound/outbound flights. For instance, only 1% of Air France flights were maintained in April 2020. Despite the lockdown easing, things did not significantly improve from June to September 2020 due to the limited number of inbound or outbound tourists. The number of inbound/outbound passengers in French airports dropped by almost 75% in 2020, resulting in a similar drop in duty-free sales of alcoholic drinks. In 2021, many French airports closed parts of their transit areas due to the lack of passengers and many duty-free stores were closed.
Cross-border/private imports
Cross-border/private imports strongly recovered in 2022-2023 with the total reopening of borders and the rush toward sunny destinations such as Italy and Spain. When they purchase alcoholic drinks in a border country, French consumers typically favour these two destinations, although the gap between the prices of alcoholic drinks in France and Spain has declined.
During the pandemic some key borders for cross-border/private imports, including Spain and Italy, were closed. For instance, French consumers were unable to buy cheaper alcoholic drinks in Spanish ‘ventas’ (special border shops in Spain) from Mid-March to early May 2021, and from October until May 2021. Even then, they could only enter some Spanish regions (eg Navarra) but not others (eg Euskadi). All of France’s borders remained open throughout 2023.
KEY NEW PRODUCT LAUNCHES
New product launches within alcoholic drinks in 2023 were marked by original or hybrid approaches. For example, in November 2023, Egiategia launched SOCOA, which is a new submarine wine (a wine that has been aged underwater) from the French Basque Country. It is a new still red wine that was born from the cooperation between a famous oenologist and organic producer (Laurent Cassy) and Egiategia, the Basque specialist of still grape wine that is vinified under the sea (15m) in special tanks in Saint-Jean de Luz (France). SOCOA is made with a local single grape variety (Malbec) and has an original black bottle.
2023 also saw the entry of a new hybrid category with the launch of HARTZ Beer & Cider from TOPA/Eguzki. HARTZ Beer & Cider is a new hybrid concept that brings together beer and wine in 33cl glass bottles and which was priced at EUR3 per bottle (long neck) upon its launch. This domestic product was created through a collaboration between craft beer manufacturer Eguzki and cider manufacturer Topa.
Following the NoLo (no/low alcohol) trend, Pernod SA launched Suze Tonic 0° and Cinzano Spritz 0° in RTDs in 2023. Launched in June 2023, these 25cl glass bottles were initially priced at EUR1.75 per unit and were often sold in packs of three. These products are aimed at young and/or urban consumers who are fond of the bitter taste of Suze or Cinzano Spritz but who are looking to avoid alcohol.
Fireball is a Canadian whiskey liqueur that is naturally infused with cinnamon and which was launched in France in 2023. Produced by the Sazerac company (which also produces the Blanton's, Buffalo Trace, Sazerac Rye brands of bourbon/other US whiskey), this liqueur has a strength of 33% ABV and is now directly in competition with Jägermeister. Fireball is most often served ice-cold in a shot glass but can also be used to enhance a cocktail.
Outlook
New product developments in alcoholic drinks are expected to focus on greener and more sustainable production practices. This is likely to appeal especially to millennials who seek transparency and storytelling, such as about the human and natural aspects of winemaking. Examples include Pet'Nat (Petillant Naturel) and original products like Punk wine from Monoprix.
However, the niche area of organic alcoholic drinks is unlikely to see significant growth due to a slowdown in the organic market overall, coinciding with high inflation and questions over the benefits of organic farming.
There are doubts about the real potential of the new generation of non-alcoholic spirits, despite promising initial results, as these products tend to be more expensive than their counterparts.
Flavoured alcoholic drinks are likely to see success, particularly if the added ingredients are natural and original. For example, Cabochard from Maison Le Starr, the first infused still red wine with CBD, has capitalised on the growing CBD market in France, which is estimated to reach EUR2.5 billion by 2025, with an estimated one-in-ten French consumers already using CBD or CBD-based products.