New research from CGA by NIQ has revealed that tequila is enjoying near-double-digit sales growth in Canada’s On Premise, powered by young adult drinkers and its popularity in cocktails.

CGA’s exclusive On Premise Measurement (OPM) solution shows tequila sales by value have soared by 9.8% in the last 12 months, while volumes have grown 2.7%—slightly ahead of the US, where volumes have dipped 1.8% in the same period. Rate of sale has been the primary driver of growth, as more Tequila drinkers experiment with tequila to broaden their horizons and trade up their choices.

The powerful sales data is complemented by CGA’s Fall 2023 On Premise User Survey (OPUS), which helps suppliers and brand owners uncover the demographics and preferences of tequila drinkers. It reveals the largest single cohort of drinkers in bars and restaurants is Legal Drinking Age (LDA) adults under 34, who over-index for tequila consumption by nine percentage points, and who have grown in number by three percentage points since 2020.  

Tequila’s stellar growth has also been driven by cocktails. Nearly a third (30%) of consumers cite it as their favourite spirit base in cocktails—up by six percentage points in just four years, the largest uplift of any spirit.  

OPUS highlights tequila drinkers’ interest in experimenting with drinks choices and exploring new combinations of flavors. While half (52%) say they favor classic cocktails like a Margarita, this is seven percentage points below the average cocktail drinker. By contrast, tequila drinkers over-index by three percentage points for interest in experiential and creative offerings that provide twists on classic cocktails, and by six percentage points for signature cocktails that are unique to their venues. They are also 2.8 percentage points more likely to pay extra for a better-quality brand of tequila than they were 12 months ago.

CGA’s breakdown of tequila sales by location indicates that it enjoys its highest share of the spirits market in Ontario, where it attracts 17.9% of volumes, after year-on-year growth of 7.3%. British Columbia also outperforms in tequila share against the national average.

Mitch Stefani, CGA by NIQ’s client solutions director – Americas, said: “Tequila’s growth in the last year outpaces that of other categories, showing to be a formidable offering through several types of serves to cater to consumers experimental behavior. The category is increasingly growing its competitive landscape making it important for suppliers to educate operators on their brands and effective ways to position the category on menus.”