A new report by IWSR suggests that Sub-Saharan Africa represents “one of the most compelling long-term growth opportunities” in drinks. But how can producers overcome “structural volatility” and a market crowded with local products? db dives into the findings.
Sub-Saharan Africa, which includes markets such as South Africa, Nigeria and Kenya, represents a sizable opportunity for drinks producers, according to a new IWSR report. However, a number of key and persistent issues, described as “not temporary headwinds”, means that entering these markets is not for the faint-hearted.
“Africa is often cited as beverage alcohol’s next frontier – and the demographics justify the attention,” said Russell Menezes, research director for Africa and the Middle East, in the report. “The population is young, fast-growing and rapidly urbanising.
“Aspirational consumption is a recurring motif – alcohol brands serve as symbols of social mobility for emerging middle classes, even during periods of economic strain. South African consumers demonstrably trade up selectively for special occasions, and the same is true for other African countries, such as Nigeria, Tanzania, Ghana and Ethiopia.”
More and more global producers are mapping out strategies for how to enter the region. Indeed, as Benjamin Jack, director of South African wine producer Bruce Jack Wines, reported for the drinks business:“Those who delay risk arriving too late”.
But succeeding in Sub-Saharan Africa is rarely as simple as putting boots on the ground
Local dominance
Across Sub-Saharan Africa, locally-produced products dominate, accounting for 97% of beer volumes in 2025 as well as 80% of spirits, 87% of RTDs, 59% of wine and 71% of cider
Therefore, persuading consumers to switch allegiances and pay more for imported brands is a significant hurdle. Yes, the emerging middle classes might be trading up, but they are the exception to the rule.
“Downtrading – rather than premiumisation – is the dominant consumer behaviour, particularly in recent years, leading people to migrate from spirits to beer, from imports to local brands, and from commercial products to artisanal or informal alternatives,” the report said.
“Smaller, cheaper pack formats are enjoying explosive growth for affordability reasons.”
RTDS and spirits
Against this challenging backdrop, where should drinks producers focus their attention?
According to IWSR, the biggest growth opportunity lies in RTDS (with volume sales +14% in South Africa, +8% in Nigeria and +14% in Kenya in 2025) “as consumers look to manage their budgets”.
After RTDs comes spirits, but it’s important to note that different African markets are buying different spirits for different reasons.
In South Africa, for example, Cognac and Armagnac are on the ascent with volume sales +18% in 2025, and a predicted CAGR of +5% to 2035. The French spirits appeal to “the image-conscious middle and upper classes” who are attracted to the “high-status reputation” of Cognac and Armagnac, the report explained, adding that both are “expected to sustain strong growth trajectory, underpinned by deeper premiumisation and an increasingly competitive brand landscape.”
There is South-African interest, too, in Tequila, said the report, “as consumers become more discerning and knowledgeable about the category”, with volume sales up +7% in 2025.
It’s a different story in Nigeria, where spirits growth was dominated last year by gin, bitters, cream liqueurs and whisky, particularly Indian whisky, which “caters to Indian expats and aspirational Nigerian consumers”. Meanwhile, blended Scotch is on the decline as “consumers seek stronger value propositions”.
Looking to Kenya, Irish whiskey volumes grew by +35% last year, while Tequila shot up by a staggering +65%. These have a predicted CAGR of +3% and +6% respectively to 2035.
Millennial honeypot
Additionally, revealed the report, millennials are the consumer demographic to target in African markets.
“Millennials remain the crucial age cohort, representing the largest share of drinkers, and exhibiting the highest participation and heaviest drinking occasions,” it said.
Comparatively, Gen Z poses “a long-term recruitment challenge” given that this age group is “substantially less engaged with alcohol than older groups.”
In fact, it is millennials that are snapping up RTDs and alcopops in their droves as they seek “convenient, sweeter alternatives to beer.”
Therefore, it could be argued that launching a ready-to-drink flavoured cocktail, marketed to 30-45 year olds (millennials), might be the safest bet for a drinks company hoping to crack into multiple African markets at once right now. Though db would caveat that by adding that comprehensive research into locally-produced RTDs would need to be undertaken to identify gaps in product offerings, as well as to establish a competitive price point.
*IWSR’s Sub-Saharan Africa data covers Angola, Benin, Botswana, Cameroon, Congo, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Ethiopia, Gabon, Ghana, Ivory Coast, Kenya, Mauritius, Mozambique, Namibia, Nigeria, Reunion, Senegal, Seychelles, South Africa, Tanzania, Togo, Uganda, Zambia.
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