TLDR: Everyone is hopping on the spirits bandwagon
For a long time, the spirits market has been dominated by a handful of spirits-focused international giants (Diageo, Pernod, etc.)
Their lock-up of valuable IP and giant distribution footprints make it hard for anyone to compete, and they are notoriously capable of *defending* that dominance.
^Diageo welcoming independent brands to your local liquor store
But that's starting to change...
And it's a very big deal.
But who has the resources (and the cojones) to go to war with the kingpins?
The Italians...
Ok, well not the Italians (although quite a few Italians). I mean the wine industry, which has much in common with our favorite Italian gangsters.
Several of the largest wine companies in the US are still owned and operated by the families that started them generations ago.
^Google Ernest Gallo and tell me he didn't look like a friendlier Godfather.
As is the case for most family businesses, they tend to be on the conservative side. Sticking to the strategies that have allowed them to thrive for decades.
But in the last several years, many of them have been aggressively entering the spirits market and building their own portfolios.
Even changing their names to reflect this new identity:
So why change their business model after a hundred years of sticking to their turf?
Let's look at a graph of the alcohol market share change in the US:
The line for wine looks flat but it represents an average 2% annual decline over the last 10 years.
2% is no big deal right? It's still a multi-hundred-billion dollar industry.
But what if you want to pass the business on to your kids like it was given to you?
A 2% annual decline is a big deal when measured over generations.
Diversifying at least some of their portfolio into the category that takes up the majority of wallet share makes a lot of sense.
They also have plenty of natural synergies:
- Relationships (and huge volume) with the distributors
- Big sales forces with on-premise and retail relationships
- Robust knowledge of complex alcohol regulations
Gallo has been the most aggressive and they are now the third largest spirits supplier in the US.
Now you are probably thinking: "Bubba, the beer line in that market share graph was the wild one. What about them?"
You smart cookie.
Beer is coming too, but the entire beer and wine industry is child's play to the other 500lb gorilla that could change everything.
More to come... | 
