A famous face can sell the first bottle of anything. The second bottle is a completely different sell.
For much of the past decade, this distinction barely mattered in tequila. Americans can’t get enough agave, and celebrity names on labels look like shortcuts to the top shelf.
George Clooney and Rande Gerber demonstrated this model in 2017 when Diageo agreed to spend up to $1 billion to acquire Casamigos, the tequila brand they co-founded with Mike Meldman. Dwayne Johnson, Kevin Hart and dozens of other stars followed with their own bottles.
Then the boom stalled. U.S. sales of tequila and mezcal will decline 4.1% to $6.4 billion in 2025 after years of being the industry’s fastest-growing segment, according to the Distilled Spirits Council.
The rollback is the worst blow to a brand that sparked the celebrity craze. However, one of the younger names posted his best ever numbers.
Kendall Jenner’s 818 Tequila is on track to have its highest sales year since its launch in 2021, 818 Spirits President Lanay Jacobs said in an interview with Food Dive magazine published on October 15. My interpretation of these numbers is that the disparity has less to do with Jenner’s fame and more to do with the placement and size of the bottles.
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Sazerac gives 818 Tequila the shelf space it lacked
Sazerac, the private company behind Fireball and Buffalo Trace, announced on April 28 that it would make a minority investment in 818 and take over exclusive sales and distribution rights for the brand in the United States. Financial terms were not disclosed.
“Tequila continues to be a bright spot among spirits, driven by strong consumer interest in a growing number of occasions and price points,” Sara Saunders, chief marketing officer of Sazerac, said in a statement. “818 Tequila stands out for its cultural relevance and commercial momentum.”
Jenner called the deal “the perfect next step as we continue to accelerate our growth” in the same press release.
Jacobs said the partnership has paid off. Sales of 818 grew 73% in the four weeks ended Sept. 5, while the $25-plus tequila category fell 0.4%, according to NielsenIQ data cited by the company in the Food Dive report.
That makes 818 the fastest-growing tequila brand priced over $25, Jacobs said. She attributes this to more in-store presence from the Sazerac sales team, as well as brand events at Coachella and college tailgates.
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“As a leadership team, we are ready for the next step, which is to begin massively scaling the brand,” Jacobs told Food Dive. “Sazerac is the perfect partner to achieve this goal.”
One caveat about that 73% number: It covers four weeks, comes from companies, and starts from a much smaller base. According to Shanken News Daily, Impact Databank handles 818 cases of more than 100,000 boxes per year, while Casamigos moved approximately 1.9 million boxes in 2025, according to The Spirits Business.
Casamigos shows how quickly celebrity brands can decline
Casamigos is at the other end of the chart. According to Diageo’s annual report filed with the U.S. Securities and Exchange Commission, its U.S. net sales fell 27.7% in the fiscal year ended June 30, and losses fell 23.1%.
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Diageo’s Don Julio, another tequila, fell 19.2%. The company blamed “softening product categories, increased competition and more difficult comparisons”, adding that “both brands have lost market share”.
This squeeze extends far beyond one company:
- According to CNBC, U.S. tequila and mezcal revenue will decline 4.1% in 2025, according to the Distilled Spirits Council.
- Diageo’s U.S. tequila net sales fell 21.1% in fiscal 2026, according to its SEC filings.
- According to The Tequila Report, 87% of tequila buyers will not pay more than $55 for a shot of white tequila, and prices for tequilas over $100 fell 18% at the end of 2025.
- Brown-Forman CEO Lawson Whiting said on the company’s earnings call that prices for the entire tequila category are down 1% to 2% as drinkers consume less.
Brown-Forman (BF.B) owns Herradura and El Jimador, so Whiting believes the price war is close. As TheStreet’s Daniel Kline reported on September 25, he said during the company’s first-quarter earnings call: “If you look at the different price points for tequila, it’s hard to get above $30.”
According to Shanken News Daily, the 818 retails for $30 to $50, which puts the 818 in a difficult position. So why is it growing?
As Gen Z drinks less, why small bottles matter
I think the answer is the size of the bottle. 818 sells 750ml, 375ml and 50ml bottles, and Jacobs told Food Dive that people often don’t want to pay a premium when trying something new.
It’s the same playbook behind Jack Daniels. Whiting said on the same call that a $20 fan “would rather buy a smaller size bottle than a cheaper brand.”
The specific problem of 818 was solved on a small scale. Gallup data shows that fewer young people are drinking, with only 50% of Americans aged 18 to 34 saying they drink, down from 58% in 2023.
Those who still drink tend to prefer hard liquor. Gallup found in a July survey that liquor is now the drink of choice for 38% of young people, surpassing 36% of young people.
This makes the first bite worth fighting for. Jacobs said 66% of 818’s customers last quarter came from outside tequilas, usually vodka or whiskey.
Once tequila drinkers settle on a brand, they tend to keep it. According to Tequila Report 2026 research, 90% of tequila drinkers stick to just one bottle.
50ml bottles are a low-cost way to win loyalty before your competitors.
“Consumers are becoming more discerning about their choices and when they drink, and they’re choosing brands that resonate with them,” Jacobs told Food Dive.
Fireball makers are opening their doors to younger drinkers
The 818 is part of the larger Sazerac program. According to Food Dive, the company has acquired or invested in younger ready-to-drink brands BuzzBallz, Dirty Shirley and SipMargs, and added Svedka vodka and Dalho soju.
This bet is in line with market movement. According to SipSource data reported by The Spirits Business, the value of spirits-based ready-to-drink cocktails increased by 30% in the 12 months to March 2026, despite falling core spirit prices.
Diageo is seeing the same shift. Its U.S. ready-to-drink and cocktail sales grew 35.1% in fiscal 2026, with sales of canned and ready-to-drink Casamigos beverages growing the fastest, the company’s filings show.
Even Casamigos is seeing growth beyond its standard bottles, suggesting drinkers aren’t quitting tequila entirely but are changing how much they buy at one time.
The next test for 818 is during the holidays, when spirits are typically on sale in large bottles and gift sets. Diageo also flagged a “price repositioning” of Casamigos in its annual report, which could put the cheaper celebrity tequila next to Jenner’s.
If 818 continues to grow after that, it will talk more about Sazerac’s trucks and those little bottles than the name on the label.
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