The Margarita is one of the world’s most popular cocktails, but new data shows its crown is slipping in bars.

According to NielsenIQ’s latest BeverageTrak Cocktail Report, the “dollar velocity” of Margaritas fell by 16% year-on-year in the US on-premise in the final quarter of 2025.

Dollar velocity is the average amount of money generated by a particular cocktail per venue. Its On-Premise User Survey also revealed that the number of consumers choosing the Margarita dropped by 6% between spring 2025 and spring 2026.

The switch was highest among 21 to 34-year-olds, with Margarita consumption falling by 28% in the past two years.

NIQ vice-president for the on-premise Matt Crompton said: “While the Margarita is still the country’s top cocktail, sales may have reached their peak as consumers widen their horizons and explore other categories.

“It’s leading to a diversification of the cocktail market with a new range of winners led by the Martini.”

However, sales of tequila by value in the 12 months to mid-April were only down by 2% in the on-premise. 

Loca Loka Tequila Sales Director Michael Lambiase noted on LinkedIn that tequila had a drink-list problem, not a category problem.

“Tequila is not losing the bar. The margarita is. And other drinks are taking that share — the espresso martini up 10%, the Old Fashioned up 12%, the Bellini up 31%, the mimosa up 35%,” he said.

“Which means any tequila brand still selling into accounts purely on a margarita program is anchored to the one part of its own category that is shrinking.

“The fix is not a better margarita spec. It is getting your blanco onto a line of the menu where the drink is not a margarita. A highball. A paloma. Neat in a rocks glass, listed beside the Old Fashioned that just took 12% more of the room.”

RTDs buck the trend

It’s a very different story for UK retailers, who have seen Margarita RTDs drive almost 200% sales growth over the past 12 months.

According to NIQ data, they now account for more than 11% of sales in the off-premise category.

Pernod Ricard UK Head off Off-Trade Customer Marketing Andrew Walton told The Grocer: “We’ve seen first-hand how the Margarita continues to drive engagement with the category.

“We expect the cocktail to remain a major growth engine for tequila in the years ahead.”

Have you tried a Batanga?

A few years back, Martha Stewart declared a tequila concoction called the Batanga the “cocktail of summer” and it went viral on TikTok.

But, as Esquire notes, “the Batanga is a TikTok drink that’s actually good”, while a Forbes columnist revealed earlier this year, “in Tequila, Mexico, I discovered a drink that’s better than a Margarita”.

According to legend the Batanga was created in 1961 by Don Javier Delgado Corona, the owner and bartender of La Capilla, a cantina in Tequila in Mexico. 

It features four ingredients: tequila, cola, lime juice and salt. According to Stewart the drink is a “testament to the beauty of simplicity”.

If you skip the salt rim, the drink becomes a Charro Negro.

According to its creator, this is the original recipe:

1. Use a lime wedge to coat the rim of a highball or tall glass
2. Dip the rim in salt to coat
3. Squeeze the juice of 1/2 lime into the glass (about 1/2 ounce)
4. Fill the glass with large ice cubes
5. Add 2 ounces of blanco Tequila 
6. Top with Coca-Cola to the top of the glass
7. To honor Don Javier, stir with the same knife you used to cut the lime. Don Javier claims this is the secret to its flavour.

Could the Australian summer finally see the Batanga take off Down Under?

You can also try Dan Murphy’s recipe here.