No and low alcohol trends – is it a thing?

There is an abundance of conversations being generated regarding non-alcoholic or low-alcohol beverage products. These beverages are inspired by alcoholic beverages such as wine, beer and cocktails, however, contain very little or no alcohol. There is a growing consumer preference for these sort of beverages, but just how big is the movement?

How big is the low and non alcoholic segment in Australia?

2021 IWSR Drinks Market Analysis found that no / low alcohol volume in Australia increased by 2.9% in 2020, whilst the regular alcohol market experienced a decline of 1.4%. It is predicted that the no and low alcohol volume in Australia will grow by 16% from 2020-2024. However, the non-alcoholic wine sector was only worth $4.5 million last year. Whilst notable, it is not overwhelming compared to the wine segment which is worth around $7 billion annually. Whilst the segment is undoubtedly growing, one must be mindful to put the percentage growth into monetary terms to understand the actual scale of the market segment.

Who is driving the low alc / no alc trend?

43% of consumers in the non-alcoholic sector are 18-34 year olds. The movement toward non and low-alcoholic beverages is being referred to as ‘sober curious’ and ‘mindful drinking’. These consumers elect to consume these beverages for a variety of reasons. Some consumers are health conscious who are electing to take a more holistic approach to their drinking habits. They embody the ‘mindful drinking’ tag line. Situational non-drinkers elect not to consume alcohol temporarily, or depending on the current circumstances such as being pregnant or breastfeeding or being the designated driver for the night. There are also permanent non-drinkers, who don’t drink on any occasion. This may be for religious reasons or a personal lifestyle choice.

How has the market adapted?

Dan Murphy’s recently opened their first ever solely non-alcoholic bar in Melbourne – intuitively named ‘Zero%’. The bar serves an assortment of non-alc beer, wine, cider and cocktails. Sans Drinks was one of Australia first non-alcoholic stores in Sydney that has continued to thrive with the change in consumer preferences. A number of new labels have been established that focus on appealing to consumers in this segment – such as plus and minus. Additionally, many companies have expanded the offering of certain brands by incorporating non-alcoholic sku’s under the same house of brands.

Non-alcoholic beverages including beer, wine, cider, spirits and cocktails is definitely a growing trend. Whilst only a small segment of the market, the demand for these products is undoubtedly growing.