Younger generations are driving low/no alcohol alternatives.
Millennials and Gen Z are drinking less alcohol and more mindfully than previous generations. They’re also much more receptive to new beverage concepts, spurring the development of new niche and hybrid categories.
There are several interconnected factors changing the way younger consumers engage with alcohol, as terms like ‘sober curious’ and ‘mindful drinking’ become part of the zeitgeist.
1 in 6 European consumers are drinking less alcohol
For many younger consumers, this trend is about making conscious and positive choices, without having to compromise on experience. There is a desire to reduce alcohol consumption and respect individual choices, almost as a response to the culture and pressure associated with drinking experienced by previous generations.
Consumers are also increasingly aware of the physical and mental impacts of alcohol and sugar consumption. This is driving demand in two areas; low/no alcoholic beverages and ‘healthier’ alternatives such as hard seltzers that contain less sugar, calories and ‘unnatural’ ingredients vs. their predecessor, the ‘alcopop’.
46% of European consumers find carbonated alcohol drinks like hard seltzers appealing
Hard seltzers: Their single-serve format appeals to consumers looking to moderate their alcohol intake, while many of these brands are also positioned as low/no sugar, low-calorie, natural and ‘clean label’ to attract their health-conscious consumers.
Low/no alcohol: In the UK, the market is expected to reach £450m by 2024 after growing by 180% last year as consumers continue seek sophisticated ‘adult’ alternatives to soft beverages[5]. Industry giants AB-InBev and Diageo are just two examples increased activity and investment in this growing segment. The message is ‘less is more’, allowing these brands to balance sales of both alcohol and non-alcoholic sales.
Tea and coffee ingredients have been central to this trend, with brands looking to create healthy/functional alcohol alternatives. Brands are operating in an increasingly competitive market and are also looking to differentiate with new hybrid products, combining the ‘health halo’ and accessibility of tea and coffee with the premium branding and occasion targeting of no-and-low alcohol.
Spanish brand Teapical's hard iced tea is made with black tea and flavoured with lemon. The refreshing drink contains just 83 calories and also contains zero sugar.
Merging hard iced tea with hard seltzer, Natz's sparkling beverage is made with fermented tea leaves. It is also free from artificial flavours and contains 96 calories per serving.
Made with sustainably sourced botanicals like saffron, bittersweet gentian, citrus blossom and vanilla, Everleaf’s Forest flavour is designed to be enjoyed with tonic.
Inspired by Spanish drink ‘Leche De Pantera’, Panther Milk's range of oat milk and spirit blended cocktails include vanilla, coffee, strawberry and mint flavours.
While any health claims in the alcohol sector remain tightly regulated, brands in the low/no alcoholic space may look to maximise the health positioning through inclusion of ingredients perceived as functional by consumers.
Consumers would therefore not only be avoiding alcohol, but also increasing consumption of ‘healthy’ or ‘functional’ ingredients such as antioxidants, CBD and l-theanine when they choose not to drink.
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