Despite growing evidence that more people are being recruited into no/low-alcohol from full-strength alcohol, the main segment losing out to no-alcohol remains other non-alcoholic beverages such as soft drinks and water.
This limits the degree of cannibalisation between no/low and full-strength, and instead offers incremental growth opportunities for brand owners. It also has the potential to drive increased revenue for on-trade outlets, as consumers trade up from water, soft drinks, or not consuming at all.
According to IWSR research conducted in late 2023 across the top 10 no/low markets – Australia, Brazil, Canada, France, Germany, Japan, South Africa, Spain, the UK and the US – 44% of no/low consumers said they had switched to a no-alcohol drink from another non-alcoholic drink, such as soft drinks, water, tea or coffee. This compares to 29% who replaced a full-strength alcohol product – although this was significantly up on the 2022 figure.
“No-alcohol drinkers generally come from other non-alcoholic beverages, but also now increasingly from full-strength categories,” says Susie Goldspink, Head of No- and Low-Alcohol Insights, IWSR. “There is also an increase in the proportion of no-alcohol consumers planning to increase their no-alcohol consumption.
“Increasingly, alcohol companies see no-alcohol especially as an opportunity for growth. Moderation is an established trend, and no-alcohol products which keep customers within a category – for example, switching beer for no-alcohol beer – or within a brand portfolio – say, switching Heineken for Heineken 0.0 – offer an option to alcohol businesses to hold on to revenue and continue to build brand equity.”
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