Where we're at

Non-alcoholic drinks hit $199M as sober curiosity reshapes the market

Between June 2023 and June 2024, the non-alcoholic beverage market gained significant momentum. Total sales soared to $199 million - an impressive 24% increase compared to the previous year.

• Non-Alcoholic Beer: Non-alcoholic beer dominates the category, accounting for 76% of total sales. Beer alone has experienced a growth rate of 23.3%. From IPAs to international favourites, there's no shortage of non-alcohol beer to suit any consumer mood.
• Non-Alcoholic Spirits: Non-alcoholic spirits have also shown growth, with sales up 67.7%. This segment is gaining traction as consumers seek sophisticated alternatives to traditional alcoholic spirits, leading to a broader range of innovative offerings. 'Dry' bars are also proliferating city scenes, influencing on-premises sales.

Who's opting for non-alcoholic?

Non-alcoholic beverages appeal to a diverse range of consumers, mostly young and middle-aged consumers who have higher household incomes (> $70,000). Health and wellness are fast becoming top priorities for these consumers, who are realizing the value in reducing their alcohol intake.

However, 75% of non-alcoholic beverage consumers also purchase alcoholic products. Brands should keep in mind that non-alcoholic beverages are not necessarily replacing alcoholic products, but consumers are integrating them into a balanced lifestyle. Consider how you can create products that appeal to this balance.

A year-round health kick

70% of on-premise consumers in each non-alcoholic beverage segment-whether beer, wine, or spirits-intend to continue with their non-alcoholic choices beyond Dry January. This suggests a lasting shift in consumer habits rather than a temporary trend. Non-alcoholic products are here to stay.

For brands to succeed, they must..

• Embrace the category: Understand the dynamics of regional markets and consumer demographics to effectively tap into the expanding non-alcoholic beverage category.
• Understand the consumer mindset: What are consumers drinking? What are the reasons they're opting for those products? Consumer behavior is at the core of this evolving industry.
• Leverage innovation: Focus on innovation to differentiate your offerings and drive growth within the non-alcoholic segment. 4.8% of the category's sales are attributed to innovation.