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Leading Drinks Players Aim To Leverage Low- And No-Alcohol Trend

July 14, 2021

As American drinkers continue to crave health- and wellness-oriented products, non-alcoholic beverages mimicking familiar tipples have surged the past few years from a small base. That trend is continuing this year, with non-alcoholic wine, spirits, and beer all showing consistent growth.

Fre non-alcoholic wine from Trinchero Family Estates has been around for decades, and is the market’s biggest-seller—it depleted 253,000 9-liter cases last year, up 13.5%, according to Impact Databank. After increasing 26% last year in Nielsen channels, total de-alcoholized wine dollar sales surged 43% in the 26 weeks ending June 19.

Non-alcoholic spirits are trending even faster, and the world’s largest drinks company has been actively involved in the space. Diageo-backed Distill Ventures acquired majority control of alcohol-free spirit Seedlip two years ago, and also bought into Ritual Beverage Co. early in 2020. Ritual Zero Proof recently launched a new rum alternative, joining Ritual’s gin, whiskey, and Tequila alternatives in the brand’s portfolio. “Ritual is the true liquor replacement. It is to spirits what the Impossible burger is to meat; what Oatly is to milk,” said Marcus Sakey, founding partner of Ritual Zero Proof, in announcing the launch. “Most people who buy those products aren’t vegetarian—they just want a little balance, without sacrificing flavor.”

Ritual’s spirits retail for $27-$29 a 750-ml and Seedlip is positioned at $32, so marketers get more bang for their buck as these healthier alternatives generally sell for above-premium prices at retail. Last year, dollar sales of de-alcoholized spirits accelerated to 178% growth in Nielsen channels, and the momentum has been sustained in 2021, as they rose 124% in the 24 weeks ending June 19.

Non-alcoholic beer initially soared thirty years ago as a reaction to drunk-driving concerns, but after dollar sales rose 38% last year in IRI channels, non-alcoholic beer’s year-to-date 2021 growth through June 13 (+28%) is second only to malt-based seltzer among all beer types. Last year, Heineken 0.0 was one of the fastest-growing malt-based products—according to Impact Databank—after having made its initial American debut in 2019.

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