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Demeter & Co. Targets Low- And No-Alcohol Trend With First Brand, CleanCo

October 5, 2021

Last month Shanken News Daily exclusively reported the formation of a new drinks company, Demeter & Co., led by industry veterans Jim Clerkin and Jeff Menashe. Now, Demeter is introducing its first brand, CleanCo, a collection of non-alcoholic spirits that has already been established as a fast-growing franchise in its home market of the U.K.

Founded by entrepreneur Spencer Matthews in late 2019, CleanCo has gotten off to a rapid start and is projected to sell 50,000 9-liter cases across the U.K. and U.S. this calendar year. “The brand was born out of a desire to reframe my own relationship with alcohol,” Matthews said in an interview with SND. “I used to be a city trader, and always seemed to have a reason to drink socially. When my son was born, I decided to give total abstinence a try, and I discovered that there were really no direct, credible replacements or alternatives to spirits out there. Many of the large brewers have zero-alcohol variants that outsell their alcoholic variants in certain markets, and I wondered why there couldn’t also be alcohol-free equivalents of spirits with the same level of success.”

CleanCo’s range includes Clean T (Tequila), Clean G (Gin), Clean R (Dark Rum), and Clean V Spiced Apple (Flavored Vodka) expressions retailing at $30 a 700-ml. bottle. “In the U.K., CleanCo leads with Clean G (the gin alternative), whereas in the U.S. we will lead with Clean T, our take on an agave forward Tequila Blanco,” said Clerkin, Demeter & Co.’s CEO. “In this way, we’re complementing the significant growth of Tequila in the U.S., while showcasing CleanCo in one of the country’s fastest growing cocktails, the Paloma.”

For the U.S. launch, Demeter is taking a “digital-first” marketing approach, with a strategy to place equal focus on the wholesale and direct-to-consumer channels. On the wholesale side, Southern Glazer’s will roll out CleanCo across seven markets this month, including key states like California, Florida, and Texas. “The consumer is telling us that the opportunity in no- and low-alcohol is now,” commented Southern Glazer’s CEO Wayne Chaplin.

Matthews agrees. “Only a tiny percentage of people have even heard of the non-alcoholic spirits sector, so there’s so much room for growth,” he says, opining that it could be another 18 months before many of the spirits industry’s heavyweights mount a major push in the category with some of their more famous brands. Indeed, while Diageo is active in the segment with the Seedlip and Ritual labels, total dollar sales of dealcoholized spirits in NielsenIQ-measured channels in the U.S. registered only $2.3 million in the year-to-date through September 5, albeit on a 101% increase year-on-year. “We’ve done incredibly well in the U.K.,” said Matthews, “and now is the right time to strike and take the big gamble in the U.S.”

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