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Low- And No-Alcohol Category Gets A Boost From Consumer Wellness Trends

October 11, 2021

American drinkers continue to crave what they perceive as health- and wellness-oriented products. Non-alcoholic wines continue to thrive, soaring 45.5% in dollar terms in the 37 weeks ending September 18 in NielsenIQ channels. 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. More recently, Pacific Highway Wines launched Giesen 0% Sauvignon Blanc, and expects to sell nearly 15,000 cases this year—to be followed by other non-alcoholic Giesen offerings: Rosé, Red Blend and Pinot Gris.

Non-alcoholic spirits are trending even faster, and the major industry players have embraced the growing demand for alcohol-free cocktails. The world’s largest drinks company has been actively involved in the space as Diageo-backed Distill Ventures acquired majority control of alcohol-free spirit Seedlip two years ago, and also bought into Ritual Beverage Co. early last year. Ritual Zero Proof offers gin, whiskey, Tequila, and rum alternatives in the brand’s non-alcohol portfolio, and retails for $27-$29 a 750-ml. bottle. Seedlip is positioned even higher at $32. Most recently, Demeter & Co., led by Jim Clerkin and Jeff Menashe, announced its entry into the segment with the U.S. launch of CleanCo, whose gin, vodka, rum, and Tequila alternatives ($30 a 700-ml.) are projected to sell 50,000 cases across the U.K. and U.S. this year.

Last year, dollar sales of de-alcoholized spirits accelerated to 178% growth in NielsenIQ channels, and the momentum has been sustained in 2021, as they rose 101% in the 35 weeks ending September 4, to a retail value of $2.27 million. And though they represent less than one-tenth of 1% share of the total spirits industry—according to Impact Databank—alcohol-free alternatives will continue to comprise a fast-growing percentage of the overall market into the foreseeable future.

On the beer side, besides seltzers, only one other malt-based beverage segment is showing double-digit growth—non-alcoholic beer—with gains of 21.3% in volume terms and 25.9% by dollar value for the year-to-date period ending September 5, according to IRI. Leading the way is Heineken 0.0, which is the largest-selling non-alcoholic brew in the U.S.—according to Impact Databank—followed by Anheuser-Busch InBev’s Budweiser Zero. Heineken 0.0 earned an Impact “Hot Brand” award after more than doubling to just under 1.8 million cases last year.—Juan Banaag

De-Alcoholized Drinks – Off-Premise Trends
(millions of dollars)
Type 2020 Retail Value Percent Change
vs 2019
2021 YTD
Retail Value
YTD
Percent Change
Beer1 $188.2 37.7% $163.4 25.9%
Wine2 $32.0 25.3% $28.5 45.5%
Spirits3 $1.8 178.1% $2.3 100.9%
Total $222.0 36.3% $194.2 29.0%
1 Year-to-date ending 9/5/21 in IRI channels
2 37 weeks ending 9/18/21 in NielsenIQ channels
3 35 weeks ending 9/4/21 in NielsenIQ channels
Source: IRI, NielsenIQ and IMPACT DATABANK © 2021
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