Boom time for non-alcoholic sector

Thanks to price rises and the move towards drinking products with a more expensive price tag, off-trade alcohol sales are steadily increasing year on year, but volumes remain relatively static.  

While, on the whole, British drinkers may be buying less, there are some exceptions. The volume of spirits bought, largely fuelled by gin, has increased by 3.8% compared with last year and both ready-mixed drinks (6.1%) and sparkling wines (2.4%) have seen volume sales grow.

One segment which is really taking off with shoppers buying more, not just paying more, is no/low-alcohol products. For beer, this covers products which have up to 1.2% abv, and for wines this includes anything with up to 5.5% abv. In both beer and wine, these tend to be products that started off containing alcohol and go through a de-alcoholisation process. 

In the past year, £43 million was spent on no/low-alcohol beers, an increase of 28%. Volume has increased by 21% and works out to the equivalent of more than 12.2 million pints sold in the latest year. More brands are entering this sector, with the biggest of the newcomers being Heineken 0.0% and Budweiser Prohibition. Combined, these brands have sold more than £6.5 million in the past year, which is impressive given that they only launched in 2017.  

Wine is a sizeable category within no/low-alcohol drinks and has sold just under £40 million, or 6.1 million bottles in the latest year. Sales values and volumes show a small level of growth compared with last year, but this comes without any of the big fanfare launches that we’ve seen in beer.

In spirits, we’re starting to see the launch of some small-batch drinks which have been distilled, but are non-alcoholic. While still small, they’re appearing in more and more bars, restaurants and shops, and this is clearly helping to drive their growth. As non-alcoholic spirits start to take off, we’re seeing this trend reflected in pre-mixed drinks, accompanied by a plethora of alcohol-free bars, recipe books and more.

So, what’s driving this? Our recent State of the Nation report showed that more than a quarter of shoppers say they are looking to cut down their alcohol consumption. Most are doing this by drinking less, but there’s a desire to drink lower-alcohol products to aid them in their quest. It’s not only health-conscious shoppers who are seeking to cut down their drinking, this category is gaining appeal across the board.

What does this mean for retailers? With the sugar tax increasing awareness of health concerns as well as prices, shoppers are steering away from traditional categories such as fizzy soft drinks. Shoppers are prepared to pay for a great-tasting alcohol-free alternative – the average price of a litre of no/low-alcohol beer is actually higher than the average price for a mainstream lager. The time is right to start stocking up on no and low-alcohol drinks, to meet the changing requirements of shoppers.

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