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May 10, 2024
Should Retailers Expand Their Nonalcoholic Drinks To Keep Up With the Sober Curious Trend?
In recent years, there has been an evident shift in consumer preferences toward healthier lifestyle choices and mindful consumption habits. This trend is particularly distinct with drinks, where an increasing number of people are opting for nonalcoholic options over traditional alcoholic beverages. With the rise of movements like Dry January and a growing interest in the sober curious lifestyle, the demand for nonalcoholic drinks is on the rise.
This continuing trend is backed by a survey carried out by NCSolutions in 2023 and again in 2024, which has shed light on the rising sober curious movement making its way across the United States. The findings reveal a prominent trend of Americans embracing drinking in moderation, with a significant 41% expressing the intention to reduce their alcohol consumption in 2024, marking a 7% increase compared to 2023.
According to NCSolutions, which surveyed over 1,000 Americans ages 21 and over, this shift is particularly prominent among younger generations, with Gen Z driving the trend. Sixty-one percent of Gen Z individuals voiced intentions to drink less in 2024, which is up from 40% in 2023. Millennials are also joining this movement, with almost half (49%) planning to take a step back from alcohol consumption, representing a 26% spike from the year before.
The motivations behind this trend are varied and reflect the changing values across society. Gen Zers expressed a mix of reasons for cutting back on their alcohol consumption in 2024, including financial savings, improved physical and mental health, lifestyle changes, and weight management.
Additionally, there seems to be a transition in America’s drinking culture overall. While drinking has historically been deeply rooted in American society, sentiments are changing. In 2023, 93% of respondents felt that “drinking alcohol is a big part of America’s culture,” according to NCSolutions. Now, the perception is changing, with only 84% still feeling this way, indicating a shift in societal norms surrounding alcohol consumption.
The concept of mindful drinking is also gaining prominence, with 34% of survey respondents referring to themselves as mindful drinkers. Mindful drinking is a conscious approach to alcohol consumption, which takes into consideration factors such as frequency, duration, and quantity of drinks consumed.
This shift toward mindful drinking habits and the curiosity around nonalcoholic beverage alternatives shows the evolution of consumer preferences in the retail market. As consumers prioritize health and wellness, they are increasingly seeking out options that align with their lifestyle choices.
Retailers and restaurants have an opportunity to cater to this growing market by expanding their range of nonalcoholic drinks. By adjusting to evolving consumer tastes and expanding their product offerings, businesses can tap into this trend and appeal to a broader customer base.
According to a Business Insider report from March, the CEO of the renowned hotel and social club chain Soho House revealed a significant surge in nonalcoholic drink sales during this year’s Dry January. The spike came despite members spending slightly less on drinks and food in the three months leading up to January compared to the previous year.
On an earnings call, Andrew Carnie, the chief executive officer of Soho House, said, “What we also saw in January was a much bigger spike in nonalcoholic beverage consumption, much more than we’ve ever seen before.”
Soho House is well-known for its classic cocktails, but it also serves a wide variety of nonalcoholic drinks in its 44 club locations, which range from London to Bangkok.
In February, data company CivicScience surveyed 1,500 U.S.-based adults over the age of 21 regarding their drinking habits and found that a quarter of those surveyed said they participated in Dry January this year.
According to ISWR, a beverage research company, the nonalcoholic drinks industry is anticipated to increase to nearly 4% of the overall alcohol market by 2027, which is expected to reach $545.8 billion this year.
In its survey, NCSolutions found that mocktails are expected to dominate the beverage space in 2024 as an emerging top option among Americans for nonalcoholic drinks. There is also a growing interest in THC and CBD-infused beverages. People are drawn to these alcohol-free options mainly out of curiosity regarding taste, due to an appreciation of their visual appeal, or because they perceive them as a healthier alternative to alcohol.
In line with NCSolution’s 2023 findings, which highlighted Gen Z’s preference for purpose-driven advertising, 34% of Gen Z respondents expressed a higher motivation to try new drink products marketed to align with the sober curious lifestyle in 2024. Celebrities and influencers also play a key role in driving Gen Z’s interest in nonalcoholic drinks. The survey shows that almost one in four (24%) Gen Zers have experimented with nonalcoholic beverages due to endorsements from celebrities or influencers such as Blake Lively, Bella Hadid, and Dwayne “The Rock” Johnson.
When it comes to identifying new nonalcoholic beverage options, social media paves the way for Gen Z as the most effective advertising channel, with almost half (45%) saying it is their main source of information. Internet searches and streaming TV follow, with 16% and 15% of respondents, respectively.
Discussion Questions
How can retailers and restaurants adapt their offerings to meet the increasing demand for nonalcoholic beverages and mindful consumption?
In what ways can companies leverage social media and targeted advertising to appeal to consumers interested in nonalcoholic and health-focused beverages?
What role can partnerships with influencers, celebrities, and wellness advocates play in promoting nonalcoholic beverages to target demographics like Gen Z and millennials?
Poll
Loading …BrainTrust
Gary Sankary
Retail Industry Strategy, Esri
Christine Russo
Principal, Retail Creative and Consulting Agency
Albert Thompson
Director, Brand Strategy (President), Transient Identiti
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The preference for non-alcoholic beverages has been growing for quite some time. And the number of options has expanded. What’s interesting is that most people, especially in social settings, don’t want plain non-alcoholic drinks: they want options that feel special and interesting, which is why there is such an explosion of brands, like Kin Euphorics, offering these more sophisticated choices. Target, as usual, is on top of this trend with its partnership with online non-alcoholic beverages operator Sèchey. There are also some great independent players, like Club Soda in the UK which has an online offer and a tasting room in London where they hold events. One note, however, is that the growth of this trend doesn’t mean the alcohol category is going anywhere: it’s still massive.
There has been growth in this category for a while. The additions of adaptogens and other functional beverage attributes are helping facilitate the growth of this category. I think it’s a great idea to have no hangover, etc when drinking these beverages. Where were they in my college days?
There were non-alcoholic drinks, however, don’t think playing “beer pong” with soda would have gone over very well in our youth LOL
Here is my suggested playbook:
First, put more NA Beer on the menu. A lot more–most places, if they offer it at all, give you “Heineken Zero” and the list ends there. There are many good labels out there (Athletic and Untitled Art come immediately to mind) so put them on the offering list.
Second, the whole “Mocktail” trend is okay, but all of these drinks are loaded with sugar, at least the ones I have seen. Which in and of itself is not horrible, HOWEVER these sugary drinks are right up there with a Coke. All you are doing is trading one health issue for another one (sugar is horrible for you, and a known cancer feeder to boot). Keep these drinks on the menu, of course (I am not trying to be a complete killjoy here) however start adding non/low alcohol options like Gin or Bourbon on the rocks.
Third, put other items on the menu like more sparkling water options. Liquid Death for example, in the can. Gives you the ability to “Pose” without giving the No Alcohol thing immediately away because of the design of the can.
I am not sure you need to target any group, nor do I think some “alcohol is bad for you” campaign is needed-people are making these decisions without celebrity endorsements, etc. The issue I see with any kind of campaign is the confusion about the risks and benefits of alcohol. One week someone is telling us not to drink at all, the next week comes a study saying red wine (paid for by France of course) is pretty good for you, and the following week comes a stream of ads telling you how attractive and intelligent you and your buddies are (not to mention how much fun you are having) when you have a drink in your hand. So-maybe a campaign around how much better you feel the morning after, etc.
In summary, I think there is a lot of revenue potential here for establishments that present these drinks “thoughtfully”
I want to add something that I thought of this weekend: Maybe, just maybe, Restaurants are not really invested in truly realizing this revenue stream. Why? Because when one drinks, you lose inhibitions, not just with what you do or do not say, but with how much you eat and drink. My guess is total $ spent at a table with alcohol vs. one with no alcohol is generally higher. Food for thought, no pun intended.
When Daniel Craig did the Heineken Zero ad for James Bond, that made the non-alcoholic category mainstream in restaurants. After than many restaurants and bars have at least have Heineken Zero. That did more than any PSA could have done
Almost two and a half aisles are already devoted to non-alcohol beverage product distribution, not including monster-sized displays of every brand of me-too flavored water imaginable at the front. You know, mango-orange, grape-raspberry, cherry-lime, and so on!
In my CPG business, I must receive an average of three calls, or emails, or web site inquiries each month from yet another entrepreneur who has an “innovative new bottled water product.” It’s a variety of six flavors of spring water, with vitamins, minerals, antioxidants, electrolytes, energy, probiotics, you name it, it’s in there!
There are several brands of just plain bottled water available at supermarkets, in all shapes and sizes, at different price points, in different dispensing varieties, and with different designs. There are brands that offer 24 bottles for $19.99, or one bottle for $5.99.
Increasingly, there are more varieties of soda, regular, non-caffeine, diet, and zero sugar, and they come in cans, bottles, in a variety of sizes, and in case packs. Some sodas aren’t even sodas. There are dozens of brands of bottled teas, juices, coffee drinks, sports drinks, and more.
So, should retail carry more non-alcohol options? I think they are maxed out. But wait, here’s another email from another small company, with an extremely high-quality water from Retailers have already expanded distribution of non-alcohol beverages to the point where nearly two and a half aisles are housing all the shelf inventory, not even including front-end monster sized displays of every brand of me-too flavored water imaginable. You know, mango-orange, grape-raspberry, cherry-lime, and all the others!
In my CPG business, I must receive an average of three calls, or emails, or web site inquiries each month from yet another entrepreneur who has an “innovative new bottled water product.” It’s a variety of six flavors of spring water, with vitamins, minerals, antioxidants, electrolytes, energy, probiotics, you name it, it’s in there!
And don’t forget that supermarkets carry as many as twenty brands of just plain bottled water, in all shapes and sizes, price points, dispensing varieties, designs, and this one is mountain water, this one is spring water, and this one is bath water. The consumer can find brands that offer 24 bottles for $19.99, or one bottle as high as $5.99.
Of course, there are more and more varieties of soda, regular, non-caffeine, diet, zero sugar, and each are in cans, and bottles, in a variety of sizes, and case packs. And some soda’s aren’t soda at all. There are dozens of brands of various types of bottled teas, juices, bottled coffee products, sports drinks, and more.
So, should retail carry more non-alcohol options? I think they are maxed out. But wait, here comes another email from another small business, with a very premium class of water from the Arashiyama Bamboo forest in Japan! But the business is based in Toronto! – Db
IMHO, this story seemed overly based on a single survey, but trend – or fad – my question would be the same: what is needed to “adapt”? (aren’t there sufficient options available now?) One of the attributes of alcoholic beverages has always been that they are quite profitable; presumably this will be something retailers will want to keep, but it might be a challenge to get people to pay $20 for a glass of fruit juice/soft drinks, simply because they paid that for its (alcoholic) predecessor.
That’s a really good point about cost, Craig.
Haven’t non-alcoholic options been available since before the invention of alcohol? What about mocktails, virgin drinks, Shirley Temples, Arnold Palmers, etc.? They’ve been around forever as zero-proof, non-alcoholic options.
This is a gimmicky fad that has made the “uncool choice” very cool by giving it a catchy, trendy name and removing the peer pressure that forces alcohol down our throats involuntarily. All establishments should embrace this trend because it’s a very low risk strategy and the ingredients to make non-alcoholic options are surprisingly, already available – have always been.
To Craig’s point, alcohol is a profit driver so maybe retailers/restaurants could use the revolutionary idea of moderation to introduce Half Moon May or Just Enough June during which they reduce the amount of alcohol in all cocktails by half? Win-Win?
The good news is that recreational drug use is up so keep an eye out for Forever 420 (April) and Fly High In July. Finally, I think we can extend this strategy to keep government regulation out of the BNPL mess by launching No Debt December and Financial Freedom February.
Drink (and borrow) responsibly!
As demand grows for alcohol-free beverages, retailers and restaurants can adapt their assortments and menus. Giving customers a range of drink choices can make them feel welcome and comfortable.
Brands can reach consumers interested in alcohol-free drinks by leveraging social media campaigns for Dry January and Sober October. They can also target sober-curious communities, pregnant women and new moms, and health and fitness communities.
While Millennials and Gen Zs have embraced non-alcoholic drinks, Boomers and Gen Xs may also consider switching, especially if they take medications that do not mix with alcohol.
In general, retailers should give the customer what they want but use AI and personalization to identify what they want before investing and then add a curatorial slant on purchases to be differentiated.
A data scientist once told me that retail buyers would be irrelevant in a few years because AI will do a much better job predicting trends than humans can. When AI can tell me what handbag Taylor Swift will carry to the Grammys or what sweats the paparazzi snap a photo of Beyonce in, I’ll agree. Until then, the best part of retail is betting on trends. Nowhere is that more fun than in the food business.
The non-booze trend has been picking up steam for a while. Will it have staying power? Maybe, probably. But, like everything, it’s a trend. Gluten-free is a good example of a trend with some staying power; paleo diets, not so much.
As a retailer, it’s vital to be aware of these trends and ready to give your customers what they’re interested in. Also, be aware of when it’s over and react accordingly.
I did chuckle at a piece I heard on NPR over the weekend that some bartenders are getting a bit uptight about kids ordering their non-alcohol creations. “They’re not for kids,” supposedly. As a retired parent, I would agree, but only because I’d balk at a $19.00 glass of juice.
Let’s face it folks. The medical community has made it very clear that alcohol, even a few drinks a week is bad for your heath. Most of us are not going to give up alcohol completely anytime soon, however, mixing it up with non-alcohol, or low alcohol drinks makes sense, There are so many really good choices now that it makes it pretty easy to do so. Phony-Negroni’s, Hella’s Bitters & Soda Bittersweet Spritz and so many others, which have all the botanicals so the taste is great makes it even easier to enjoy a non-alcohol drink. Sometimes, a drop of tequila or gin or vodka makes it even better. So yes, retailers would be missing an opportunity if they did not ride this trend as I believe it is here to stay.
Non alcoholic drinks and customer is an incremental business for retailers or restaurants, it does take up shelf space which is why it is important to balance it. It is a fine line for restaurants since alcoholic drinks generates more revenue per head, but you can offer incremental business to the non alcohol drinking diner that would otherwise stick with sparkling water. In retail shelves, let the stock movement decide whether it is good for your store.
Having a non-alcoholic beer or mocktail on the menu is nice. Taking it to another level is having an entire piece of your beverage selection focused on non-alcoholic choices. These choices can range from products that have the same taste as the alcoholic beverage a customer is familiar with to fruit drinks (smoothies, juices, etc.) to health drinks. Keep in mind these choices are options, not replacements. It’s best to survey your customers. Find out what they want and deliver!
While “Dry January” is merely a mock for personal reconciliations in drinking, mocktails are here to stay. Whether this movement is tethered to “clean eating” or the rise in accessibility to CBD, the consumer has spoken – especially the younger generations who understand the perils of alcohol. Mocktails have securely taken a seat at the table not only as an expansion of the product pipeline, but an expansion of conscious thought around all the things we consume. Restaurants ask about food allergies, while offering gluten free options. Offering mocktails is a rather basic extension for human wants. Neil Saunders is right, “but keep it interesting!”