February 26, 2022
Trends in Off-Premise for No- and Low-Alcohol Beverages
The increase in demand for no- and low- beverages has created trends in off-premise channels.
According to Nielsen data, last year, off-premise sales of no- and low-alcoholic beverages were $3.1 billion, up from $291 million the year before. And, IWSR predicts that the no- and low-alcohol market will grow by up to 30% by 2024. With the continued growth in this segment, the beverage industry is seeing several key trends in off-premise channels that are bringing more and more consumers into the category.
These off-premise channels include typical retailers like grocery stores, liquor stores, and convenience stores, however, new channels are emerging with a focus on the non-alcoholic segment including ‘dry’ liquor stores (bottle shops), physical pop-up shops, and online websites dedicated to non-alcoholic beverages.
One trend that has allowed the no- and low- market to expand is the diverse number of high-quality products that are available. With increasing consumer demands, both mainstream and craft brands have developed a variety of new beer, wine, cider and spirit products to meet those needs. Off-premise retailers must also meet the needs of their customers to offer inclusive products to all types of consumers. Online retailers have also been expanding the number of products they offer. Over the last two years, one non-alcoholic online store called The Open Road has increased its product offerings from less than ten to 230 products from 75 different brands.
On top of alcohol-free wines, beers, ciders, and spirits, new categories like alcohol-free, functional beverages have become more prevalent, and retailers are keen to take advantage of this growing segment, which introduces ingredients like CBD and adaptogens. New flavor profiles and new product packaging are also keeping product offerings fresh. With major alcohol brands seeing the potential, they are making investments that increase the overall quality of products across the category. Investments in innovative techniques and equipment like BevZero Equipment’s GoLo technology allow for the highest quality end product, and as consumer demand for these products increases, so will continued variance in off-premise representation.
Growth of ‘Dry’ Channels
While off-premise retailers are continuing to increase their acceptance of the no- and low- category, major cities across the U.S. have seen a proliferation of businesses that offer only no and low-alcohol options. In New York, where liquor stores are not able to sell non-alcoholic beverages due to strict rules, dry bottle shops like Minus Moonshine, Boisson, and Spirited Away have flourished. These shops offer alcohol-free wines, beers, and spirits that offer chic packaging and unique marketing that speaks to this growing consumer. In Los Angeles, Soft Spirits offers a wide array of artisanal non-alcoholic products designed to speak to the health-focused consumer, as well as those seeking to moderate their alcohol consumption. These no- and low- products are also being served by no- and low-specific distributors, such as 86 Spirits, out of North Carolina.
In addition, direct-to-consumer sales have given brands a new way to get in front of their target audience, bolstered by the regulatory simplicity of selling and shipping an alcohol-free spirit rather than a traditional alcoholic beverage. With the online sales, retailers also get more chances to educate on no- and low-alcohol products and more education translates into more consumer attraction and sales.
Joining the Movement
With no- and low-alcohol products having a big moment, we’ll continue to see off-premise channels follow the trends. The time is now for brands to stake their claim in the category. With major suppliers bolstering their portfolios with no- and low-brands, and consumer demand at record highs, BevZero offers a full range of services and equipment that align with market conditions and cater to the specific needs of the clients. This includes end-to-end services including product development and supply services.
Contact BevZero and partner with a global innovative leader of beverage services and solutions.