It's big news for anyone keeping an eye on the no-alcohol drinks market (and two fingers up to those that pooh-pooh it), as the category is forecasted to grow by a whopping $4 billion by 2028.
While still only a drop in the total beverage alcohol ocean, we're no longer talking about small change when it comes to the impact of low/no on those economies that embrace its potential.
No over low
In 2023, the no-and-low category was worth over US$13 billion (IWSR 2023) and grew by 5% in volume across 10 key markets: Australia, Brazil, Canada, France, Germany, Japan, Spain, South Africa, the UK, and the US. Reemphasising the global reach of the sector.
A recent report from IWSR (2024) Drinks Market Analysis shows that in those regions, alcohol-free options are stealing the spotlight over low-alc options and are expected to grow by 7% annually by 2028, while low-alcohol drinks are holding steady with little change.
By 2028, no-alcohol's share of the total beverage alcohol (TBA) market across these 10 countries is expected to grow by more than 3%, and it could even double in the US.
No-alcohol options are also pulling in more new drinkers, with 61 million people joining the category since 2022, compared to 38 million for low-alcohol drinks.
As is often cited, it seems younger drinkers looking for great-tasting alternatives are showing up for these drinks more frequently than older generations. But it's not just about cutting out the booze. People want drinks that taste amazing, are easy to find, and come from brands they can trust (large or small).
Susie Goldspink, head of no- and low-alcohol insights at IWSR, sums it up,
"As the no-alcohol category matures, consumers want more than just an absence of alcohol. They want products that deliver on taste, complexity, and overall drinking experience. This evolution is pushing the category further, prompting brands to innovate and raise the bar in terms of quality and variety."
Leading the charge
When it comes to numbers, the US is expected to see a massive 18% growth (CAGR 2024-2028) in alcohol-free drinks by volume. Brazil is also climbing with 10% growth, which is mainly driven by beer.
Not to be left behind, Canadian and Australian markets are also predicted to grow by 7.5% and 5%, respectively.
All this brings no-alc's share of the global alcohol market to 3%.
Despite the global enthusiasm, availability is still a hurdle, especially in emerging markets like Brazil, South Africa, and the US. However, it is less of an issue in more established markets like Spain, France, Japan, and Germany.
Pricing is also becoming more competitive, particularly in mature alcohol-free spirits markets like here (the UK) and Spain, where prices are starting to match their full-strength companions.
What's next?
Ready-to-drink (RTD) products are making a lot of the noise in this space, with a forecasted 10% annual growth rate through 2028. And beer is, of course, still holding firm, with a projected 7% rise in volume.
Meanwhile, products that blend functionality and creativity are also making waves. Think sparkling teas, hop waters, and vinegar-based switchels—offering refreshing alternatives for adventurous palates.
Innovation is ramping up all round, and it's not just about mimicking traditional alcoholic drinks. There's no denying that functional beverages have made a massive impact on the market, and it's clear they will continue to do so.
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