How to sell alcohol-free drinks all year round

Dry January, the month-long pledge to go alcohol free, has become well-established event in the food and drink calendar each year. With three out four UK adults proactively moderating their alcohol intake (according to a KAM data report in 2023), it’s no surprise that low and no alcohol beverages have taken off in recent years.

While Dry January might be a good time to try new products in your shop or run a marketing campaign focused on moderation, customers are increasingly looking for no and low alcohol beer, mocktail spirits and other alcohol-free drinks year-round. Becky Kean, founder of Nirvana Brewery, recognises that Dry January will always be important for retailers and alcohol-free drinks producers, “but the fact is that low/no beers are becoming very much part of the fabric of people’s drinking habits, whether at home or out and about,” she says. “As such, the year-round potential is greater than ever before.”

The state of alcohol-free drinking in the UK

The UK’s market for no and low alcohol drinks is maturing, but despite this, the IWSR saw continued growth in the sector in 2023, and the group says the trend is expected to continue, with growth forecast at an 8% volume growth rate over 2023-2027. 

The main driver of the trend in the UK is alcohol-free beer, but low-alcohol drinks are expected to make headway over the coming years too, in part due to changes in alcohol tax for products below 3.5% ABV. 

Who is drinking low and no alcohol beverages? Millennials were the highest percentage of buyers and tended to drink these products more frequently than other groups, IWSR says.

Attracting new customers to low and no alcohol drinks

In a bid to appeal to consumers looking to moderate their alcohol intake, more and more drinks producers are creating low or no alcohol versions. NICE wine, for example, has created a Session wine to offer moderating consumers more choice. “Moderation of alcohol isn’t new, and it isn’t niche,” says founder Lucy Busk. “It’s also not just a Gen Z phenomenon. We can see from the data that it’s happening across all age groups. Data is also showing that it isn’t just about Dry January, and consumers are looking to moderate all year round.”

Want to boost sales in your shop? Lucy suggests allowing customers to try your products. “Sales in the fine food channel could be bolstered all year round by offering in-store samplings and educational point of sale,” she says. High-quality low-alcohol wine is a relatively new proposition compared with beer and spirits. According to KAM data, the sector is worth £146m and grew 17% in the past year – yet for many it still has a bad reputation. Critics often say alcohol-free wine tastes like juice. Producers like NICE are looking to fill the gap with options that still taste like wine but have a lower ABV.

When it comes to no and low alcohol beers, Becky believes retailers can benefit from offering a wide selection to keep things interesting, including limited edition and seasonal brews. Nirvana Brewery, which was set up in 2016 as the first dedicated low/no brewery in the UK, brews seasonal specials such as a London Porter and an Elderflower lager, and its core range includes a Helles lager, three pale ales, an IPA and a stout.

3 trends in low and no alcohol drinks

1. Low/no mixing

Like Lucy, Becky believes the trend towards moderation over complete abstinence is driving the no and low alcohol movement. “The strong trend we’re seeing is low/no ‘mixing’ – beer drinkers varying their rounds both at home and in pubs between full-strength and low/no beers, effectively reducing their overall alcohol intake, as opposed to completely stopping it,” Becky says.

According to research from IWSR, 79% of consumers of no and low products also drink full-strength alcohol. These consumers are classified as ‘substitutors who choose no/low products when avoiding alcohol on certain occasions’.

2. Functional alcohol-free drinks

Other producers are leaning into the mental health problems that alcohol can cause with functional benefits. “Abstaining from alcohol is certainly one way to improve your health and avoid the dreaded ‘hangxiety’, but it’s not sustainable if what you’re drinking doesn’t taste good or help you relax and unwind,” says Olivia Ferdi of TRIP, a brand of CBD-oil-infused drinks.

“That’s why TRIP was created as a drink that tastes as good as it makes you feel, and helps you to relax into your best self,” she said. Indeed, IWSR’s research pointed to functional and mood-altering ingredients as a continued driver of new product development for their benefits of reducing stress and having calming effects.

3. Agave drinks

It also appears that alcohol-free trends are following broader drinks industry trends. For example, while agave spirits like tequila gain traction in the UK, no-alcohol agave alternatives are beginning to spark interest among consumers, especially in the US, according to IWSR’s research.

What is considered ‘alcohol-free’?

The definition of ‘alcohol-free’ drinks could be about to change in the UK. In September, the government began a consultation on encouraging more people to choose no and low-alcohol drinks by allowing drinks containing 0.5% ABV to be labelled alcohol free, up from the current threshold of 0.05%. This move would be in line with countries like the USA, New Zealand, Germany and Australia, and, the government believes, would make no and low alcohol drinks more popular and easier to buy, helping shift the market to healthier alternatives.

“No and low-alcohol drinks are getting more and more popular, and we are looking to further support their growth,” says public health minister Neil O’Brien. Many other countries around the world already allow more freedom over this. Liberalising labelling guidelines could also help people make more informed choices about the drinks they buy.”

Becky thinks the legislation could be a boon to low and no alcohol producers. “If the consultation sees the minimum threshold raised from 0.05% to 0.5% ABV, it would definitely further boost the appeal of such beers, given the likely increased ‘mouthfeel’.”