Insights & Trends

The Rise of the Non Alcoholic Drinks Industry

We’ve been watching the popularity of non-alcoholic drinks grow over the last 3 years, and according to new research commissioned over the last 8 months, their time has finally come.

hA Global Story

61% of consumers want better choice when it comes to non-alcoholic drinks, while 58% are drinking more no and low abv drinks than last year.

With London leading the way and Los Angeles not far behind in terms of non-alcoholic drinks growth, we commissioned IWSR and CGA to closely examine the market and provide us with first of its kind data. Here are a few key insights and findings extracted from our research.

In light of their continuous efforts towards wellness, increased curiosity and demand for greater product and flavour choices, consumers continue to lead the changes in both the hospitality and drinks industry. 

A large percentage of restaurants based in both Los Angeles and London are taking full advantage of these new trends by providing their customers with dedicated non-alcoholic cocktail menus, as well as a wide selection of sophisticated non-alcoholic spirits, aperitifs, beers and fermented drinks. Non-alcoholic Gin has proven to be particularly in demand. 

With availability growing strongly, the popularity of these alcohol-free alternatives is only set to increase. However, while innovative bars and restaurants are fully seizing this opportunity and providing their customers with a myriad of choices, there are still many who have yet to engage with the non-alcoholic trend, and adoption across the board is still a way off.

Non-alcoholic drinks seen from different perspectives

The industry perspective is that growth is expected across the world, with what is set to be a huge cultural shift happening. Wider interest is demonstrated by the growth of Seedlip amongst influential bartenders and high-end accounts. Cocktails featuring the non-alcoholic spirit have featured on the menus of some of the most prestigious bars in Hong Kong, Australia and Western Europe. 

Despite the fact that the US is typically at the forefront of market development, at this early stage, trends are being set in the UK. In fact, in April 2018, there were just four non-alcoholic spirits on the market in the UK, and by October, just 6 months later, there were 42.

From the consumers’ perspective, the growth of the non-alcoholic drinks trend isn’t about not drinking at all, but about having more choice in what they’re drinking. In the UK, 59% of people are ordering non-alcoholic drinks on nights out when they are also drinking alcohol, compared with only 29% who are drinking solely alcoholic drinks. t’s clear that consumers value the variety of flavours found in non-alcoholic drinks just as much as they value the unique experience provided by them. Having an option that tastes the same as an alcoholic beverage, or even better, is seen as a great win.

The bartenders’ take on these changes revolves around the technical challenges posed by creating non-alcoholic beverages that meet their customers’ expectations. Intensity, layering and the sensation of ‘edge’ or ‘bite’ that we find ourselves looking for in our favourite alcoholic drinks need to be created using different ingredients like chilli, citrus or bitter notes, with a particular focus on ensuring a great aroma as well as taste. Alcohol, particularly spirits, is an excellent liquid for carrying flavour at the same time as restricting the drinker to sipping.  Creating that effect in non-alcoholic drinks is much more difficult.

Distill Ventures is actively investing in brands which fulfill the need for more non-alcoholic drinks brands and is always seeking new investment opportunities in this area. The demand is currently consumer-driven and it’s about having the option in any and every occasion. Whether you’re looking to start a drinks business, or scale your existing drinks brand, we can help.

For more information on the growing non-alcoholic drinks industry and to get a little more background into our findings, you can download and read our 2017 white paper.

If you would like more information about how Distill Venture can help then read about what we look for, what we can offer and head to our FAQ section. If you still can’t find the information you’re after, or your ready to begin an application then Get in touch today! 

Download and read the full white paper on the growth of non-alcoholic drinks below.

Non Alcoholic Drinks - A Growth Story