Low and no alcohol beer: ‘We do not expect category growth to abate’

By Rachel Arthur contact

- Last updated on GMT

Pic:getty/dor-riss
Pic:getty/dor-riss

Related tags: NABLAB, Beer

The low and no alcohol beer category is growing. And while a desire to reduce alcohol consumption is attracting consumers to the category, this is not the only driver.

Low and no alcohol beers are opening the beer industry up to new consumers and new occasions, according to industry experts. While once considered an inferior substitute to full-strength beers for people who could not drink alcohol, the industry has developed to offer products more comparable to their counterparts.

Alcohol consumption is decreasing, with some 37% of consumers seeking to cut back on alcohol intake. Health and wellness trends mean that drinkers are trying to cut back on alcohol and calories. 

While low/no alcohol beers appeal to consumers who are trying to cut their alcohol intake, they can also appeal to consumers from the soft drink category who are looking for an alternative to sugary or artificial drinks. Such beers can therefore tap into an opportunity for refreshment. 

Low alcohol beer is generally considered to have an ABV of 3.5% or less; while no alcohol is 0.0%-0.5%, depending on the market.

AB InBev: ‘We do not expect category growth to abate’

AB InBev now sees around 8% of its global beer volumes coming from no and low alcohol beers, working towards a goal of reaching 20% by 2025.

In non-alcoholic beers, its brands include Budweiser Prohibition (launched in 2016), Hoegaarden 0,0 (2012), Jupiler 0,0%, Castle Free (launched in South Africa in 2017), Carlton Zero (launched in August in Australia), Aguila Cero (Colombia), and Leffe Blonde 0.0% (launched this year in Belgium).

With its increasing portfolio of no and low alcohol beers, it sees an opportunity to tap into new occasions and reach new consumers. Michelob Ultra, for example, is tapping into an active generation of consumers with its premium light beer (a 3.5% ABV beer with 73 calories per 330ml bottle – around 45% less than other premium lagers). 

“We do not expect the category growth to abate,”​ said Julie Yufe, VP marketing EU, for AB InBev Europe, speaking at the Brewers of Europe Forum in Antwerp this month. “There’s been a dramatic rise in the non-alcoholic beer segment in the market, and that’s no surprise. You’ve seen us doing it, you’ve seen our competitors doing it.

“I think this is a positive story for consumers and positive story for brewers: it gives us lots of flexibility, it allows us to be in lots of places where we had previously never been.”

Is it all about millennials?

Millennials – the all-important category for any food and drink marketing – are becoming increasingly health conscious and reducing their alcohol intake.

But don’t get carried away into assuming they are the key drivers of non-alcoholic beer growth, says Rob Fink, founder of Big Drop Brewing in the UK.

Busy parents, older people who are looking after their health, and athletes are all among those who are looking to limit their alcohol intake with no or low alcohol products.

Refreshment

For Pilsner Urquell brand Birell, one of the big opportunities for non alcoholic beverages is to offer refreshment without the sugar and unhealthy connotations of soft drinks. 

The beer uses unique yeasts, allowing the product to go through the same fermentation and secondary fermentation process as classic Czech alcoholic beers.

Although the non-alcoholic beer was launched back in 1992, in 2011 it introduced a new vision: that as a non alcoholic refreshment option for adults.

Today its focus is on highlighting the natural ingredients and processes behind brewing; and the lack of artificial ingredients required in beer. Its wide portfolio now includes a botanical line (‘the fine bitterness of non-alcoholic beer and distinctive aroma imparted by the herbs used’) and even beers fortified with vitamins.

Roman Trzaskalik, marketing director, Plzensky Prazdroj (Pilsner Urquell), says that consumers used to choose non-alcoholic beers as a negative choice – because they were driving or were unable to drink for other reasons. But the brand has been working to change that perception: such as through putting the beer directly into the hands of consumers with samplings and other marketing activities.

And even in the Czech beer heartland, habits have changed and there’s an increasingly positive perception of non-alcoholic beers, he said - particularly when compared to sugary soft drinks.   

“Non-alcoholic beers have a much less unhealthy perception. I really believe that non-alcoholic beer can become the natural, non-alcoholic refreshment for adults.”

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