Alcohol consumption continues to decline across major markets: a trend driven by health consciousness, moderation and changing drinking cultures. It’s no short term blip or cyclical moment: but a structural reshaping of the category. Gen Z is accelerating this transition: and redefining our relationship with alcohol.
But here’s what’s important: consumers are not rejecting alcohol outright. They’re making their choices much more intentionally: prioritizing brands and products that align closely with their wellbeing goals and lifestyle aspirations.
So what drinks are they turning to: and what will shape the industry in 2026 - and in years to come?
Moderation
Drinking culture is shifting. Moderation is now a cornerstone of the beverage alcohol industry: where it’s about drinking mindfully and responsibly.
That’s opened the door for alcohol-free alternatives to shine: with alcohol-free beer, wine and spirits now launching at an unprecedented rate.
But what’s important is that it’s not about abstinence. It’s about 'drinking less, but drinking better’. Consumers want both alcoholic and non-alcoholic options: and they demand good choices in each category.
“The runway for non-alcohol beer, wine and spirits remains long, and the category is still firmly in growth mode,” says Kaleigh Theriault, beverage alcohol thought leader for NIQ.
“Penetration is still relatively low, and much of the momentum continues to come from new buyers entering the space, which signals there is still meaningful exploration and trial happening.”
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Category blurring
The rise of the moderation movement has also blurred the boundaries between alcohol drinks categories like never before.
If people aren’t drinking alcohol, then what are they drinking?
Beyond alcohol-free beers, wines and spirits, other alcohol-free drinks see an opportunity to become part of this world. That includes kombucha, kefir, and other functional drinks.
Depending on local regulations, other avenues of exploration include CBD and THC.
And hybrid products are a new area to explore. Blending beer ingredient with those from wine or cider isn’t new: but it’s something to explore to keep consumers engaged and excited by the category, notes Fredrik Svalstedt, COO and partner, Pond Design.
“For example, Italian brewers started seriously blending beer and wine, leading to the official recognition of Italian Grape Ale in 2015: a trend that has since exploded globally," he explains.
“There has also been a resurgence of beer-cider hybrids."
Premium and artisan
Premium and craft alcohol continue to shape the beverage landscape, driven by consumers seeking higher quality and authenticity.
“Drinkers who do consume alcohol are prioritizing quality over quantity, gravitating toward higher-end, more intentional products that emphasize experience and craftsmanship,” said Trisha Cancilla, Vice President of Marketing & Brand Strategy at premium US wine and spirits supplier, R.S. Lipman Company.
But premiumization is not simply about price. The concept is changing. Once ‘premium’ referred to a broad movement of consumers trading up: today it signifies a more complex shift towards products that meet consumers’ desires. That could meant trusted brands, those with a strong brand story, or those that offer experiential value.
Consumers are still spending money on alcohol: but they’re more discerning as to where each cent goes.
Clean alcohol
The clean label movement has finally reached alcohol.
The concept is commonplace in food and carbonated drinks: consumers know to favour a simple and limited ingredient list over a lengthy small print of unrecognizable additives and other ‘nasties’.
Now that’s stretching over to alcohol. Over the last few years, there’s been an increased preference for transparency over ingredients and calorie counts: that desire is now turning into a demand.
“Consumer behavior is changing. Today’s drinkers are reading labels, asking more questions and actively seeking transparency around ingredients and nutrition... just as they do in food, beauty and wellness,” said Meredith Mills Merritt, co-founder of the newly formed Clean Alcohol Collective and founder of canned cocktail brand The Original Southside.
“The alcohol category is overdue for this shift”
Sustainability
Sustainability has become a defining priority in the beverage alcohol industry as producers respond to environmental pressures, regulatory expectations and growing demand for responsibly made products.
Companies are looking at sustainable sourcing: which could mean turning to regenerative agriculture or looking at alternative ingredients.
Brewers, distillers and other alcohol producers are increasingly conscious of how energy intensive their operations are: not just from an environmental viewpoint but also to drive down costs. AI offers a tool to help improve efficiencies and economies of scale; while many producers now implement solar, wind and biomass energy systems.
