Big brewers are struggling. The start of 2025 was defined by volume declines for the world’s biggest brewers. With cost-of-living challenges and inflation, consumers are less likely to go out or spend money on beer.
Alcohol-free beers, in contrast, grew strongly. Can these reverse brewers’ beer fortunes?
Meeting consumer trends
Alcohol-free beer is trending. Consumers are shifting their focus towards health, wellness and – most importantly – moderation.
Younger consumers are driving the surge, with Gen Z and millennials showing strongest affinity for the category, although they are not alone. Alcohol-free brews give consumers the chance to enjoy the taste of beer, and the social rituals that go with it, but without the alcohol. And it’s not just a temporary trend: data shows that drinking culture has fundamentally changed.
Over the last decade, big beer has brought credibility to the alcohol-free category and helped push it into the mainstream.
Go back five years and one of the biggest challenges for the category was visibility. But big beer’s marketing muscle has given the category the boost it needs: take Corona Cero’s sponsorship of the Winter Olympics this year; Heineken 0.0’s F1 tie-up; or Michelob Ultra Zero at the Super Bowl.
And that’s bought with it a lot of credibility for the category. For decades, the category was plagued by perceptions of inferiority. But, in lending their name to the alcohol-free category, long respected brands such as Stella Artois, Budweiser and Guinness have helped change perceptions.
In fact, today 61% of consumers say they’d be happy to choose a non-alcoholic version of their favourite beer.
And big beer is only getting started.
The world’s largest brewer, AB InBev, saw non-alcohol revenue shoot up 34% last year. And that’s part of a longer term trend: net revenue from the category has more than doubled since 2021.
The brewer expects alcohol-free to grow at around 3x that over the overall beer category in the coming years (2025-2029).
Turning challenges into opportunities
It’s part of an important shift in focus for brewers, because they need to address a fundamental challenge to their business: falling beer consumption.
Alcohol-free beer is a good bet for big beer. Margins are attractive (around 20% higher than the average beer, according to AB InBev). Products aren’t subject to alcohol tax or stricter regulations.
Alcohol-free beer also lines up nicely with responsible drinking initiatives.
But perhaps most importantly, it opens up beer to a new range of consumers and occasions.
But this shift hasn’t happened overnight. A wave of innovation five or so years ago transformed the alcohol-free shelf (Guinness 0.0 launched in 2020, Stella Artois 0.0 in 2021, Corona Cero in 2022), and set up the foundations for the category today.
The rollout of alcohol-free heavyweights has followed a careful process: firstly, developing the technology; secondly in launching carefully thought out alcohol-free products for mega-brands; and finally by pushing the marketing muscle behind them," explained Michel Doukeris, CEO of AB InBev, in the company’s FY2025 earnings call earlier this year.
“We invested a lot in the technology, making sure we have superior products, and this investment was done in 2020, 2021, 2022. And there were many breakthroughs there: we have great tasting beer without alcohol.
“Then we started to roll this out on our winning brands: so we have great brands across the globe.
“And we’ve decided to invest and walk the talk. So just think about the Olympic Games: a mega platform that we have globally, that we sponsor with both Corona Cero and Michelob Ultra Zero”.
And the secret ingredient to the winning playbook is big beer’s experience in brand building, distribution and marketing.
“We got great products; we lit up the brands and innovation; and invested behind them,” continued Doukeris. “And when we do that all together with our execution – which is our superior execution – we can gain share quickly as we are gaining. We can expand categories, reach more consumers, and get the growth that we are getting with zero.”
To put it another way, it’s about meeting an opportunity: “Consumers are there; we are there for them; and we are gaining share in an accelerated way in this segment.”
Alcohol-free brews, therefore, represent an attractive opportunity to brewers: and one they’re embracing.
Growth trajectory
But despite the growth potential, the reality is that Big Beer’s business remains in Big Beer. Behind all the hype – and the very real potential of consumer demands and attractive margins - alcohol-free brews remain a fraction of total volumes and sales.
A few years ago, big brewers were setting ambitious targets for up to 20% of sales to come from alcohol-free beer. That still appears to be a long way off: that figure is, in reality, in the region of 2% to 5% today.
“The no-alcohol beer category is growing at double digits, but from a very low base,” explains Carlos A. Munoz, from Scope. “There is room for some modest incremental growth, but that won’t be large enough to materially increased consolidated volumes or offset the decline in traditional beer categories.”
Most brewers don’t disclose how big a part of their total portfolio alcohol-free brews take. One of the few to do so is Carlsberg: which says alcohol-free beers like Carlsberg 0.0 accounts for around 3% of its portfolio. Its play into Beyond Beer – most notably with the acquisition of Britvic – is far, far bigger.
Alcohol-free brews remain a key area of innovation and opportunity for brewers, and one that’s growing fast. But the market shift from Big Beer to Big Non-Alc Beer will still take some time.
