Alcohol-free RTDs to rise by 18% in US

Non-alcoholic ready-to-drink (RTD) products in the US are predicted to grow by 18% in volume between 2022 and 2026, driven by pre-mixed cocktails.

A report by IWSR Drinks Market Analysis in December revealed the value of the no- and low-alcohol category in 2022 surpassed US$11 billion in 10 key markets.

Non-alcoholic products account for 70% of this figure, the IWSR said.

By 2026, the value of the no/low-alcohol category across 10 key markets is expected to grow by more than a third, led mainly by alcohol-free products.

Furthermore, non-alcoholic growth is being driven by abstainers and ‘substituters’, particularly among younger adult age groups.

From a small base, zero-ABV RTD products will be the ‘most rapidly expanding no-alcohol subcategory’ in the US, new findings from the IWSR revealed. Growth will be led by alcohol-free RTD cocktails.

The IWSR said the no-and-low sector in the States is ‘tapping into the momentum of RTDs and the convenience they offer’.

In addition, the IWSR cited the rise of functional drinks, much of which is restricted to being alcohol-free by regulations, which contributes to a ‘strong performance’ for no-alcohol overall.

The IWSR said the no-alcohol ‘spirits’ category is still in its infancy and is led by a number of new dedicated alcohol-free brands. The IWSR also expects to see more established spirits brands offer a zero-ABV alternative, citing examples such as Diageo’s Gordon’s 0.0% and Tanqueray 0.0%.

There has also been an emergence of celebrity-backed alcohol-free brands in the US, the IWSR noted, including Katy Perry’s De Soi apéritif range.

The report cited an uptick in alcohol-free apéritifs, dark spirits, and Tequila alternatives, as the no-and-low sector has been dominated by ‘gin’ and botanical ‘spirits’.

IWSR consumer data showed that when no-and-low consumers were asked about their interest in trying new alcohol-free categories, the most popular options were apéritif and Tequila substitutes, especially among millennials.

The IWSR said innovation in the sector will be driven by both dedicated alcohol-free producers and established brands launching line extensions.

“As brand owners strengthen their investments in the space, adjacent categories are also driving momentum, such as innovation in packaging through ABV scale multipacks, and mixer brands that are broadening their range to offer products that can be enjoyed without a spirit or spirit alternative,” the IWSR said.

In November 2021, De Kuyper released a range of zero-ABV pre-mixed cocktails.

Last month, non-alcoholic brand Caleño also debuted a range of 0% ABV canned cocktails.