This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
News
US to lead $4bn no-alcohol growth by 2028
The no-alcohol category is expected to grow by more than US$4 billion by 2028, driven by the US and Brazil.
According to the No- and Low-Alcohol Strategic Study 2024 from IWSR Drinks Market Analysis, the alcohol-free segment will drive the majority of low/no category growth. This segment is expected to post a compound annual growth rate (CAGR) of 7% in volume by 2028. Low-alcohol volumes are expected to remain ‘broadly static’.
For the report, IWSR looked at 10 key markets: Australia, Brazil, Canada, France, Germany, Japan, Spain, South Africa, the UK and the US.
In 2023, the no-and-low category grew by 5% in volume, IWSR revealed last year.
No-alcohol growth in the States is predicted to soar by 18% by volume (CAGR 2024-2028) and by 10% in Brazil, but the latter market will be driven by beer. Smaller markets such as Canada and Australia could be set to grow by 7.5% and 5% respectively over the same period.
IWSR noted that no-alcohol has been able to recruit more consumers into the category with an increase of 61 million buyers versus 38m for low-alcohol (2024 compared with 2022) in the 10 key markets. New recruits tend to be younger.
Factors such as taste, availability and brand have become more important in categories outside of no-alcohol beer, IWSR noted.
No-alcohol’s share of total beverage alcohol (TBA) across the 10 key markets is estimated to increase by more than 3% by 2028 and could double in the US TBA market. Brazil, Canada and the US have been highlighted by IWSR as countries with higher growth forecasts in the alcohol-free segment in the near future, while more gradual growth is expected in Spain, South Africa and Germany.
Susie Goldspink, head of no- and low-alcohol insights at IWSR, said: “As the no-alcohol category matures, consumers want more than just an absence of alcohol. They want products that deliver on taste, complexity, and overall drinking experience. This evolution is pushing the category further, prompting brands to innovate and raise the bar in terms of quality and variety.”
IWSR has singled out ready-to-drink products as having the fastest growth rate (from a low base) in low-and-no, up by 10% CAGR between 2024 and 2028. Beer is expected to post a 7% volume rise.
Availability continued to be the main reason preventing people from drinking no-and-low options more often in emerging no/low markets such as Brazil, South Africa, and the US, IWSR found. It is less of a barrier in markets like Spain, France, Japan and Germany.
Furthermore, in the more mature alcohol-free ‘spirits’ markets of UK and Spain, pricing has become more in line with full-strength offerings.
IWSR also highlighted products without added functionalities as subcategories on the rise, citing the likes of sparkling teas, hop waters, and vinegar-based switchels.
Related news
‘Spirits’ the UK’s second favourite low-and-no option