How Gen Z are influencing low-and-no
While the idea that Gen Z has turned its back on alcohol is misplaced, according to research, many drinkers across the board are mindful of what they consume. What does this mean for low-and-no brands?
*This feature was originally published in the October 2025 issue of The Spirits Business magazine.
You might think the younger generation has a lot to answer for when it comes to alcohol. It’s generally assumed Gen Z are largely responsible for the rise of the no- and low-alcohol category, and simultaneously are to blame for the decline in global alcohol consumption. While it’s true Gen Z (those born between 1997-2012) are the biggest advocates of moderation, it’s time to bust the myth they are irreversibly averse to alcohol.
According to IWSR’s No/Low Alcohol Strategic Study, published in December 2024, 75% of Gen Z consumers said they had moderated their alcohol intake over the past six months. This is compared with 74% of Millennials (1981-1996), 66% of Gen X (1965-1980), and 55% of Boomers (1946-1964). As for sales, Millennials are still buying the most no/low products, with a 35% share of spend, followed by Boomers at 25%, Gen X at 24% and Gen Z at 18%. An IWSR Bevtrac survey released in June 2025 showed Gen Z’s alcohol consumption was now “broadly in line” with other generations, suggesting many are pushing back against the moderation trend and re-engaging with alcohol.
Across 15 markets in the Bevtrac survey, the proportion of legal-drinking-age Gen Z adults who reported drinking alcohol in the past six months rose from 66% in April 2023 to 73% in March 2025. This increase is more pronounced in the US, where it rose from 46% to 70%. In the UK, it rose from 66% to 76%, and in Australia from 61% to 83%. The overall rate of 73% is still lower than the participation rate of all adults (78%), but the report concluded Gen Z behaviour is not significantly different from that of other generations. “With every year that passes, more Gen Z drinkers are entering the workforce, and those already in the workforce are typically earning more,” said Richard Halstead, IWSR’s chief operating officer of consumer insights, said at the time. “I think we should expect that, as their incomes rise, they will drink more often – just as Millennials did before them.”
Circumstantial factors
This year, a Rabobank report dismissed the idea Gen Z’s moderation is due to being more health-conscious. It stated they simply have less money and a third are still underage – circumstantial factors, and not indicative of a life-long decision to shun booze. During a conference with investors in September, Diageo’s interim CEO, Nik Jhangiani, echoed this sentiment calling “bullshit” on the assumption Gen Z are health conscious and therefore alcohol averse. Kam Insight’s 2025 Low & No Drinking Differently report adds further weight, stating the no/low category is “not all about Gen Z” anymore, with 76% of UK adults across age groups seeking to “actively moderate” their alcohol intake. Alcohol is losing its “default status”, it argued, acknowledging a cultural shift.
“We all continue to be more educated on the health impact of food and drink, and alcohol is just part of that,” believes Gary Read, CEO of non-alcoholic drinks producer Bolle. “Maybe Gen Z have different priorities in their lives than prior generations had at the same age. This has helped fuel the NA [non-alcoholic] drinks category, but I feel it may be a little over-hyped. The whole ‘Gen-Z doesn’t drink’ has never rung true, and does not reflect our experience. It is much more subtle than that.”
Against this backdrop, assuming Gen Z will carry the no/low torch into the future seems arbitrary. So, where does the future lie?
Unsurprisingly, the reasons for moderating alcohol intake are universal, not generational, driven by health, availability, and economics. Younger drinkers hold great potential, but there’s also a huge opportunity to tap into older generations. “If I was advising the industry right now, I would be saying that younger people will find you because they have a need to go out, to stay in control, and to be on trend,” says Halstead. “But you’ve got this massive chunk of older people who are also moderating their consumption, and by that I mean anyone over the age of 40, who have the same essential needs, which is to not drink too much and to look after themselves. They want drinks that taste like grown-up drinks but don’t necessarily contain alcohol.”
Re-engagement
This older cohort might have decided in their youth that zero-alcohol products tasted terrible – most of them did – and mentally swore off the category. Now, the quality of no/low options is catching up with demand, offering an opportunity to re-engage with this generation. “Gen Z and younger demographics are really important, but this is a cultural shift and change in drinking habits that is running through every generation,” says drinks expert Tom Surgey. “Older generations have a really crucial role to play in this movement too.” On 8 October Surgey will launch Parched – a new consumer and trade show bringing together hundreds of no/low producers to taste more than 100 products. It’s happening now because for the first time there are enough “extraordinary” non-alcoholic options to showcase.
Overall, the no/low category is expected to grow by US$4 billion in value by 2028, at a compound annual growth rate (CAGR) of 4%, according to IWSR. But distribution and visibility must improve if the category is to thrive. “We are at a really interesting catalytic point whereby there isn’t enough sales data for operators to make a ‘safe’ decision to list a non-alcoholic draught beer or put on a non-alcoholic wine or similar by-the-glass, but unless they do, their consumers won’t have the opportunity to rise to the opportunity and purchase,” explains Surgey. “We need trade to be brave and make non-alc options more easily available, and the market will rise to it. Consumers have a clear mandate too – if you want better non-alcoholic options, buy them.”
Then there’s the thorny issue of price. Many consider alcohol-free options unreasonably expensive, especially given they don’t incur duty. Convincing consumers they’re worth the price tag, especially in the off-trade, remains a challenge. “The problem with the price of alcohol-free is that we overvalue alcohol,” says Laura Willoughby, co-founder of mindful drinking movement Club Soda. “It will always be difficult because we will pay far more for alcohol than it costs to produce.”
Category descriptors
In the UK, a regulatory decision on category descriptors is also pending. Currently ‘alcohol-free’ is defined as anything up to 0.05% ABV. If passed, all drinks with an ABV of 0.5% and below could be labelled ‘alcohol-free’, as in Europe, which would better support the growth of the industry, says Willoughby. “The industry needs to work together and stand up,” she says. “It’s our best opportunity to get the government to recognise what actually is a UK success story because this market started here. Most of the global innovators are based here. It’s something we should be really proud of.”
Retaining the momentum and collaboration the category has built, not just internally but with the wider alcoholic drinks industry, is also key. The industry has understood that this needs to be part of the mix, and is actually positive for venues as well as a society as a whole,” adds Willoughby. “I don’t think we’ll ever go back to a point where it’s OK to go and drink alcohol in your lunch hour at work, for example, but pubs still want to bring people in at that time. You can still have a pie and a pint, but it can be an alcohol-free pint.”
Alcoholic drinks brands need not fear for their future, adds Surgey, but he is mindful of the need to be conscious of changing consumer behaviours, and how and when people are choosing to consume alcohol. “Premiumisation and focusing on genuinely exciting, high-quality alcoholic drinks is key. The majority of consumers will continue to drink alcohol but will seek out quality. Crucially, there is room for both. What is so exciting about the growth of no and low is the advent of a genuinely worthwhile alternative option to alcoholic drinks.”
As for emerging trends, functional spirits are gaining traction. Three Spirit’s range of alcohol-free botanical elixirs are made with active ingredients that give health benefits, for example. “Functional is a fast-moving category,” says Willoughby. “People like the idea of having added benefits to their drink. Alcohol is the main mood-enhancing ingredient we use in this country, so putting something like Ashwagandha or Lion’s Mane or Maca into a drink is very persuasive.”
There’s also a growing movement to promote mid-strength drinks, adds Willoughby. “That’s where spirits come into their own, because people are already looking for mid-strength cocktails. They know a Negroni is really strong, but they want to stay out for three or four cocktails, so they will spend the same money, have the same number of drinks, but less alcohol overall.”
Other brands are experimenting with completely new flavours and distillation techniques. Sylva, a non-alcoholic distillery and maturation laboratory in Essex, opened last year. Founded by Ben Branson (also behind Seedlip), its aim is to create luxury dark ‘spirits’ with an ABV of less than 0.5%, extracting flavour from wood and cereals.
So, is moderation a generational blip? Given the cross-generational support, that seems unlikely. Moderation isn’t a fad. It’s a cultural shift reshaping drinking habits at a fundamental level, significantly widening the market for no/low drinks. That doesn’t mean global alcohol consumption won’t bounce back – but there will be more choice.
As Halstead has previously stated, moderation is set to be a long-term factor, but alcohol consumption is “not in a tailspin”. “Much of the recent decline is cyclical, not structural,” he argues, “and is definitely not the ‘fault’ of Gen Z.”
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