NON-ALCOHOLIC DRINKS

For those in the liquor retail business, it might seem counterintuitive to focus marketing and retailing efforts on occasions dedicated to actively avoiding alcohol.

Nevertheless, according to Chris Allan, Brand Director of XXXX, alcohol abstinence months like that of Dry July, Ocsober and FebFast are now too large, and too lucrative, for retailers to ignore. In fact, XXXX Zero, the brand’s first non-alcoholic option in nearly 150 years of brewing, was released in the run up to Dry July this year.

“It presents an exciting incremental purchase opportunity for retailers, to have consumers purchase XXXX for more occasions through their week,” Allan explained.

“Some of the biggest barriers to drinking non-alcoholic beer is not understanding its relevance or a misconception that it won’t taste as good as mid strength or full strength beer.

“Occasions like Dry July provide consumers with a great platform to see just how great non-alcoholic beers like XXXX Zero are, and whether it’s something they’d like to include in their fridge ongoing, for those occasions where a zero alcohol product is more suited.”

There are now several periods of the year when drinkers are encouraged to moderate their intake of alcohol or abstain from drinking entirely. In many cases, these occasions have been developed by charities as a fundraising drive via pledges and sponsorships.

Non-alcoholic months have moved from localised, small-scale efforts to a worldwide phenomenon, with Australia right at the cutting edge of the trend, as Big Drop’s Darren West illustrates.

“On a global level, Dry July has spawned many variations. In the UK, it didn’t really start until 2013, when the charity Alcohol Concern got behind it, but in the form of Dry January,” West says.

“Tournée Minérale in Belgium has been going since 2017. They chose February as the month to do it… Same with Canada and the Czech Republic.”

The scope of these occasions has now gone beyond their charitable origins, helping give rise to permanent changes in consumer habits.

As West said: “Over the past few years, consumers have been choosing to moderate their alcohol intake for their own reasons and it has certainly become more of a bigger lifestyle choice elevating the growth of nolow products as a category.”

According to Rebecca Yeates, Director of Trade Marketing & Category for CUB, these patterns are being repeated in Australia.

“What we are seeing is an increase in consumers choosing to moderate, and that Dry July boosts non-alcoholic sales during the cooler months, which typically underindex for this offer,” Yeates says.

“This seems to kick-start the upward trajectory leading into the warmer and typically more social or celebratory time of year where non-alcoholic continues to play a key role.”

Cameron MacFarlane, Marketing Director at Tribe Breweries, also said these non-alcoholic occasions are helping people think differently about the no alcohol market.

“It has become trendy to not drink, and many people set challenges with themselves, as well as their friends and family, to abstain from alcohol,” he said.

“While some of these initiatives and months have been around for over a decade, Australia still has a big drinking culture and being ‘sober curious’ still has a lot of stigma attached to it.”

Brown Family Wine Group’s (BFWG) Group Marketing Manager, Emma Brown, believes there is change coming, and said: “The social stigma of taking time off alcohol has certainly dropped off.

“[No alcohol months] are making it more socially respectable to ‘have a day off ’ or ‘have just one.’”

The beer segment may be a leader of the-alcoholic drinks category, however, non-alcoholic occasions have shone a light upon the category’s wine sector.

Angela Flynn, Marketing Manager for Giesen Group, identified alcohol abstinence months as one of the motivating factors driving Giesen’sinvestment in non-alcoholic production technology.

“The Dry July Trust is doing a greatjob in promoting awareness for theDry July campaign in both Australiaand NZ and every year they see growthin numbers of people participating inthe challenge,” Flynn said.

“In fact, it was this movement that drove the innovation around our 0% range.”

Another wine brand that is operating and innovating in this space is Fourth Wave Wines, which has produced a range of zero per cent ABV wines in cans, including soon to be released non-alcoholic Moscato and Bubbly Rosé SKUs. Ross Marshall, Managing Director of Fourth Wave Wines, also cited non-alcoholic month occasions as crucial to the emergence of the nonalcoholic category.

“Feb Fast, Dry July and Sober October have been important for the zero alcohol category as it has put the focus squarely on what is happening in this space for a condensed period of time,” Marshall said.

“During these occasions we generally see a trend of new products and innovations as they have a stronger chance of visibility.”

BFWG is another wine group to recently enter the category, releasing a 0.5 per cent ABV Prosecco under the Brown Brothers label.

Brown explained how the group hopes to market this new expression over the coming months, saying: “We will be supporting this product and future releases to this category in key socialising periods, including the key ‘dry months’.”

The non-alcoholic market of Australia is attracting the attention of overseas wine brands too, with French brand Barton and Guestier introducing zero per cent products over the last two years.

Guillaume Bladocha, Export Manager for Asia-Pacific, said: “We have very strong ambitions for this year’s Dry July.

“After two years of having the wine in the market, I believe that July 2022 will be the strongest one ever in terms of depletions on our zero per cent alcohol wines.”

The brands that spoke to National Liquor News were in agreement – non-alcoholic months are a key gateway to the category for many consumers.

Paul Bowker, Founder and Managing Director of Brick Lane Brewing, which is seeing great success with its ultra-low alcohol beer Sidewinder, said: “The key for the no alcohol months this year is to encourage consumers to try a number of options within the space.”

MacFarlane agrees, and said: “The most important thing retailers can do is be aware of the space and trial the options available, rather than remain ignorant to the category.

“Taste, trial, find your favourites and then display them easily and proudly for customers to find and experience, particularly during sober-curious months.”

Bladocha also highlighted this, noting: “This is a great opportunity to test your products, see which ones of these will be become your top seller for the full financial year coming up.”

It is clear that the non-alcoholic month occasion has played a crucial role in expanding public interest and acceptance of both alcohol abstinence and of nonalcoholic products themselves.

But who exactly is purchasing these products, and participating in these occasions? Most brands National Liquor News spoke to agreed that it’s a trend led largely by young adults.

Heaps Normal’s Andy Miller gave some important background for retailers, and said: “While it’s clear the uptake of nonalcoholic options is happening across people of all ages and backgrounds, it’s being led by younger drinkers.

“The number of people in their 20s abstaining from alcohol increased from 8.9 per cent in 2001 to 22 per cent in 2019. Australians aged 18-44 are twice as likely to consume zero and low-strength alcohol compared with those aged over 45.”

Lyre’s Chief Marketing Officer, Paul Gloster, also concurs, saying that although all ages are involved, “Millennials and Gen Zs seem to be most engaged in mindful drinking occasions.”

Yet, retailers should also note that there is a broad audience for non-alcoholic drinks, that crosses generational divides. This wide appeal is something that Bowker is particularly keen to highlight.

“What we are seeing is the non-alcoholic products cut across a wide set of demographics and include non-drinkers and regular drinkers across all age groups,” he said.

“The real surprise has been the very strong take-up by those in their 20s and 30s who are highly social but also very conscious of wellbeing.”

This conversation is a timely one, considering the recent proliferation of NPDs in the non-alcoholic sector.

One such example is Lyre’s, which this year has added several new non-alcoholic SKUs to its portfolio, replicating the flavours and experiences of drinks such as pink gin, agave spirits, and Scotch whisky.

Gloster said it’s important to keep an eye out for new products as brands continue innovating, as “having quality alcohol-free options will keep customers in store and coming back. People will go where quality options are sold – they still want to be social even when not drinking.”

Reviewing your non-alcoholic range is also timely right now considering the next ‘dry’ month occasion approaches next month – Dry July.

One tip for this upcoming occasion comes from Jaz Wearin, Co-founder of Modus Brewing, which produces non-alcoholic beer brand, Nort.

“Have a highly visible non-alcoholic section in the lead-up to July, so customers know they are being supported through the month and have a clear path to purchase when they are ready to stock-up for going dry in July,” Wearin said.

Meanwhile, Brown suggested retailers should lean into the joy and exploration that this purchasing journey brings.

“Make it fun. There’s a huge opportunity for retailers to inject fun into this category, particularly during the key awareness months,” she said.

For West, it’s a good idea to also recognise the importance of the charitable message behind the month.

“Dry July is certainly a very noble cause, and it was started by three mates who wanted to take a month off the booze. Getting friends to sponsor them, their target was to raise $3,000 for the local hospital waiting room, they raised $250,000,” West said.

“Retail could look to set up their own teams of staff, friends and customers to form a Dry July team. Partner with no-alcohol companies and brands to help with sponsorship and goodies and support packs along the way. This really is a fantastic opportunity to first and foremost get behind a wonderful initiative through entering your own team or supporting your customers on their journey.”

Although abstinence occasions place a heightened focus on non-alcoholic offerings, Miller says its important to also keep the bigger, year-round, picture in mind too.

“Think about how you can not only cater to those who are abstaining for July, but also to those who are cutting back or experimenting with smaller adjustments to their lifestyle,” he said.

Similarly, Brown said: “It’s important for retailers to realise this is not a ‘turn on and off ’ category fad, it’s here to stay.

“It’s important for them to consider having a high-quality range throughout the year.”

MacFarlane suggests retailers should redouble their efforts in making sure non-alcoholic products are immediately visible to consumers seeking them out, with prominence taking absolute priority.

“Ultimately, I think retailers need to be loud and proud of their nonalcoholic options,” he said.

“A big issue we’ve noticed with many retailers is that they struggle to know where to place non-alcoholic options in their shops.”

Finally, Gloster explains that high-quality and wide ranges are the determining factors that will increase the number of customers and sales of alcoholic products.

“As more and more alcohol-free months get added to the agenda and mindful drinking increases in spades across the board, look toward the opportunity rather than seeing it as a challenge,” he said.

“No alcohol months can certainly be an opportunity for retailers. With so many amazing alcohol-free options in the market now, there’s no reason sales have to stagnate during no alcohol months.”

Kaddy Marketplace has the data and it all points one way - we’re entering a no or low alcohol (NOLO) beer boom. Here’s the lowdown on what’s happening.

In the November edition of National Liquor News last year, Kaddy co-founder Rich Coombes made a prediction that we should “not sleep on non-alc this summer”, calling the category an “unstoppable juggernaut” and noting how some of the best-selling products on the Kaddy Marketplace were NOLO.

Now, over six months later, that juggernaut is riding a tidal wave. Over the past six months, the top-selling product on Kaddy Marketplace was Heaps Normal’s Non-Alcoholic beer, with the category growing at an extraordinary 170 per cent YOY, overtaking all other segments on Kaddy.

What’s really important for retailers to note is that not only are the volumes increasing, but the SKU count is exploding too. There are now 125 low alcohol (0.5 per cent or less ABV) beers on Kaddy Marketplace, with new releases added regularly, like Brick Lane Brewing Co.’s Sidewinder XPA, and Capital Brewing Co’s Alc-Less Pacific Ale which was released for pre-sale in mid-May.

That range explosion has been driven by more adventurous options too, with top brewers venturing beyond lagers and session ales into the whole beer kaleidoscope. For example, we’ve seen

brews like Big Drop’s award-winning, non-alc Galactic Milk Stout, Sobah’s Finger Lime Cerveza and Brewdog’s Nanny State Hoppy Ale prove wildly popular. Big Drop is also currently the most awarded brewery in the UK.

According to IWSR research out earlier this year, the volume of NOLO beverages sold is now growing globally at six per cent CAGR and will be at eight per cent CAGR over the next four years, meaning that this is just the start of the boom.

NOLO beer is here to stay - and now is the time to be dropping in on this wave. Check out Kaddy Marketplace, your home of NOLO, today.

kaddy.com.au

These two non-alcoholic products are gainingtraction and will be a hit with your shoppers.

Great Northern Zero is a 0.0 percent alcohol beer, brewed with an outdoor lifestyle in mind. With its fruity aroma and crisp finish, it is the ultimate 0.0 per cent alcohol refreshment for your favourite adventure.

The Great NorthernZero recipe has gone through an alcohol removal process and then blended to create a crisp 0.0 per cent alcohol beer without compromising on taste. Aroma and taste features deep golden hues and a fruity aroma that carries through to the palate. Great Northern Zero has a balanced sweetness that is complemented with subtle bitterness. It finishes clean and crisp.

Wolf Blass, one of Australia’s most iconic and award-winning wine brands, has tapped into the rapidly growing non-alcoholic trend by introducing a refreshing new portfolio of zero alcohol wines to its stable of excellence.

The range consists of a Sparkling Cuvée, Shiraz, Sauvignon Blanc and most recently launched, a Rosé, available in stores such as Dan Murphy’s and Woolworths Grocery. This lower in calorie, lower in sugar, exciting new offering is underpinned by Wolf Blass’ ability to continually innovate and evolve, whilst still striving to deliver on quality and taste so that consumers can moderate, but without the compromise.