Zenith Global 2019 European Zero Alcohol Report

Zenith Global Report

2019

European Zero Alcohol Drinks An overview of the European zero alcohol drinks market.

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Contents Section 1. Introduction and scope 2. Executive Summary 3. European zero alcohol drinks market overview 4. European zero alcohol drinks opportunities 5. Zero alcohol drinks market analysis: UK Russia

Germany Spain 6. Brand profiles

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Introduction and scope

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1. Introduction and scope Overview Commentary

Scope Commentary

The data presented in this report covers the following countries •East Europe: Belarus, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Ukraine

•West Europe: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, UK

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1. Introduction and scope Definition Zero alcohol drinks For the purposes of this report, Zero-alcohol drinks are defined as beverages containing less than 0.5% alcohol by volume (abv), marketed as alternatives to beer, cider, wine and spirits. The market thus includes: Zero-alcohol beer Zero-alcohol cider Zero-alcohol wine Zero-alcohol spirits Whilst zero-alcohol beer, cider and wine are marketed as drinks offering all the characteristics of their alcoholic counterparts, except the alcohol, zeroalcohol spirits differ, in that it is not possible to remove the alcohol from spirits and still have spirits. Zero-alcohol spirits are thus defined as botanical/herbal distillations clearly marketed as alternatives to spirits, most commonly gin.

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Executive summary

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2. Executive summary Key findings Commentary

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European zero alcohol drinks market overview

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3. European Zero alcohol drinks market overview Sub-regions’ Zero alcohol drinks volume and value share Zero alcohol drinks volume share by sub-region, 2018

50.0%

West Europe East Europe 50.0%

Zero alcohol drinks value share by sub-region, 2018

25.0%

West Europe East Europe

75.0%

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Commentary

3. European Zero alcohol drinks market overview Zero alcohol drinks market volume and value Million litres Zero alcohol drinks market volume and % growth 16,000

% growth 12.0%

10.0%

14,000

8.3%

9.1%

12,000

10.0%

7.7%

7.1%

10,000 8,000

8.0% 6.0%

6,000

4.0%

4,000 2.0%

2,000 0

0.0% 2013

2014

2015

2016

Volume in million litres

Million litres

2017

2018

% change

Zero alcohol drinks market value and % growth

3,600

3.4% 3.3%

3,500

3.3%

3,400

3.2%

3,300

3.2% 3.1%

3,200

3.1% 3.0%

3,100

2.9%

3,000

3.0% 2.9%

2,900

2.8%

2,800 2,700

2.7% 2013

2014

2015

2016

Value in million Euros

11

% growth

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2017 % change

2018

Commentary

3. European Zero alcohol drinks market overview Top 4 Zero alcohol drinks consumption countries Commentary

Top 4 countries by volume, 2018 5.0%

25.0% 20.0%

Country A

Country B Country C Country D Others 25.0%

25.0%

Top 4 countries by value, 2018

5.0%

25.0% Country A

20.0%

Country B Country C Country D Others 25.0% 25.0% 12

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3. European Zero alcohol drinks market overview Zero alcohol drinks price evolution and comparison with other categories Commentary

Zero alcohol drinks price evolution

Euro 8.00 6.00 4.00

2.00 0.00

2013 2014 2015 Average price per litre (ppl) Country b ppl Country e

2018 price per litre - Euro

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Beer

2016

Wine

2017 2018 Country a ppl Country c ppl

Spirits

2019

Mocktails

3. European Zero alcohol drinks market overview Consumer profile Commentary

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3. European Zero alcohol drinks market overview Zero alcohol drinks market forecast Zero alcohol drinks volume share by sub-region, 2023f

East Europe West Europe 50.0%

50.0%

Top 4 countries by volume, 2023f Country A 20.0%

Country B 20.0%

Country C Country D Others

20.0% 20.0% 20.0%

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Commentary

3. European Zero alcohol drinks market overview Zero alcohol drinks market forecast Commentary

Zero alcohol drinks market volume and % growth 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0

16.7%

12.5%

14.3% 0.0%

0.0% 2018

0.0% 2019f

2020f

2021f

2022f

Volume in million litres

18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0%

2023f

% change

Zero alcohol drinks market value and % growth 33.3%

9,000

35.0%

8,000

30.0%

25.0%

7,000

20.0%

6,000

16.7%

5,000 4,000

25.0% 14.3%

9.1%

15.0%

3,000

10.0%

2,000

5.0%

1,000 0

0.0% 2018

2019f

2020f

2021f

Value in million Euros

16

20.0%

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2022f % change

2023f

4

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European Zero alcohol drinks opportunities

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4. European Zero alcohol drinks opportunities Highest growth countries Countries with the highest volume CAGR % 2018-23 Country D

25.0%

Country C

25.0%

Country B

25.0%

Country A

25.0%

0.0%

10.0%

20.0%

30.0%

Zero alcohol drinks market size in the highest growth countries

Million litres 1000

Country A 800

Country B

600

Country C

400

CountryD

200 0 2018

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2023

Commentary

4. European Zero alcohol drinks opportunities Countries with the highest opportunities Volume CAGR % 2018-23

Zero alcohol drinks dynamics by country - forecast

Countries with the biggest volume gains between 2018 and 2023 Country F

35%

Bubble size shows 2023 volume

225.0

Country E

200.0

Country D

30%

150.0

Country C 25%

115.0

Country B

85.0

Country A

20%

0.0

Commentary

15%

10%

5%

0% 0.00

2.00

4.00

6.00

8.00

10.00

12.00

-5%

-10%

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Per capita consumption in 2023 (litres) Š Zenith Global Ltd 2019

14.00

50.0

100.0

150.0

300.0 Additional volume in million litres 200.0 250.0 300.0 350.0

4. European Zero alcohol drinks opportunities Zero alcohol drinks SWOT analysis

S

Strengths

Commentary

O

Opportunities

Commentary

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W

Weaknesses

Commentary

T

Threats

Commentary

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Zero Alcohol drinks market analysis United Kingdom

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UK zero alcohol drinks market overview Zero alcohol drinks market volume and value Commentary

Zero alcohol drinks market volume and % growth 50

30.0%

45 20.0%

40

15.0%

35 30 5.0% 25

10.0%

20 -10.0%

15 10 2013

2014

2015

2016

2017

Volume in million litres

35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% -5.0% -10.0% -15.0%

2018

% change

Zero alcohol drinks market value and % growth 350 40.0%

300 250

30.0%

200

25.0% 20.0%

150 100

10.0%

50 2013

2014

2015

2016

Value in million Euros

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2017 % change

2018

45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0%

UK zero alcohol drinks market overview Zero alcohol drinks variants and packaging Zero alcohol drinks types - % volume share, 2018

Zero alcohol drinks sectors Commentary

34.0% 33.0%

33.0% Beer

Wine

Others

Packaging volume % share, 2018

50.0% 50.0%

Glass bottles 23

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Cans

United Kingdom zero alcohol drinks market overview Zero alcohol drinks price evolution and comparison with other categories Commentary Local currency

Zero alcohol drinks price evolution

Euro

6.00 5.00 4.00 3.00 2.00 1.00 0.00

8.00 6.00 4.00 2.00 0.00 2013

2014

2015

2016

2017

2018

2019

Price per litre in the local currency Price per litre in Euros

2018 price per litre

Local currency

Euro

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Beer

Wine

Spirit

Mocktail

United Kingdom zero alcohol drinks market overview Consumer and recent innovations Consumer profile Commentary

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UK zero alcohol drinks market overview Top players and innovations

Top zero alcohol drinks producers by volume, 2018 10.0%

20.0%

Top Players Commentary

10.0%

20.0%

20.0% 20.0%

Brand A Brand C Brand E Innovations Commentary

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Brand B Brand D Others/Private label

UK zero alcohol drinks market overview Zero alcohol drinks market forecast Commentary

Zero alcohol drinks market volume and % growth 50 45 40 35 30 25 20 15 10 5 0

15.0%

15.0%

15.0%

15.0%

15.0%

15.0%

16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0%

2018

2019

2020

2021

Volume in million litres

2022

2023

% change

Zero alcohol drinks market value and % growth 15.0%

450

15.0%

15.0%

15.0%

440

430

16.0% 14.0%

10.0%

12.0%

10.0%

420

10.0%

410

8.0%

400

6.0%

390

4.0%

380

2.0%

370

0.0% 2018

2019

2020

2021

Value in million Euros

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2022 % change

2023

UK zero alcohol drinks market overview Zero alcohol drinks SWOT analysis

S

Strengths

Commentary

O

Opportunities

Commentary

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W

Weaknesses

Commentary

T

Threats

Commentary

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Zero Alcohol drinks market analysis Russia

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Russia zero alcohol drinks market overview Zero alcohol drinks market volume and value Zero alcohol drinks market volume and % growth 50 45 40 35 30 25 20 15 10 5 0

30% 25%

35% 30%

20%

25% 20%

15%

15%

10%

10% 5% 0% 2013

2014

2015

2016

Volume in million litres

2017

2018

% change

Zero alcohol drinks market value and % growth 250

40%

32%

30%

200

20%

12%

7%

150 100

0%

-10%

-10%

-18% 50

-20%

0

-30% 2013

2014

2015

2016

Value in million Euros

30

10%

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2017 % change

2018

Commentary

Russia zero alcohol drinks market overview Zero alcohol drinks variants and packaging Zero alcohol drinks types % volume share, 2018 0.10%

Zero alcohol drinks variants Commentary

50.0% 49.9%

Beer

Wine

Others

Packaging volume % share, 2018 0.1%

Zero alcohol drinks packaging Commentary

49.9% 50.0%

Glass bottles

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Cans

Others

Russia zero alcohol drinks market overview Zero alcohol drinks price evolution and comparison with other categories Commentary Local currency

Zero alcohol drinks price evolution

Euro

120 100 80 60 40 20 0

2.50 2.00 1.50 1.00 0.50 0.00 2013

2014

2015

2016

2017

2018

Price per litre in the local currency Price per litre in Euros

2018 price per litre

Local currency Euro

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Beer

Wine

Others

2019

Russia zero alcohol drinks market overview Consumer and recent innovations Consumer profile Commentary

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Russia zero alcohol drinks market overview Top players and innovations

Top zero alcohol drinks producers by volume, 2018

Top Players 20.0%

Commentary

20.0%

20.0% 20.0% 20.0%

Brand A

Innovations Commentary

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Brand B

Brand C

Brand D

Others

Russia zero alcohol drinks market overview Zero alcohol drinks market forecast Commentary

Zero alcohol drinks market volume and % growth 140

25.0%

120

20.0% 20%

100 80

15.0%

15.0% 15%

60

10.0%

10% 10%

40

5.0%

20

5%

0

0.0% 2018

2019f

2020f

2021f

2022f

Volume in million litres

2023f

% change

Zero alcohol drinks market value and % growth 400

16%

350

14%

300

12%

14%

250 200 150

10% 9% 7%

8%

9% 7%

6%

6%

100

4%

50

2%

0

0% 2018

2019f

2020f

2021f

Value in million Euros

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2022f

2023f

% change

Russia zero alcohol drinks market overview Zero alcohol drinks SWOT analysis

S

Strengths

Commentary

O

Opportunities

Commentary

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W

Weaknesses

Commentary

T

Threats

Commentary

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Zero Alcohol drinks market analysis Germany

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Germany zero alcohol drinks market overview Zero alcohol drinks market volume and value Commentary

Zero alcohol drinks market volume and % growth 180 175 170 165 160 155 150 145 140 135

8.0%

2013

8.0%

8.0%

2014

2015

8.0%

2016

9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0%

8.0%

2017

Volume in million litres

2018

% change

Zero alcohol drinks market value and % growth 300

15.0%

15.0%

15.0%

15.0%

15.0%

16.0% 14.0%

12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0

0.0% 2013

2014

2015

2016

Value in million Euros

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2017 % change

2018

Germany zero alcohol drinks market overview Zero alcohol drinks variants and packaging Zero alcohol drinks variants Zero alcohol drinks types - % volume share, 2018

Commentary

34.0%

33.0%

33.0% Beer

Wine

Others

Zero alcohol drinks packaging Commentary

Packaging volume % share, 2018 25.0% 25.0%

25.0% Glass bottles

39

25.0% PET bottles

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Cans

Others

Germany zero alcohol drinks market overview Zero alcohol drinks price evolution and comparison with other categories Commentary Local currency

Zero alcohol drinks price evolution

6 5 4 3 2 1 0 2013

2014

2015

2016

2017

2018

Price per litre in the local currency

2018 price per litre

Euro

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Beer

Wine

Spirit

Mocktail

2019

.

Germany zero alcohol drinks market overview Consumer and recent innovations Consumer profile Commentary

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Germany zero alcohol drinks market overview Top players and innovations Top Players

Top 5 zero alcohol drinks producers by volume, 2018 10.0%

Commentary 20.0%

10.0%

20.0% 20.0%

Brand A

Innovations

Commentary

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Brand B

Brand C

20.0% Brand D

Brand E

Others

Germany zero alcohol drinks market overview Zero alcohol drinks market forecast Commentary

Zero alcohol drinks market volume and % growth 225

5.0%

5.0%

220

5.0%

5.0%

5.0%

5.0%

6.0% 5.0%

215

4.0%

210 3.0% 205 2.0%

200

1.0%

195 190

0.0% 2018

2019f

2020f

2021f

Volume in million litres

2022f

2023f

% change

Zero alcohol drinks market value and % growth 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0

16.0% 15.0% 15.0%

15.0%

15.0%

15.0%

14.0%

12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2018

2019f

2020f

2021f

Value in million Euros

43

15.0%

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2022f

2023f

% change

Germany zero alcohol drinks market overview Zero alcohol drinks SWOT analysis

S

Strengths

Commentary

O

Opportunities

Commentary

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W

Weaknesses

Commentary

T

Threats

Commentary

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Zero Alcohol drinks market analysis Spain

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Spain zero alcohol drinks market overview Zero alcohol drinks market volume and value Commentary

Zero alcohol drinks market volume and % growth 400.0

0.0%

350.0

-1.0%

300.0 -2.0%

250.0 200.0

-3.0%

150.0 100.0 -5.0%

50.0

-5.0%

-5.0%

-5.0%

-4.0%

-5.0%

-5.0%

0.0

-6.0% 2013

2014

2015

2016

Volume in million litres

2017

2018

% change

Zero alcohol drinks market value and % growth 120.0

0.0%

100.0

-1.0%

80.0

-2.0%

60.0

-3.0%

40.0

-5.0%

-5.0%

-5.0%

-5.0%

-5.0%

20.0

-5.0%

-

-6.0%

2013

2014

2015

2016

Value in million Euros

46

-4.0%

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2017 % change

2018

Spain zero alcohol drinks market overview Zero alcohol drinks variants and packaging Zero alcohol drinks types - % volume share, 2018 20.0%

Zero alcohol drinks variants Commentary

20.0%

20.0%

20.0%

20.0% Beer

Wine

Spirit

Mocktail

Others

Packaging volume % share, 2018

Commentary

25.0%

25.0%

25.0% Glass bottles

47

Zero alcohol drinks packaging

25.0% Cans

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Cartons

Others

Spain zero alcohol drinks market overview Zero alcohol drinks price evolution and comparison with other categories Commentary Local currency

Zero alcohol drinks price evolution

Euro

1.20 1.00 0.80 0.60 0.40 0.20 0.00

6.00 5.00 4.00 3.00 2.00 1.00 0.00 2013

2014

2015

2016

2017

2018

2019

Price per litre in the local currency Price per litre in Euros

2018 price per litre

Local currency

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Beer

Wine

Spirit

Mocktail

Others

Spain zero alcohol drinks market overview Consumer and recent innovations Consumer profile Commentary

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Spain zero alcohol drinks market overview Top players and innovations Top Players

Top 5 zero alcohol drinks producers by volume, 2018

Commentary

10.0% 20.0% 10.0%

20.0% 20.0%

Brand A Innovations Commentary

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Brand B

20.0% Brand C

Brand D

Brand E

Others

Spain zero alcohol drinks market overview Zero alcohol drinks market forecast Commentary

Zero alcohol drinks market volume and % growth 350 300

2.5%

2.0%

2.0%

2.0%

2.0%

2.0%

2.0% 2.0%

250 200

1.5%

150

1.0%

100

0.5%

50 0

0.0% 2018

2019f

2020f

2021f

Volume in million litres

2022f

2023f

% change

Zero alcohol drinks market value and % growth 1,200

5.0%

5.0%

5.0%

5.0%

5.0%

5.0%

6.0%

1,000

5.0%

800

4.0%

600

3.0%

400

2.0%

200

1.0%

0

0.0% 2018

2019f

2020f

2021f

Value in million Euros

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2022f % change

2023f

Spain zero alcohol drinks market overview Zero alcohol drinks SWOT analysis

S

Strengths

Commentary

O

Opportunities

Commentary

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W

Weaknesses

Commentary

T

Threats

Commentary

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Brand profiles

© Zenith Global Ltd 2019

6. Brand profiles Lager

Heineken 0.0 Heineken, Country website

Product information: Alcohol-free lager Launch date: 2017 Positioning and channels: Commentary Pack size and type: Price:

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