Low and No alcohol – the ‘at home’ perspective
In celebration of the launch of our low and no research report, we’ve spoken to a number of industry experts to gain different perspectives into the low and no opportunity. These include alcohol free spirits brands, low and no beer brands, retailers and on-trade operators.
In this blog Jessica Markowski, Sales Director – Convenience and Wholesale at Budweiser Brewing Group, shares her thoughts on why low and no is growing, and why Budweiser have invested in low and no beer brands for the ‘at-home’ consumer.
Why did Budweiser launch a no alcohol brand?
The low and no alcohol remit is clearly booming, with 7% of households now purchasing non-alcoholic beer or cider once a year.1
As such, there is huge potential for retailers to tap into this trend by offering a variety of no and low ABV beer and cider. Variety is the key word here. In order to maximise sales, it is vital that retailers are offering choice when it comes to low and no alcohol – not just offering options to ‘tick a box’.
“We’ve set ourselves the goal of ensuring no or low alcohol beer products represent at least 20% of our global beer volume by the end of 2025.”
Consumers are offered a range of different mainstream beers – varying in flavours, style and format, so why not do the same when it comes to alcohol with a low ABV?
Our range of no and low offerings is part of our Global Smart Drinking Goals, a set of programs and initiatives focused on shifting social norms, consumer behaviours, and our own business practices – in order to make a tangible contribution to the reduction of harmful use of alcohol globally.
As part of this, we’ve set ourselves the goal of ensuring no or low alcohol beer products represent at least 20% of our global beer volume by the end of 2025.
Have you seen growth overall? In the Convenience channel?
We have seen great growth in the off-trade. In fact, the non-alcoholic beer and cider market is now worth £69.8m a year to the off-trade. It has grown by 147% since 2015 when it was worth £28.2m a year.2
The growing market demonstrates a real opportunity for retailers to capitalise on. Within the no alcohol market, beer remains by far the largest segment making up 87% of all non-alcoholic beer and cider sales in the impulse channel.3
Therefore, while it’s important for retailers to stock both non-alcoholic beers and ciders, retailers need to consider the ratio of one another and prioritise non-alcoholic beer. This is particularly important in the convenience channel where retailers may be short of space.
For example, putting these options next to the till and clearly signposting they contain no alcohol will tap into people looking to reduce their alcohol consumption but who still enjoy the great taste of beer.
What do you think is driving the growth in low and no? Where do you see the future of the category?
The growth in this category can be attributed to the rise of the health-conscious consumer, with 63% of UK adults trying to consume healthily all or most of the time.4
As a result, what we are seeing is that these beer drinkers are more likely to opt for low calorie/ low ABV options to fit into their healthier lifestyles. For example, someone who regularly trains at a gym may be looking for a non-alcoholic beer to enjoy at their friend’s party to allow them to train the following day as well.
Looking ahead to 2020, the no and low category is showing no signs of letting up, and as such we can expect to see brands continue to expand on their low and no alcohol portfolios throughout the year.
Any advice for retailers on how to grow it?
The key point for retailers to remember is that there is no ‘one-size-fits-all approach’ and it is important to offer a wide variety of choice when it comes to low and no alcohol options.
This is especially true for the convenience store sector and the spontaneous shopping patterns often seen in this space. For example, where shoppers may pop in on their way to a dinner or party – picking up last minute food and drink items to take along with them. To maximise sales, it’s vital to have a well-stocked beer fridge with plenty of options.
Another canny merchandising method retailers can tap into and drives sales is offering beer in a range of formats in order to appeal to varying shopper missions – from those hosting parties to those looking for a quiet night in.
Small packs are the most popular format and make up 77% of all non-alcoholic beer and cider sales in the impulse channel, followed by single cans and bottles which make up 22% of all sales5 – demonstrating the importance of offering a range of formats, and again highlighting that variety is key.
Thank you, Jessica. Some fantastic insights and also advice for retailers to maximise the low and no beers category. Our research shows 1-in-5 have consumed low and no drinks with their dinner. The ‘at home’ opportunity should not be ignored.
KAM’s research report – Low No: The Customer Perspective – is available now.
1 Kantar Worldpanel (MAT w/e 11.08.19) | Total Off-Trade
2 Nielsen Scantrak (MAT w/e 10.08.19) | Total Off-Trade
3 Nielsen Scantrak (MAT w/e 10.08.19) | Total Impulse Channel
4 Mintel Consumer Snacking, May 2019
5 Nielsen Scantrak (MAT w/e 10.08.19)