New research suggests that alcohol brands are facing falling demand for their products as more consumers choose to shun drinking.
The latest Mintel’s British Lifestyles Report found that one in five of UK adults now say they do not drink alcohol, while nearly half (47%) of alcohol buyers/drinkers have cut back or limited the amount of alcohol they’ve consumed in the last 12 months.
But as Brits actively look to curb their alcohol intake, Mintel highlighted that many are prepared to spend more on their drinks. As a result, premiumisation is helping to drive value sales, with overall sales of alcoholic drinks growing by 5.5% between 2017-18 to a total of £21.8bn.
Meanwhile, efforts among consumers to limit or reduce their alcohol intake are creating opportunities for the soft drinks industry. Estimated to be valued at £11.3bn in 2018, the non-alcoholic drinks retail market grew by 15.4% between 2013-18, with ‘adult soft drinks’ among the fastest growing soft drinks segments.
Jack Duckett, Mintel Associate Director of Consumer Lifestyles Research, commented: “The fact that so many Brits are cutting down on the amount of alcohol they drink has proven to be a boon for soft drinks brands. The industry has helped to further drive this demand by launching a raft of new soft drinks – using more sophisticated packaging and flavour profiles to help secure a ‘grown-up’ audience.”
Sainsbury’s announced this week that it would be opening a pop-up pub later this month that will only serve drinks with a maximum alcohol level of 0.5% ABV. The move is designed to showcase the chain’s growing range of low and no alcohol lines which are seeing strong sales growth.
NAM Implications:
- Learnings are clear:
- those that can, push premium
- those in mid-market and value segments, develop/emphasise low-alcohol variants
- Otherwise, think fundamentally, really back to basics (i.e. ’what business are we in’?)
