The London show Low2No Bev-2022 provided a great opportunity to see how the adult beverage category is evolving. The market for alcohol alternatives with no doubts can be considered the locomotive of the entire industry of non-alcoholic and low-alcohol drinks. We talk about new products in an attempt to convince readers of the possibilities and prospects of the innovative category. Teaser: They are impressive.
“Our relationship with alcohol is at the beginning of a generational shift,” said Mark Livings, co-founder of Lyre’s Spirits, who recently took over the Adult Soft Drinks Association (ANBA) in the UK and Europe as Chairman of the Board.
The European organization is launched by the North American ANBA, which was itself created late last year. According to Global Market Insights, professionals in the alcohol alternatives industry want to bring together adult soft drink brands around the world in order to promote and more actively develop this segment.
The goal is ambitious. According to IWSR forecasts, the category of non-alcoholic and low-alcohol drinks is expected to grow to $30 billion by 2025, with an average annual growth of a respectable 8% (CAGR 2021-2025) compared to the typical alcohol market growth of only 0.7% over the same period. In our opinion, this estimate is very conservative.
Even five years ago, the very concept of “non-alcoholic alcoholic drink” caused skepticism. This is happening now, although industry pioneers have been mastering the segment for a long time and just as successfully. We are witnessing how a niche direction is turning into a powerful functional industry, the various segments of which we have repeatedly talked about in specialized reviews. It’s time for specialized drinks for adults.
But let’s talk about everything in order. First, a few words about what a “Low-No drink” is. Our explanation does not pretend to be a reference, but it will allow you to understand what “alternative alcohol” is.
Ultra-realistic non-alcoholic alcohol alternatives mimic the smell, taste, and even «control burn» of alcohol, with the full aftertaste feel of classic alcoholic beverages.
Such decisions were a response to social challenges to meet the needs of the category of consumers who would like to enjoy alcoholic beverages, but without the adverse health consequences of their use, usually associated with this.
If low-alcohol drinks include products with a strength of 0.5% or less, then the definition of the Low-No category is more complex, even though they do not contain alcohol. On the labels of such products, there is no usual “percentage” measure of strength, which we see on alcohol bottles. But despite the fact that these drinks are completely non-alcoholic in essence and composition, they are developed and sold exclusively for adult customers who have reached the age of majority.
The definition of low-no drinks includes products with functional benefits desired by an adult audience who would otherwise normally consume a classic alcoholic beverage.
This is an important caveat. Category representatives do not want their products mixed with classic soft drinks, juices, etc. They produce a very different range of drinks than the soft drink industry, and therefore follow the regulations and advertising restrictions of the alcohol industry, which — we are well aware — only increase with time.
The ANBA professional association was created precisely to respond to these challenges. And at the same time to regulate the rules of the new Low-No industry, which is being created right before our eyes.
Long term prospects
The growth of non-alcoholic beverages (and, in parallel, the category of low-alcohol drinks) is a response of manufacturers to changing consumer trends. People want to drink less or are ready to give up alcohol completely, paying more attention to their health. At the same time, they would not want to give up the usual parties and festivities, the main attribute of which is alcohol.
Industry response to this dilemma was a variety of «healthy drinks» of excellent quality, intended for adult consumers, no matter how strange such a statement may sound.
As the Low-No category grows, it becomes more diverse with innovation spreading to new ingredients and technologies. Whichever way it moves now, players will rely on fundamental trends in health, wellness and modern scientific ways to produce drinks with additional properties. This approach will set the tone for the entire soft drinks segment over the next few years.
At the current moment, we are really seeing an epochal shift in the alcohol industry. And the growth in the production of beverages in the Low-No category will only continue. Which means the emergence of opportunities for the emergence of new players and their capture of their market share.
And while we are preparing a detailed review of the development of the alcohol-non-alcoholic alternatives market, it is time to talk about the new products presented at the only specialized exhibition Low2No Bev, held September 26-28 at Olympia London. The products highlighted in the review draw attention to the latest market trends and drivers of the newest category in the beverage industry.
Let’s start with one of the most interesting new products on the market from the Sentia brand. The company set out to reproduce not only the taste and smell of a classic alcoholic drink, but also its effect.
Launched last year, the patented formula is a unique herbal product designed to activate the gamma-aminobutyric acid (GABA) neurotransmitters found in the brain. The use of classic alcohol affects the GABA system and enhances it, making us feel more relaxed and sociable when drunk.
The brand’s product mimics this effect by stimulating a relaxing «feel good» feeling similar to that experienced with regular alcoholic beverages.
Behind the scientific development of Sentia is the duo of Professor David Nutt, a neuropsychopharmacologist and former chief scientist at GABA Labs, and «botanical alchemist» Vanessa Jacoby. It’s the first functional drink of its kind: Some CBD drinks promise similar effects but target a different receptor in the human brain.
With a rich red drink (composed of rose, hawthorn, licorice, linden flowers, passionflower and hibiscus, as well as agave syrup), you can really get drunk. A fairly noticeable effect after taking a serving of Sentia lasts about 20-30 minutes. For a party, you can easily get drunk, but without the unpleasant consequences of a hangover in the morning.
London-based producer Salcombe Distilling, which recently expanded its range of non-alcoholic alternatives under the New London Light brand, was unveiled by co-founder Howard Davies.
Named after the iconic lighthouse at the entrance to Long Island Sound’s deep water harbor, New London Light was once a landmark for 19th-century fruit schooner crews that traded exotic fruits and spices with the New World. The manufacturer still draws inspiration from this rich history.
Three new gin-style SKUs: Aegean Sky (Mediterranean bitter citruses and olives) and Midnight Sun (wild northern coastal berries, pine and seaweed) join First Light (classic dry juniper, vibrant citruses and ginger) — world-class sugar-free soft drinks and allergens. The inspiring flavor profiles of each variety are inspired by the spirit of sea adventure, in which every taste is a new unforgettable journey.
Fans of the brand appreciated this approach. It is worth noting that the version of NLL with the aroma of freshly cut grass, ylang-ylang, pink grapefruit and sage and taste with accents of cucumber, melon peel and hints of coriander, released in partnership with the Marine Conservation Society and SeaTrees by Sustainable Surf, an environmental charity communities and scientists who restore coastal ecosystems received a score of 94 out of 100 on tastings.com.
In addition, for every 4 bottles sold in the US, SeaTrees will regenerate 1 square foot of giant seaweed in California. A worthy mission to restore ocean wildlife!
The Rebels 0.0% brand comes from Switzerland. The company offers a wide range of non-alcoholic spirits in the style of gin, rum, liqueurs and spritzers. Rebels 0.0% soft drinks are inspired by authentic classics and mimic them in a very sophisticated and elegant way.
Speaking about his drinks, co-founder and CEO Janick Planzer explained that typical ingredients such as juniper and botanicals in gin, sugar cane molasses and oak bark in rum are typical ingredients in the company’s drinks. A small amount of chili extract is used to mimic the effect of alcohol.
The recipes, of course, are kept secret, but the taste is quite familiar gin and rum, and at the same time a great alternative base for long drinks and cocktails.
Today’s consumers want their soft drinks to be complex and layered. After spending 30 years searching, researching and teaching, Bax Botanics (founded in 2019) believes that botanicals are the way forward in creating the desired flavors in modern low-no drinks.
The founding duo of Chris and Rose Bucks spent decades studying and experimenting with botanical fragrances. Over 30 years of cumulative experience in advising the food industry with a focus on wild ingredients and herbs has resulted in a secret recipe of herbs, roots, berries and flowers in the form of alcohol alternatives with an extraordinarily beautiful label layered with beautifully complex flavors on the bottle.
With the help of years of knowledge and experience, the manufacturer has managed to reproduce sustainable non-alcoholic drinks exclusively from natural, organic and exciting ingredients. The founders’ experiments never stop: innovation is driving the 0% ABV industry forward.
Mainly represented in the Low-No market, low-alcohol and non-alcoholic beverages are successful due to the sophisticated premium branding with muted colors and minimalist design.
The bottles of the Caleno brand stand out for their tropical flair: the Colombian-inspired drink brand is now one of the oldest and more established spirits in the category.
Founded in 2017, the brand is present in major UK supermarkets such as Sainsbury’s, Waitrose and M&S, as well as specialty retailers and Amazon.
Soft drink brand ISH Spirits is from Copenhagen. According to International Sales Director Henning Kallesen, the Danish capital’s alternative alcohol market is not that far behind London’s. In some respects, the manufacturer is noticeably in the lead.
ISH offers the European consumer a wide range of ready-to-drink RTD soft drinks: SpritzISH, GinISH and Tonic and DaiquirISH, rum, gin, two sparkling wines (the emerging trend of premium wines in aluminum cans is worth discussing separately) and a spritzer. The entire range is made from natural ingredients and without added sugar.
The manufacturer’s goal was to create alternatives so close to the original that few, if any, could distinguish their products from the alcohol prototypes. So far, ISH has come closest to what we have found.
Fun fact, when ISH launched SpritzISH, promoters on the streets of Copenhagen were offering a novelty in the form of a blind test to see if people could guess how much alcohol was in the drink (it was 0%). All participants in the tastings suggested that this is a classic Aperol, the smell, taste, bubbles and feeling of an authentic alcoholic drink were so fantastically reproduced.
The company Mindful Drinking was founded in 2018. Today, its products are available in 15 European markets and have won 9 medals at the 2021 Bartenders’ Brand Awards.
Another interesting novelty from the Bemuse brand. The manufacturer has rethought the world’s oldest drink — mead. The result was a non-alcoholic, bubbly, low-calorie drink with a modern twist, designed to stand out from the boom in low-alcohol beers, wines and ciders, while giving its customers an extraordinary consumer experience.
Meads are alcoholic drinks based on honey with the addition of fruit or berry juices. This is a relatively new product on the alcohol market, despite the fact that its traditions go back to the early Middle Ages. Creating a new drinking experience, the founders of the company (surprisingly, these are two charming girls) found mead to be the most intriguing because of its history and the opportunity to reinvent a drink that would be unique, exciting and complex, but also tasty and healthy.
Since its foundation in 2020, Bemuse has released a range of award-winning sparkling meado alternatives worthy of Henry XIII himself. The line includes four mead SKUs: raspberry, cardamom ginger, tarragon and basil. They can be enjoyed on their own or mixed with other drinks and a couple of ice cubes.
To create a natural fermentation, only natural ingredients are used in the production — honey, water and yeast. In the later stages, several natural botanical ingredients are added to the drink for unique flavors (mead aromas are not particularly harsh, and subtle floral and hop aromas are felt when poured).
Bemuse has created an interesting and unique non-alcoholic experience with their meads. Adding to the intrigue is the fact that, unlike their colleagues in the shop, reforming the established types of alcoholic beverages, the founders set their sights on a segment that was just emerging. It will be interesting to watch their progress.
«Zero Degree» Bright Future
Our review included only the smallest part of what was presented at Low2No Bev 2022. Among the exhibitors were local brands Savyll Beverage, Athletic Brewing Company (actively exploring the promising alternative alcory market in Canada and Australia, with a big eye on the potential of Europe), Big Drop Brewing Co., British brand Britvic (produces luxurious non-alcoholic cocktails The London Essence), of course Lyre’s Spirits Co (perhaps the most famous manufacturer, whose portfolio includes 13 different alcohol alternatives from gin, whiskey, rum, vermouth and even absinthe, to non-alcoholic liqueurs and Amaretto), as well as such «monsters» of the beverage industry as Keurig Dr Pepper, Bacardi and Asahi UK.
And dozens of other producers from non-alcoholic beer, cider and wine (non-alcoholic wine has long been mainstream) to Low-No premium drinks, liquors and cocktails — a separate sub-segment with its own bright representatives and unusual finds. There are about 60 exhibitors in total, which in itself characterizes the activity of the industry.
Most of the big names involved are on the founding board of ANBA UK/EU, which claims to be a paradigm-changer in the spirits segment.
2021 has been a huge year for this category. Nervousness for manufacturers was added by Covid restrictions, and the breakdown of the usual supply chains, and rising prices for raw materials. However, the category pioneers have managed to please health-conscious consumers who don’t want to «give up fun without degrees.» And the post-COVID desire of consumers for a healthy lifestyle and their own health will only fuel the potential of the category.
The professional event itself is also young – the first Low2No Bev exhibition took place last year. And although experts then warned that “the sector lacks clarity,” much has changed in a positive direction in 2022. This could easily be noted both within the exhibition exposition and in a rich program of conferences and seminars on key industry issues from regulatory and political risks, to marketing issues and the preparation of ideal non-alcoholic cocktails. In general, the classic questions that the category may face in the coming months and years.
Are price and presence still the main barriers to sales growth? And could category drivers be more complex than just global health and wellness trends? The search for answers to these questions will be an occasion to talk about this innovative segment again. So we don’t say goodbye for long.