Published in the Summer 2025 issue of Artisan Spirits Magazine.
Over the past 2 years, there has been an explosion of low and no alcohol spirits. International Wine and Spirits Record (IWSR) estimates a +4% volume compound annual growth rate for low and no alcohol products from now until 2028.
Drivers of Low and No Alcohol Consumption
A December 2024 NCSolutions survey found that 49% of Americans are aiming to reduce their alcohol consumption in 2025, an increase from 44% in 2023. In 2024, 25% of Americans did not drink at all. While moderating and abstaining from drinking are not new concepts, there are some additional factors that are contributing to the current trend:
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- Post-COVID Drinking Burnout
A study by Keck Medicine of USC estimated that Americans’ heavy alcohol use increased by 20% during the 2020 pandemic and continued to remain at an elevated level into 2022. This rapid and dramatic increase in consumption lead to record sales numbers in the alcohol industry, numbers some assumed were the new normal, but as the population returned to “real life”, some consumers considerably dialed back their drinking.
- Post-COVID Drinking Burnout
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- Prevalence of Weight Loss Drugs
As of 2024, 13% of Americans had used GLP-1 weight loss drugs such as Ozempic and a 2025 AP News report shows that half of Americans approve of using these drugs – meaning that usage is likely to continue to increase. These drugs suppress appetite and may make drinking alcohol less appealing.
- Prevalence of Weight Loss Drugs
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- A General Desire to be Healthier
According to Statista, the #2, #3, and #4 most popular New Year’s resolutions for 2025 in the United States all are aligned with becoming healthier. This reduction in drinking for health reasons is not limited to a singular generation. According to NCSolutions, 58% of Gen Z cited mental health and 48% of Baby Boomers cited weight loss as their drive to abstain from alcohol.
- A General Desire to be Healthier
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- Aging
According to the National Institute on Aging (2022), as adults grow older, alcohol can lead to more complications. It can interact with medications and exacerbate existing health conditions. Additionally, older adults can become more sensitive to the effects of alcohol, potentially leading to accidents, injuries, or changes in mental health.
- Aging
According to IWSR, the no alcohol sector is expected to grow to $4 billion+ by 2028. This is a ripe opportunity and a potential new income stream for distillers. NCSolutions found that 20% of people who chose to try a non-alcoholic drink tried it just because they liked the way it looked. The big branding question you need to answer before moving forward with a low or no alcohol product is: What should the packaging look like? The short answer is: Differentiated from your current packaging. How different the packaging should be from your current packaging depends on your business model.
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- House of Brands Model
If your company follows a house of brands model and you have the bandwidth to support a new brand, developing a new low or no alcohol brand will help create a clear demarcation from your full-proof alcohol brand. Not only can the design look completely different, but you can also develop a brand name that communicates low or no alcohol and your marketing efforts can further reinforce this messaging. However, this also entails the time and investment necessary to build a new brand.
- House of Brands Model
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- Branded House Model
Offering a new low or no alcohol product that bears the same brand name as your current line allows you to take advantage of your existing brand recognition. Your customers are already familiar and enjoy your spirits so it’s not a huge leap for them to try your low or no alcohol spirits. This strategy also allows you to appeal to an occasion-based drinker providing product options for days when they want to drink alcohol and also for when they want to abstain. However, you do not want a consumer to mistake your new low or no alcohol product as a traditional alcohol content product – nor do you want the opposite to happen. To avoid this, there are a couple devices that you can employ to prevent confusion:
- Branded House Model
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- Color Coding: Color is a great way to help differentiate products because it doesn’t require any reading. At a quick scan, it allows your consumers to immediately notice that a product is unique.
- Flavor Cues: Many products in the low and no alcohol space emphasize their ingredients and flavor profile to help differentiate from other products and to generate excitement about their taste. This can be accomplished through colors, text, or inviting illustrations of the flavors and ingredients.
- Sub-Brand Name: Developing a secondary brand name that speaks to the low or no alcohol promise can be a great method to build off your brand recognition and create a separate identity for your new low or no alcohol products.
- Emphasize Proof: Drawing extra attention to the lower proof of your product by making it larger than it normally would be on your package will help prevent mix ups. For no alcohol products, use phrases such as “No Alcohol”, “Non-Alcoholic”, “Alcohol Removed”, or “Zero Proof”.
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While store shelves and bar menus are increasingly offering low and no alcohol options, some customers need reassurance before branching out into these new offerings. On your packaging consider including recipes or images of cocktails and where the product can be used as a substitute for alcohol in traditional cocktails to encourage consumers to utilize your low and no alcohol products in the same manner as your traditional spirits.
The growing demand for low and no alcohol spirits presents an exciting opportunity for distillers to expand into a new market and find new revenue streams. As the market expands, encouraging consumers to embrace these options through creative packaging will be key to long-term success in the low and no alcohol segment.
Photo by: Egor Myznik from Unsplash.
- The Rise of Low & No Alcohol Spirits: A $4 Billion Bandwagon - July 21, 2025
- The Private Label Opportunity and Bulk Spirits - March 25, 2025
- Bulk Spirits Opportunities & Your Brand - January 10, 2025
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