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Low alcohol beverages refer to the type of drinks with alcohol-by-volume (ABV) of 0.05% to 1.12%. The low alcohol beverage market is experiencing a rapid growth owing to the changing consumer preferences toward healthy products. The consumers are demanding for healthier, tastier, and innovative high-quality low alcohol drinks to maintain their health goals during their routines. This has led the manufacturers to introduce new products without any change in their taste and mouthfeel to suffice the growing consumer demands. Thus, these factors have cumulatively aided in boosting the market growth.
The increasing investments by the manufacturers on low alcohol beverages to improve its taste, variety and, quality has given a positive push to the market. Various product innovations from the manufacturers such as low-calorie and fruit flavoured low alcoholic beverages has gained the consumers attention. For instance, In September 2019, Molson Coors launched Coors Edge, a 0.5% ABV beer in the U.S. to expand its non-alcoholic beverages portfolio in the country.
The growing interest of consumers towards the health and wellness trend in recent years is a major factor driving the low alcohol beverages market. The negative health effects due to consumption of alcoholic beverages such as cardiovascular ailments and high blood pressure has also nudged the consumers to opt for the low alcohol beverage variant, which in turn is propelling the market growth.
The comparatively lower market penetration in the emerging economies is a major restraining factor in the market growth. Further, the established consumer base of alcoholic beverages in the developing countries and low awareness about such products has also negatively impacted the market growth.
Key Market Driver -
Increasing Consumers’ Interest Towards Health and Wellness
Key Market Restraint -
Comparatively Lower Market Penetration in the Emerging Market
The key companies operating in the global low alcohol beverages market are, Anheuser-Busch InBev, Constellation Brands Inc., Heineken N.V., The Boston Beer Co. Inc., llagash Brewing Company, Sapporo Breweries Ltd., Kirin Holdings Co. Ltd., Royal Unibrew AS, Molson Coors Beverage Company, and Carlsberg AS.
The low alcohol beer segment is holding the major share in the market as the consumers are opting for low alcohol beer with bolder and exotic flavours infused with ingredients that aid in complying with the taste of regular beer. Further, the growing popularity of the low alcohol beer among the millennials as a substitute for alcoholic beverages has driven its sales performance.
The hypermarkets and supermarkets are the major distribution channel for the sales of low alcohol beverages due to the availability of numerous product variants in different price ranges and brands. Along with this, the freedom of product selection offered by these mass merchandisers have aided in the product sales growth. The online retail segment is expected to witness a rapid growth as they offer an enhanced digitalized purchasing experience along with numerous discounts on the product prices.
Asia Pacific is expected to exhibit rapid growth in the market owing to the increasing health awareness among the consumers coupled with a large customer bases in countries such as India and China. Moreover, the beverage manufacturers in the region are introducing zero and low alcohol beverages as the consumers are demanding for low-calorie, low-sugar and healthier beverages.
Europe is witnessing significant growth in the market as the consumers are demanding for alternatives to traditional alcohol beverages. The consumers are opting ways to lower their alcohol intake that has surged in the demand for low ABV beer in the market & has positively impacted the regional market since past few years. Further, the countries Germany and Spain are the largest markets for low alcohol beverages in Europe accounting for 81% of the total share in 2018. These markets mainly driven by the healthier trends and higher number of new product developments along with creative marketing strategies.
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