2024: Mid Year Deep Dive Into Non-Alc Category Data:
As we pass the halfway mark of 2024, I thought it would be a good time to do a deep dive on the non-alc category, focusing on both Off & On Premise data.
Off Premise:
YTD Total US Off Premise Sales: $423M up 30.4% YoY
(Could it break $1B with a strong second half?)
Sub Category Breakdown:
Non-alc beer makes up 81% of the market and, from Gruvi’s perspective, it’s great to see craft surpass domestic as the largest non-alc sub category representing 28% of the market. All subcategories grew but looking at velocity trends, I think it’s safe to project that craft will be the dominant leader with both the highest growth rate and velocity increases for non-alc beer. We should expect non-alc imports to surpass the domestic brands by year end.
YoY velocity change data allows us to see what consumers are most excited for in the future. Outside of beer, sparkling NA wine and NA cocktail RTDs are growing quickly with strong increases in YoY velocity. However, it looks like consumers aren’t that excited about non-alc hard seltzers and hop waters. Non-alc hard seltzer is dominated by White Claw 0.0 which - full disclosure - I thought had a lot of potential. My reasoning was that if the brand focused solely on the on-premise channel (the opposite of what they did with their alcoholic products) for the first few years, they could capture significant market share. Very curious to see if they can course-correct.
Craft NA Beer Breakdown:
Looking more deeply into the data for just craft non-alc beers, no major surprises. The best selling styles are IPA and Hazy IPA with 56% of the market. We did see a big jump in Wit/Belgian Wheat sales on the back of the Blue Moon Non-Alc rollout. The velocity data shows us that consumers are very interested in seasonal NA beers & limited releases. The average price for craft NA beer is $11.95USD per 6 pack (6x12oz.)
From a package size perspective, 6pk and 12pk are the dominant format sizes. Although the data doesn’t show it, I’d keep my eye on the growth of singles in the non-alc space. With Gruvi’s large focus on venues, I know we’re ready to jump at the 19.2 oz NA beers if we start to see some love there.
Non-Alc Wine Data:
As Gruvi is committed to producing affordable single serve non-alc wine, I’m always curious to check the NA wine data around size & price. While the single serve format offers many benefits for Gruvi, one fundamental challenge is that 97% of the market is 750ml. That said, there is definite upside potential with good YoY velocity growth in singles. As we keep educating the on-prem about carrying non-alc wine, we expect the off premise momentum to continue.
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From a pricing standpoint, the market is still being led by $10/750ml bottles, but it also looks like the consumer isn’t scared of premium price points (>$20/750ml.) These are likey two very different consumers.
A key insight for Gruvi is that singles (of $4 -$5) are selling at an extremely high velocity and growing quickly. We likely need to explore merchandising our wines as 4pk as well as singles to maximize consumer interest.
On Premise:
According to NielsenOPM, which tracks the latest trends in US bars and restaurants, total beer sales in the 12 months to mid-May were down 2.9% year-on-year while the no-alcohol beer segment achieved growth of 33.7%.
NIQ’s Client Director, said: “While no-alcohol beer remains a relatively small element of US On Premise drinks sales, it’s one of the most explosive categories for growth. It’s powered by a global trend for moderation in alcohol intake as consumers focus more sharply on their health, and reinforced by the flow of new, distinctive and high-quality alcohol-free products”
Pale lager remains the most popular type with a 55% share of the market, and its sales by value have risen by 8.0% year-on-year, but as the segment matures non-alcoholic IPA’s, stouts and blonde ales are gaining share. Similar to off premise, growth has come from IPAs and blonde or golden ale, where sales have rocketed by 170.9% and 165.5% respectively.
One of the most exciting partnerships that I read about this month was A&W Canada partnering with Labatt Breweries to serve Budweiser Zero, making it the largest Canadian QSR to offer non-alc beer. I’m super curious to see if this is successful as this is truly opening up a new consumption occasion for the category.
Who can connect Gruvi with Shack Shack for a more premium partnership :)
Stay Gruvi,
