3 Reasons Why NOLO Category is Thriving
That amounts to a compound annual growth rate (CAGR) of 7.5% in just 5 years.
These figures are interesting, to say the least, especially at a time when the pandemic has engulfed the world, and various sectors have experienced a significant decrease in the sales of their products and services.
If there is one good thing that the pandemic has done, it has increased people's trust in the non-alcoholic drinks category.
Consequently, many leading non-alcoholic brands have experienced double-digit growth in their sales.
We will have a detailed look at such brands, but for now, there is a need to understand what led to this sudden increase?
Why did the pandemic shift the interest of people towards non-alcoholic brands?
Let’s dive into the facts.
3 Reasons for the Growth of NOLO Drinks
While there is an array of reasons for the spike in interest of people towards this category, the following are the most prominent.
1. Same taste without the effects of a hangover
If you can enjoy the same taste as of beer without getting drunk, isn’t it a good deal?
I am sure the answer would be in affirmation.
Now you might be wondering that it is impossible for non-alcoholic beer to have the same taste as its alcoholic counterpart. It doesn't just make sense.
However, over the past many years, non-alcoholic brands have spent aggressively on R&D, and consequently, you can surely taste the beer without the effects of a hangover.
2. Increase in health conscious people
It is a known fact that alcohol weakens the immune system along with causing many other health-related complications.
Therefore, when the pandemic shook the world, people became much more vigilant about what they eat and drink. A glass of alcohol-free drink was the obvious choice.
In the UK, mainly youth are the driving force behind the increase in non-alcohol drinks consumption.
3. Increase in e-commerce activities
Apart from the NOLO category, the pandemic also led to an increase in the e-commerce sector. This was because physical shops were closed and e-commerce offered access to the goods and the convenience of home delivery.
In the US for example, since non-alcoholic drinks were not bound by state regulations regarding alcohol, the industry was fully able to seize the e-commerce opportunity.
Brands were free to list their product on an online store as well as ship them to anywhere around the world.
Brands that witnessed increased sales of non-alcoholic drinks
As mentioned at the start, the year 2020 has been kind on brands that sell non-alcoholic drinks.
This was especially true for American and UK brands where the youth were the first to switch to booze free drinks.
While the pandemic benefitted the entire industry, some brands were better able to cash on the growing trends than others.
1. Athletic Brewing
Athletic Brewing is one of the most renowned names in the industry, and that might be the reason why its non-alcoholic beers are growing at an astounding rate of 400% monthly.
Yes, you read that right!
Due to the unprecedented increase in sales, Athletic opened a new brewery in May 2020 in California. The plan was to expand to the west coast and markets to cater to the hot demand.
Not only that, its brewery in Connecticut crossed its limit. Therefore, Athletic bought Ballast Point brewery in March to increase its production by 150,000.
In other words, Athletic Brewing was quickly able to expand its operations and consequently was one of the biggest beneficiaries.
2. For Bitter For Worse
The brand manufactures ready to drink, alcohol-free cocktails. It is based in Portland, Oregon, and had to quadruple its production to cater to more than 600 people on the waiting list.
3. Surreal Brewing Company
Every New year, Surreal experiences a boom in sales due to the Dry January month as fitness enthusiasts run towards the brand to try one of its non alcoholic drinks.
However, this time things are different for the brand as they saw 85 percent new customers week on week, throughout the past few months, and not just at the start of the year.
4. Curious Elixirs
Curious Elixir offers alcohol-free cocktails via a monthly subscription for its 12 ounce bottled cocktails. The e-commerce brand saw a 600 percent increase for its cocktail club in March.
Just to put things into perspective, Curious witnessed a 300% year on year increase in January.
The sober curious movement is picking up pace
If you think that the non-alcohol movement is a fad and only limited until coronavirus dies, you need to hold your horses!
According to a research report by Million Insights, the alcohol-free market is projected to grow at a Compound Annual Growth Rate (CAGR) of 5.3% from 2019 to 2025.
In other words, the industry will grow to USD 1.6 trillion by 2025. That is massive growth in just 5 years.
At Drink Dry, we were the first to recognize the growing demand of NOLO products in the UAE to cater the ever increasing number of non drinkers.
Hence, we decided to take matters into our own hands and have recently launched the region's first premium non-alcoholic online marketplace.