Magazine article Marketing

Low ABVs Reach a New High

Magazine article Marketing

Low ABVs Reach a New High

Article excerpt

Sales of lower-alcohol drinks are rising among health-conscious consumers, but the market is destined to remain niche, writes Jane Bainbridge.

Middle-class drinkers binging on wine; errant youths downing cheap cider on street corners; and drunken clubbers spilling onto the pavement in the early hours - the media loves a story related to Britain's alcohol problem.

The responsible-drinking message has been shouted loud and clear: exceed the recommended units of alcohol a week - 21 for men and 14 for women - and you run the risk of serious and long-term illness. Apart from health concerns, many of us are compelled to reduce our alcohol intake through circumstance - say, pregnancy or acting as a designated driver on a night out, for example.

Yet non-alcoholic options, excluding carbonates and juices, of course, are in limited supply. The leading drinks producers may have lower-alcohol drinks (LADs) in their portfolios, but investment in these brands has not always been forthcoming.

This, however, might change as increasing awareness of the dangers of drinking too much alcohol drives sales in the LADs sector.

In 2008, the retail market for LADs was worth pounds 66m, a rise of 11% on 2006, according to Mintel. Lager, accounting for 81% of volume, is the most popular option in this category, and is where most of the investment and NPD has been focused. Meanwhile, cider sales are on the rise, and some commentators cite lower-alcohol wines as the greatest area of potential growth.

This market encompasses drinks that have been brewed or fermented to have a significantly lower alcohol content than normal. Those with an ABV of less than 0.05% are considered 'alcohol-free', while low-alcohol beers have ABVs between 0.5% and 1.2%.

In the light to mid-strength category, the alcohol content of drinks is higher than that ascribed to LADs, but still less than 2.6% ABV.

As with the wider drinks industry, the balance between on- and off-trade sales has shifted as drinking at home has become more commonplace and the pub trade has dipped. The retail sector has a greater share of LAD sales, helped by the promotion of these lines among the supermarkets.

There was a time when alcohol-free drinks suffered from a poor reputation, with many of those consumers brave enough to try them not willing to repeat the experience. In the early days of the sector, Diageo's Kaliber was practically the only option available to lager drinkers wanting to avoid alcohol. Now Beck's, Cobra and Bavaria all have zero-ABV lagers and are closing in on Kaliber's market share.

Coors went down the mid-strength route in 2006 with its Carling C2 line, and others have followed, such as Beck's Green Lemon in 2007 and Carlsberg Mid-Strength last year. However, it remains a somewhat fledgling market, in which brands are not necessarily easy to position.

The leading low-alcohol wine brands are Eisberg from Germany and Sutter Home Fre from the US. The low-alcohol cider market remains small, although there has been some activity, such as Magners' introduction of a mid-strength variant last year.

Overall, low awareness is an issue for this sector: two-fifths of consumers have never thought of buying a LAD, according to TGI.

Men are more likely than women to alter their drinking habits because of health concerns; TGI data shows there is little uptake of LADs among women. …

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