How big will the non-alcoholic wine sector get?

Globally, the non-alcoholic segment topped $11 billion in value last year (according to the IWSR) and is now the fastest-growing part of the drinks industry. Yet the lion's share of the boom is in NOLO beer, spirits and cider, leaving wine with more 'fragmented growth'.

We're already seeing that fragmentation in action, with many prominent winemakers still trying to get their NOLO wines right, while early adopters - like Giesen, who have a dedicated non-alc winery (you can read our interview with Giesen Chief Winemaker Duncan Shouler for all the insights here) - are now leading the sales race.

But what if there was a way for the wine industry to borrow from other categories to supercharge this growth? What if innovative products (and packaging) could help wine tap into the NOLO boom?

Welcome to non alcoholic wine 2.0, where the idea of what a drink 'should' be isn't restricted to de-alcoholised fermented grape juice in a glass bottle.

Even more interesting is the 'why' behind a shift to less traditional ideas for non-alcoholic wine - and it starts with demographics.

It might surprise many people to hear, but IWSR research notes that wine consumers are trending younger, with millennials and Gen-z making up to 45% of the wine-drinking population (up 6%) post-COVID. Of course, they're US figures, but here in Australia, it's an even more pronounced long-term shift to millennials and gen X, as this graph from Wine Intelligence (from this article) shows:

It should be said that the biggest spenders in the wine industry continue to be the Baby Boomers (as this article in The Shout dives into), but the trend is still younger overall. And when catering for younger audiences, we see very different ways they interact with alcohol compared to previous generations, with IWSR data suggesting these drinkers are:

1. Less aware of familiar names (like wine regions or varieties) and more inclined to explore.
2. More interested in NOLO wines, moderation in general and drinks that are 'better for you'.
3. They're also more aware and open to different packaging. Cans, pouches, and mini-casks are all accepted for 'on the go' drinking occasions.

For any producers keen to tap into the needs of this audience, the appeal of non-alcoholic wines in non-traditional RTD packaging is hard to resist. But given it's still such a developing trend, where to start?

We've already seen clever ways to tap this market with alcoholic wines. Witness these Delinquente cans.

Locally, one of the strongest categories for younger drinkers is minimal intervention wines, with lo-fi pet nats, natural wines, and organic products resonating strongly. To see a preservative-free pet nat in a highly accessible 250ml can is a glimpse of what can be done to attract this age cohort (especially given pet nats increasingly mainstream appeal).

From pet nats, the next stepping point for any lo-fi drinker looking for a sober switch is the innovative Ghiddy Pet-Not. Made in Marrickville, in Sydney's inner west, it comes via Tom Egan (From Jed Wines), Tim Triggs (ALTD) & Thor Bergguist (PS Soda). The crew have used their drinks might to create a sparkling 'wine alternate' inspired by crisp, tart pet nats, yet based on peach, tea, grapefruit, sage and sea salt.

Or, to take the concept another step further, enter the Dayse Glimmer. Here, founders Jack Freestone & Alana Blanchard have teamed up with Organica Beverage Co to craft a 'functional spritz' - a non-alcoholic range of drinks that incorporate nootropics and adaptogens to give a buzz without the hangover.

With the Dayse Glimmer, the team have created a non-alc sparkling wine alternate based around rose and hibiscus with L-Theanine, Ashwagandha & Brahmi to help promote relaxation and ease stress levels.

As Julian Wise from Dayse explains, these are drinks with an edge:

'(Dayse products) are low calorie and have a tailored functional effect, whether that be to boost your mood or help ease your stress and anxiety - that's the beauty of Dayse, we have crafted something that the majority of consumers will love' he said.

'We see Dayse as the future of social drinking'.

The idea of non-alcoholic drinks that pick up some of the alcohol-like buzz is gaining attention too, with even supermodel Bella Hadid among the investors for a non-alcohol drink called High Rhode that promises to 'conjure captivating conversation and release contagious energy'.

Finally, while products like Glimmer or Pet-Not might pull drinkers from traditional RTD categories, the non-alc range from Canberra's Altina Drinks feels much closer to home for wine consumers.

Here, de-alcoholised wine is used as the base, with an array of botanicals and native ingredients (like Kakadu plum or finger lime) that founder Alan Tse believes gives a 'tasting experience that is nuanced and layered' with richness and complexity.

Altina has also embraced canned options with a range of sparkling wine-based non-alc drinks in tins geared towards younger drinkers.

Perhaps the only question is, do these non-alc wines - and wine-like drinks - actually sell?

A glance at Kaddy Marketplace stats gives some insight, and the numbers are astonishing. In just six months (comparing Jan-Feb 2023 to July-August 2022 sales data), the volume is up 101%. Sure, it's coming off a relatively low base - dwarfed by the volume of non-alcoholic beer, but it's difficult to argue with the figures.

The leading SKUs include the Dayse Glimmer, Altina's Sansgria, and the Señorio De La Tautila - a well-priced non-alcohol Spanish Tempranillo.

As for the future of non-alc wines? Well, it may be fragmented, but there is a vast growth potential, and plenty of more established winemakers are being left behind given this new non alcoholic wine 2.0 wave.

To put it best, we'll leave it to the chairman of the first-ever zero-alcohol wine show, Angus Hughson (who penned this excellent article about non-alcohol wine last year).

'The wine industry, particularly its most prominent players, can not afford to ignore the low and zero-alcohol market segments.'

'Now is the time for low-alcohol wine!'.