Whilst both Millennials and Gen Z wine drinkers in the US represent the highest opportunity for both lower and no alcohol wine, their motivations and need states for seeking out these options differ
Lower alcohol and alcohol-free wines are often pushed together in the industry shorthand of “low and no”. Indeed, our latest publication, Opportunities for Low and No-Alcohol Wine in the US Market, does just that. However, this delineation does raise an interesting question: should we be thinking of these product groups as one amorphous category or two separate ones?
There is some evidence to treat them operationally as synonymous. The target consumer for these products looks quite similar – younger (LDA-35 years old) drinkers motivated by the desire to moderate alcohol consumption, stay in control, and keep a lid on their calorie intake.
On the other hand, closer examination of the evidence reveals some nuanced differences between both the appeal of lower alcohol wine products versus the alcohol-free versions, and the nature and needs of target consumers.
More involved and frequent drinkers among younger consumers, typically within the segment Wine Intelligence refers to as Generation Treaters, seem more taken with the idea of lower alcohol wines. This group also tends to skew towards the higher end of the ‘younger’ spectrum – a typical consumer would be an educated Millennial in their 30s and more typically male. As always, the question of what constitutes ‘lower alcohol’ in their minds is moot: it could be a wine-based RTD offering 5% ABV or less, or a wine that has a naturally lower level of alcohol (such as Vinho Verde or some German Rieslings). Whatever the definition, their needs are more extrinsic – that is outwardly focused – wanting to be seen to be taking responsibility for moderating their alcohol consumption, particularly amongst their peer group.
Contrast this with the typical attitude amongst the younger drinkers – LDA-30 year-olds – and members of the Wine Intelligence Portrait group known as Social Newbies. From our interview research around the subject, their motivations are more intrinsic – that is inwardly focused – and as well as being more aligned with the idea of avoiding alcohol altogether at certain occasions, their need state is dominated by control and reducing calorie intake.
Differences aside, two things remain true for both product groups: the lack of availability and concerns about taste of the product are holding back demand for lower and no alcohol wine demand in the US market, with considerable opportunities ahead for these wines, particularly with the younger cohorts of wine drinkers.