The Gen Z is the most sober generation ever! and this might be a concern for alcohol industry!
Alcohol industry might die soon!
The emergence of Generation Z as a consumer demographic has sparked changes in the alcohol industry. This generation is notably more health-conscious and inclined toward exploring new experiences and products. Consequently, there is a growing trend in the market for low and non-alcoholic beverages, as well as alternative alcoholic options that aim to provide unique and innovative flavors.
Market landscape
In the recent consumer expenditure data, it was found that in 2021, Gen Z consumers in the United States spent slightly over 2.2 billion U.S. dollars on alcohol, which was the lowest amount compared to all other age groups. It’s worth noting that many individuals in the Gen Z cohort are still underage, and those who are of legal drinking age are typically new entrants into the workforce with limited purchasing power. Brands and marketers are making strategic investments now, anticipating the future impact of these consumers as they grow into a larger and more influential spending group.
Regarding their alcohol preferences, the majority of Gen Z consumers currently lean towards spirits, although this segment experienced a decline in 2022. Interestingly, Gen Z has one of the lowest shares of alcohol consumption in the spirits category compared to other age groups in the United States. Notably, Gen Z individuals are prominent consumers of ready-to-drink alcoholic beverages and constitute the largest portion of cider and seltzer buyers in the market.
Gen Z are consuming less alcohol and adopting a healthier lifestyle
Gen Z consumers are generally reducing their alcohol consumption compared to older generations, reflecting their strong focus on health and well-being. In 2022, they emerged as the fastest-growing demographic of non-alcoholic beverage consumers. Among the key reasons cited for their decreased alcohol consumption were health-related motivations, including the desire to avoid hangovers and the long-term health impacts of alcohol consumption. When Gen Z consumers opted for non-alcoholic alternatives instead of alcoholic beverages, their choices were primarily driven by health considerations rather than flavor preferences. As this generation continues to grow and wield more influence, it will be intriguing to observe whether the industry can adapt and provide compelling reasons for them to remain engaged in the market.
Conclusion:
Generation Z’s health-consciousness is reshaping the alcohol industry, with a significant drop in alcohol consumption. In 2022, Gen Z became the fastest-growing group of non-alcoholic beverage consumers, driven by health concerns. Nonetheless, the non-alcoholic beverage sector thrives, boasting $1.6 trillion in global sales in 2021. Innovative products like non-alcoholic beer and craft mocktails are flourishing, alongside popular ready-to-drink options such as flavored water and seltzers. This trend reflects a growing consumer focus on wellness, setting the stage for further growth and innovation in the non-alcoholic beverage market.
