According to the firm’s analysis, the top 10 markets, which comprise 75% of the global consumption of these beverages, are Australia, Brazil, Canada, France, Germany, Japan, South Africa, Spain, the UK and the U.S.

“What we’re seeing is a moderation trend that’s sweeping across key global markets, and that’s bringing with it increased demand for reduced alcohol, or alcohol-free drinks,” says Mark Meek, CEO of IWSR in a press release.

However, demand for these beverages is not new and has been growing for the past several years. In fact, sober-curious consumers have become such a driving force in the market that a multitude of firms, particularly beer brewers, have opted to innovate and deliver alternatives to traditional brews. Heineken has its 0.0 brand, A-B InBev is committed to making no- and low-alcohol drinks 20% of its worldwide production by 2025, and Boston Beer recently launched a nonalcoholic IPA.

Outside of beer, there has also been plenty of innovation, including low-alcohol ciders and spirit-free liquors like Seedlip and Ritual. However, beer and cider are responsible for the majority of the growth in the category, commanding a 92% share of the total no- and low-alcohol segment.

Within low- and no-alcohol beer, Germany is the largest and most developed market followed by Spain, making up 11.8% and 10.6% of the total beer category respectively. Due to the largely developed nature of these areas, during 2020, these territories experienced marginal growth as compared to the U.S. wher these beverages are still catching on. ISWR called the U.S. the “most dynamic” market, demonstrating this claim through data showing that in 2020, the no and low segment registering over 30% sales growth to reach $1.7 billion in sales. South Africa was another market poised for growth with ISWR predicting it will experience a compound annual growth rate of 16%.

Although no- and low- alcohol alternatives are generally lumped together, they do not stand on equal footing with consumers. Broadly, no-alcohol products are outperforming low-alcohol beverages with ISWR attributing this trend to the increasing popularity of non-alcoholic spirits and RTDs that are particularly resonating with people looking to be mindful of their consumption. From 2019 to 2020, the no-alcohol subcategory increased volume by 4.5%, while low-alcohol decreased by 5.5%, according to ISWR.

The trend toward moderation will continue to grow in prevalence in the coming years. To help support the category, capture the demand and broaden the appeal of these products, ISWR noted that it is up to brands to increase both the breadth of available offerings as well as render their price points appealing.