THE ZONE

WORLD OF WELLBEING
nightcap are a core market for them.
None know this better than Seedlip,
whose ‘messaging’ is about inclusivity
more than anything else. “Our collective
intention is to ensure that everyone has
a seat at the table, and we do that with
an elevated, adult, non-alcoholic option
made widely available,” said a Seedlip rep.
In the way Meatless Monday
introduced eaters to plant plates, Dry
January advances this category. And an
advantageous point of difference for the
NA beverage category is that you can sell
29%
of 16 to 24-year-olds
were non-drinkers in
2015; 29 per cent up from
18 per cent in 2005.
and buy non-alcoholic beverages online
and they can be shipped directly to your
door. Not only is there a zero ask of
behaviour change at a bar or restaurant,
but the NA category is also making your
life significantly easier with familiar
e-commerce experiences.
Another signal to consider is the ‘who’
behind this movement. In the run-up
to the plant-based meat substitutes
explosion, we saw the world’s wealthiest
backing leading brands: Bill Gates and
Richard Branson invested in Memphis
Meats; Li Ka-shing, one of Asia’s richest
men, invested in Modern Meadow;
Twitter co-founder Evan Williams holds
a $414 million stake in BYND; Prince
Khaled bin Alwaleed of Saudi Arabia, a
loud and proud vegan for the past five
years, has invested in Bahrain's Plant
Cafe. Even the Canadian government
invested in BYND. Outside of individuals,
the largest incumbents of the meat
industry, Tyson and Cargill, began
creating their own plant-based brands.
The investments are beginning in
the NA space. In early 2020, Athletic
Brewing Company closed a $17.5 million
Series-B round with backing from both
individuals and venture capital firms,
including Timothy Barakett, TOMS
Shoes founder Blake Mycoskie, Darren
Rovell’s Tastemaker Capital Partners, and
Wheelhouse Partners. Across the menu,
Seedlip, the privately held non-alcoholic
spirit, received funding from Diageo,
the world’s second-largest distiller. Even
alcohol’s Tyson and Cargill equivalents,
Budweiser and Heineken, are producing
non-alcoholic options.
Some may see all this excitement as
pressure, but there is the opportunity to
learn from past mistakes and avoid being
a bust and ring that bell. We learned
with the disappointment of Segway
in Adam Grant’s book, Originals: How
Non-Conformists Move The World, that the
hype we should pay attention to shouldn’t
come from investors, but consumers.
The revolution has the endorsement of
major backers, but this isn’t Steve Jobs
or Jeff Bezos telling Dean Kamen that
his product is revolutionary, these are
customers waving their hands saying, “I
f**king love this.”
The failure to listen to customers was
a major mistake of Segway’s Kamen. As
Grant writes: “One of the biggest mistakes
was that, when building Segway, Kamen’s
team generated a wide number of ideas,
but didn’t have enough critical input from
customers to make the right choices for
the final product.” To understand the
consumer, I joined a Facebook group
that has more than 3,000 members and
30+ posts daily reviewing beers. I quickly
learned that, yes, the consumer is driving
this revolution. So much so, Athletic
Brewing Company had to open a second
brewery to meet demand.
All of these actions and signals are to
determine the path forward. In a 2019
piece, Michael Kealy, education coach at
TD Ameritrade, expressed caution about
the NA category saying: “Fads do come
and go.” Kealy is right about fads being a
wave in the ocean, but incorrect to call the
non-alcoholic revolution a fad. It’s a tide.
It’s a trend. There is a clear growth pattern
in the category and consumers continue
to vote in favour of it.
The modern adult
To best understand this category, I asked
several of its leaders to provide me with
the street-level experience. Athletic
Brewing Company founder Bill Shufelt
and head brewer John Walker developed
a proprietary fermentation process to
remove alcohol from their brew, which
no other producer of NA beer has
done. Their Run Wild IPA won gold in
the non-alcoholic category at the 2018
International Beer Challenge, and it was
named the best US non-alcoholic beer in
the World Beer Awards in 2018.
On the ground level is where Athletic
experiences this revolution most. “Right
now, we’re up more than 500 per cent
tracking where we were last year, but a
lot of last year was dictated by really tight
capacity,” Shufelt said of sales through the
first two months of 2020. An issue solved
with its San Diego brewery.
Athletic’s growth is consistent with
the entire category which, according to
market research firm IRI, saw off-premise
dollar sales of non-alcoholic beer offerings
having increased 43 per cent to $21.9
million, year-to-date to 23 February.
Over the last 52 weeks, dollar sales
of those offerings are up 28 per cent to
$138.5 million.
A learning I took from the conversation
with Bill Shufelt was how inviting the
category is. “We’ve always tried to urge
people to drink less from the positive
side, using motivating, aspirational, and
inclusive language,” he says. “We try to
include drinkers and non-drinkers alike.
Rather than alienate others with outdated
language, we have the opportunity to
invite them in and try our beer. Beer for
the modern adult.”
People are accepting Athletic’s
invitation too. The non-alcoholic beer
segment is growing at a 44 per cent clip
“ A wellness
explosion made
consumers aware
of what they were
putting into their
bodies. ”
— Jeff Hollander
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