Healthier Lifestyles Lead to Decline in Alcohol Sales Across Europe
According to the latest FMCG market analysis by Circana, spending on alcoholic beverages decreased by 0.8% in the UK, France, Germany, Italy, the Netherlands, and Spain. However, low- and no-alcohol alternatives witnessed a significant increase of 7.3%. This shift is attributed to the growing health awareness among consumers, who have more options in the market.
Total non-alcoholic beverage sales rose by 5.4% to €109 billion, while overall beverage sales reached €180 billion. Specific declines in alcoholic drinks include beer, cider, wine, and spirits, which saw drops of 0.9%, 1.2%, 1.5%, and 2.2% respectively. A significant number of shoppers, 43%, including half of those aged 25 to 39, are reducing their alcohol consumption by buying less, delaying purchases, or quitting entirely. Meanwhile, other beverage categories like bottled water, juices, and smoothies are seeing increased consumer interest.
Despite efforts to boost alcohol sales through discounts—41% of beer and 37% of alcoholic beverages were sold on promotion during the year—only 15% of consumers reported purchasing more alcoholic drinks. Ananda Roy, Senior Vice President of Strategic Growth Insights at Circana, stated that alcohol has been on a declining trajectory since the pandemic, and the emergence of alternatives offers more choice for consumers both at home and in social settings.
Younger demographics are leading the shift towards non-alcoholic options. There is no sign that this trend will reverse, as lighter and healthier drinks become a commonplace choice. While acknowledging that this isn't the end for alcohol manufacturers, they are encouraged to innovate with products that appeal to changing consumer preferences, such as those with lower sugar and calorie content.
Circana's data also showed that new beverage products contributed an additional €242 million in sales, with €161 million from dairy drinks alone. Spending on beverages across Europe increased last year, largely driven by a 2.3% rise in average prices. UK beverage sales accounted for €54 billion, 30% of spending in Europe’s biggest markets, even as price increases led to only a 0.5% rise in the volume of sales.
Yoghurt-based drinks, ready-to-drink spirits, and plant-based beverages were among the categories that expanded sales despite higher prices. Specifically, yoghurt-based drinks saw a 12.3% increase, while ready-to-drink spirits and plant-based drinks both grew by 12.9% and 5.2%, respectively. Beverage spending on private label products, which now accounts for 35% of the market, also increased, as these brands gained popularity in categories such as coffee, wine, and dairy drinks.
