It’s Thursday afternoon, and a group of friends are deep in a text exchange on where to meet after work. One friend doesn’t want to drink tonight because they have an early meeting the next morning, but they still want to socialize. Each friend has 10 tabs open on their browser, scouring cocktail menus until they find a bar serving delicious nonalcoholic beverages alongside the alcoholic options. The bar quickly becomes their favorite place for happy hour and brunch. A version of this scenario is playing out regularly. Over ⅓ of drinking-age adults don’t drink alcohol at all (sober), and more than 50 percent of those who do drink also drink nonalcoholic beverages (sober-curious, taking a night or week off, pregnant, on medication). It’s time to rethink what you’re selling on-premise. Here are four business reasons why it's essential for the alcohol industry to embrace this opportunity.
Catering to Changing Consumer Preferences. Incorporating non-alcoholic beverages into your menu ensures you can cater to evolving consumer preferences. Led by wellness and health-conscious lifestyles, the nonalcoholic beverage market is growing at a rate of 20 percent annually. Why can’t these consumers just drink water? Ask an industry leader.
“When I managed beverage programs, I adamantly rejected stocking non-alcoholic beer or featuring non-alcoholic cocktails on the menu. Like many bar managers, I couldn't comprehend why anyone would choose such drinks, so I disregarded them. I used to think, as many do, 'Why can't they just have water, tea, or soda?' It wasn't until I stopped drinking that I grasped the significance. Abstaining from alcohol shouldn't exclude someone from enjoying a sophisticated, adult beverage. Just as we accommodate people with veggie burgers or gluten-free buns, why do we still turn our noses at those who don't drink but desire inclusivity? Since I stopped drinking, I actively support bars and restaurants that offer high-quality NA options. Not only do I frequent them repeatedly, but I also bring groups along. Providing NA choices doesn't merely result in occasional sales; it means attracting entire parties who wouldn't have chosen your establishment without those inclusive drink options,” says Ian Blessing, Co-Founder and Owner of All The Bitter, alcohol-free bitters
By embracing this trend, on-premise establishments can position themselves as innovative and in tune with the latest consumer demands, attracting a broader audience and benefiting from positive brand exposure through influencers and digital marketing.
Expanding Revenue Streams. By offering non-alcoholic beverages, on-premise establishments can tap into new revenue streams and attract customers who might have yet to visit your establishment. But, you might think, ‘Nonalcoholic beverages currently account for less than 2 percent of my sales.’ However, according to Ed Carino, co-founder of ProofNoMore, New York’s first nonalcoholic distributor, “If you offered quality NA drink options, you can actually make more money versus just serving them water, fruit juice, iced tea, soda where the profit from NA drinks is more.” June Nicholson, Co-founder of Liquid44 Beverages and nonalcoholic beverage strategist, adds, “Stop leaving money on the table by not offering a range of creative beverages that can sit beside the alcoholic offerings. Nonalcoholic beverages, well done, command a premium.” Customers are clamoring for options beyond tea and water. A nonalcoholic cocktail is not simply the virgin version of a margarita. It is a well-crafted beverage, usually including a nonalcoholic spirit, that appeals to the adult palate. Don’t miss an opportunity to diversify your menu to include nonalcoholic options that can help offset any potential decline in alcohol sales and provide a financial cushion during changing market dynamics.
Enhancing Customer Experience. Carino says bars and restaurants are “in the business of offering space where people can congregate and enjoy themselves that happens to have food and drinks, so excluding someone who doesn’t drink or is moderating makes that person feel left out.” Adding non-alcoholic beverages to the menu elevates the overall customer experience. It ensures patrons have a wider range of choices to suit their preferences, making them more likely to stay longer and spend more at the establishment. Customers who opt for non-alcoholic options can still enjoy socializing and engaging in the vibrant atmosphere without compromising their personal lifestyle choices.
Encouraging Responsible Drinking. Providing an array of enticing non-alcoholic beverages promotes responsible drinking habits. You can create a more inclusive and safe drinking environment by offering appealing alternatives. This proactive approach fosters positive relationships with customers, the community, and regulatory authorities, ensuring the long-term sustainability of your establishment.
In conclusion, adding non-alcoholic beverages to your menu is a sound business decision. From accommodating evolving consumer preferences to expanding revenue streams and fostering a responsible drinking culture, embracing non-alcoholic options presents a compelling opportunity for the alcohol industry to remain competitive, increase customer satisfaction, and drive long-term success.
First published in Pr%f the Magazine, Volume 3, July 2023, page 58