Abstract

About this report

Concern over binge drinking and related health issues has revived the market for low-alcohol drinks, boosting sales by 10% in volume and 12% in value to stand since 2006 at 20 million litres worth £66 million in 2008.

Lager dominates, buoyed by investment in new lower and mid-strength variants, but cider sales are finally moving forward and wine is said to offer greatest potential.

Key report themes:

• What impact are the Government' s responsible drinking strategy and the anti-binge drinking lobby having on the low alcohol drinks category?
• Which soft drinks categories offer greatest competition to low alcohol drinks?
• Which sub-categories are attracting greatest investment in innovation and marketing?
• Is the current category growth forecast to continue.

Table of Contents

• Issues in the MarketKey themes
• Definition
• Abbreviations
• Market in Brief
• A growing market
• Lager leads in sales, NPD investment
• Nation becomes more ' drink aware'
• Innovation and marketing propel category forward
• Sales shift towards retail, but on-trade value is needed
• Market opportunities
• Further investment key to future growth
• Internal Market Environment
• Key points
• British public heeds health message
  • Figure 1: Trends for alcohol consumption and frequency generally, at home and elsewhere, 2004-08
• Binge-drinking backlash also hits home
• Increase in incidents associated with drinking and driving in 2007
  • Figure 2: Number of licensed vehicles on UK roads, 2003-07
• Low alcohol gains in cachet?
• Consumers are less experimental
  • Figure 3: Trends in attitudes towards alcohol, 2004-08
• Broader Market Environment
• Key points
• Other European markets more receptive to LADs
  • Figure 4: European comparison of alcohol and low alcohol beer consumption, 2008
• Legislative issues
• Government and industry tackle alcohol abuse
• Labelling legislation highlights ABV
• The smoking ban and evolving pub culture
• ABV-linked tax proposals could benefit low alcohol category
  • Figure 5: Alcohol taxation rates applied in the UK from December 1, 2008
• EU ruling may boost profile of low-alcohol wines
• Ageing population poses a challenge
  • Figure 6: Structure of the UK population, by age and gender, 2003-13
• Recent unemployment increases bad news for LADs
• Competitive Context
• Key points
  • Figure 7: Market size and growth for premium (adult) soft drinks, carbonates and fruit juice and juice drinks, 2003-07
• Premium soft drinks
• Wine-based adult soft drinks
• Carbonates
• Fruit juice and juice drinks
• Strengths and Weaknesses in the Market
• Strengths
• Weaknesses
• Market Size and Forecast
• Key points
• LADs leave alcoholic drink doldrums behind
  • Figure 10: UK volume sales of LADs as percentage of total sales, by sector, 2007
  • Figure 11: UK retail value and volume sales of low-alcohol drinks, 2003-13
• LADs emerge as a trend in 2007
• Potential emerges in wine and cider categories
  • Figure 12: UK retail value and volume sales of low-alcohol and alcohol-free drinks, by sector, 2004-08
• The future of the market
• Forecast
• Beer is behind steady market growth
• Factors used in the forecast
• Segment Performance
• Key points
• New entrants propel beer sales
  • Figure 13: UK retail value sales of low-alcohol and alcohol-free beer, 2003-13
  • Figure 14: UK retail volume sales of low-alcohol and alcohol-free beer, 2003-13
• Capturing the middle ground
• Consistent retail growth for low ABV wines
  • Figure 15: UK retail value sales of low-alcohol and alcohol-free wine*, 2003-13
  • Figure 16: UK retail volume sales of low-alcohol and alcohol-free wine*, 2003-13
• Low-alcohol variants jump on the cider bandwagon
  • Figure 17: UK retail value sales of mid-strength, low-alcohol and alcohol-free cider, 2003-13
  • Figure 18: UK retail volume sales of mid-strenghth, low-alcohol and alcohol-free cider, 2003-13
• Market Share
• Key points
• Competition heats up over Kaliber' s eroding share
  • Figure 19: Brand shares in low-alcohol and alcohol-free beer, by volume, 2004-08
• Top two lead wine sales
  • Figure 20: Brand shares in low-alcohol and alcohol-free wine, by volume, 2004-08
• Companies and Products
• Adnams
• Bavaria
• Carlsberg UK
• Chalié RichardsCobra
• Coors Brewers
• C&C Group
• Diageo
• Harveys
• InBev UK
• Kopparberg
• LoNo Drinks Company
• PLB
• Surfax
• Weston' s
• Brand Communication and Promotion
• Key points
• Mid-strength lager entrant buoys total spend
  • Figure 21: Main monitored media advertising spend on low/no alcohol beer & lager, 2004-08
• Adspend by advertiser
  • Figure 22: Main monitored media advertising spend on mid-strength, low/no alcohol beer and lager, by advertiser, 2004-08
• Carling C2
• Cobra Zero%
• Bavaria Alcohol Free
• Clausthaler
• Responsible drinking campaigns
• Channels to Market
• Key points
• Slide continues in favour of off-trade sales
  • Figure 23: UK retail volume sales of low-alcohol and alcohol-free drinks, by outlet type, 2006-08
• LADs hit by pub downturn
• Buoyant supermarket sales lead category growth
• The Consumer -- Usage
• Key points
• Making LADs a part of a young man' s night out
• Encouraging taste trials of new LADs
• Who currently drinks LADs?
• Frequency of drinking
  • Figure 24: Frequency of drinking low-alcohol beer or lager (cans or bottles), 2004-08
  • Figure 25: Consumption of low alcoholic drinks, October 2008
• Older consumers and women reject LADs
• Men most receptive
• Poor past experiences a turn-off
• Enticing newcomers to the category
• Appendix
• Consumer research
• ACORN
• Advertising data
• Abbreviations
• Appendix -- Internal Market Environment
  • Figure 30: Trends for not drinking alcohol by gender, 2004-08
  • Figure 31: Attitudes towards alcohol, by demographic sub-group, 2007
• Appendix -- The Consumer Usage
  • Figure 32: Consumption of low-alcoholc drinks, by demographic sub-group, October 2008
  • Figure 33: Consumption (cans or bottles) of low alcohol beer or lager, by demographic sub-group, 2007
  • Figure 34: Consumption (cans or bottles) of low alcohol beer or lager, by demographic sub-group, 2007