Florence Welch of “Florence & The Machines” sings in the song “Moderation,” “Want me to love you in moderation/Do I look moderate to you?” The British songstress illustrates a person confronting an indifferent partner. Although romantics might not be interested in engaging with a moderate admirer, consumers increasingly are embracing moderation in their beverage alcohol consumption, prompting a movement in the non-alcohol (NA) beer market.

“Moderation driven by consumer well-being goals are driving growth in non-alcoholic beer,” says Christal Torres, senior manager of client insights at Chicago-based Circana. “Consumers are aligning their food and beverage choices to well-being goals, including weight loss as one of the top cited goals in a Circana March 2024 survey.

“When asked why consumers are drinking less alcohol in an April 2024 survey by Circana partner CivicScience, respondents most often cited their reason to improve physical health,” she continues. “As glucagon-like peptide-1 (GLP-1) usage is expected to continue to grow for weight control, the beverage alcohol category could see more weight-control-related sales declines as GLP-1 households spend less on the category.”

Brian Sudano, CEO at S&D Insights LLC, Norwalk, Conn., also calls attention to lifestyle choices and diet medications influencing the alcohol-free beer category.

“The movement to reduce alcohol consumption facilitated by lifestyle, diet drugs and anti-alcohol interest groups,” he says. “This coupled with improved delivery of higher quality NA beer alternatives have driven rapid growth of NA beer.”

This improvement in quality for non-alcohol beer has found a way to appeal to a diverse consumer demographic.

“The appeal is greatest among a bifurcated consumer group skewing toward lower drinking levels with Gen Z and over 55 which, combined with diet drugs, are getting medical advice to reduce alcohol consumption,” Sudano says.

Top non-alcohol beers (Brand family)

*Includes brands not listed.
Source: Circana, Chicago. Total U.S. multi-outlets (grocery, drug, mass
merchandisers, convenience, military commissaries, and select club and dollar
retail chains) for the 52 weeks ending Jan. 26, 2025.

Ryan Toenies, senior director of client insights at Circana, further adds that NA beer consumers skew white, higher income, white collar/retired and being from the baby boomer generation. However, these skews are not the only makeup for the segment, he notes, adding that younger legal drinking age consumers also participate in the category.

Toenies elaborates that beyond demographics, non-alcoholic beer appeals to both non-beer and beer consumers.

“While the segment brings consumers in that don’t drink the category otherwise, it is helping retain consumers that are aging out or slowing consumption for health reasons,” he says.

Despite the growth and opportunity, non-alcoholic beer still has challenges to face, particularly from other NA versions of traditional beverage alcohol.

“In the short term, NA beer has a lot of runway,” S&D Insights’ Sudano says. “However, over time NA cocktail offerings and NA wine blends will interact with NA beer similar to [flavored malt beverages] (FMBs) and [ready-to-drink] (RTD) cocktails.”

Additionally, Circana’s Toenies cautions that as more brands enter the market, distribution accessibility will be more challenged.

“As entrants continue to come into the space it will become more difficult for brewers to get distribution,” he says. “Currently the segment is a 1.0 dollar share of beer, but a 2.4 share of items in distribution already. The question will be how much space will retailers be willing to give the segment?”

However, S&D Insights’ Sudano compares the U.S. market’s reach to European counterparts and thinks opportunities still exist for the segment to grow.

“Although NA beer has performed well over the past few years, it remains significantly smaller than in Europe,” he says. “As more brands expand availability along with greater distribution by market leaders, we expect the category to continue growing at double digits in 2025.”

Circana’s Torres also anticipates strong performance for the category and its key players this year.

“We’re guaranteed to see the non-alcoholic segment continue to evolve in the new year, especially with the new innovation in Q4 2024 such as Bero by Tom Holland, Firestone Walker 805 NA Blonde Ale, Patagonia Provisions x Deschutes Brewery Kernza Golden Brew, and January 2025 new launches like Michelob Ultra Zero and Mash Gang Tropical Cerveza, Mango IPA and Cherry Stout,” she concludes.