Demand for zero-proof spirits is at an all-time high, buoyed by a new approach that ditches the all-or-nothing drinking mentality and encourages people to embrace alcohol-free spirits on their own terms. For some, that means mixing zero-proof spirits with other non-alcohol ingredients to create upscale alcohol-free cocktails. But for others, zero-proof spirits are a good accompaniment to traditional spirits and provide a lower-alcohol twist for well-known drinks. Gone are the days of a simple abstinence-fueled message. Today, non-alcohol spirits offer their own stylish twist on imbibing.
The alcohol-free spirits segment has been showing strong growth, albeit from a small base, as major alcohol players invest in the trend. Sales of zero-proof spirits were up 90% in 2022, totaling $6.1 million, according to Impact Databank, with depletions up more than 100% to nearly 22,000 9-liter cases. “It’s an incredibly exciting time to be in the non-alcohol space,” says Marcus Sakey, co-founder of Ritual Zero Proof, which counts Diageo as a stakeholder. “We believe the inflection point is right now. The last few years have given us time to prove it’s not a blip.”
Diageo’s Distill Ventures arm acquired its stake in Ritual Zero Proof in 2020. The brand currently offers four expressions: Tequila Alternative, Rum Alternative, Whiskey Alternative, and Gin Alternative (each $30 a 750-ml.). Sakey calls Ritual Zero Proof the non-alcohol spirits category’s captain, and claims market leadership. He likens non-alcohol spirits to the dairy- and meat-alternative sectors of the grocery industry, which were slow to gain traction but now have a presence in nearly every grocery store in the country. “We’re performing well with every demographic, from Gen Z to Baby Boomers,” Sakey adds. “Our take is that it’s not about having less of anything, but about having whatever you want. It’s optionality. Our goal is to put another tool in people’s cocktail kit.” Ritual Zero Proof is selling well in Texas and California, as well as Wisconsin, Michigan, and New York. Tequila Alternative is the brand’s top-seller, followed closely by Whiskey Alternative.
The Alternative line first got its footing in the off-premise—mega chain Total Wine & More was an early partner—due to the Covid-19 pandemic’s impact on restaurants and bars, but Sakey adds that Ritual Zero Proof is now focusing on the on-premise to gain further ground. “Ritual is designed to be used in cocktails,” he says. “We took the flavors you associate with alcohol—the nose and bite—and worked with distillers to build them into our recipes. Mixed into a cocktail, they’ll fool you. Seeing non-alcohol spirits in cocktails and bars is really important for public awareness.”
Zero-proof spirits always start the year on a high note, benefiting from the Dry January movement. Sakey estimates that Ritual Zero Proof sold one bottle a minute for the entirety of January 2022, and says this year the company expects to sell two a minute. Indeed, Dry January and its recent counterpart Sober October have helped create awareness for the entire zero-proof sector. Seedlip is a relative elder statesman among zero-proof spirits, having launched in the U.S. in 2015; Diageo’s Distill Ventures purchased a majority stake in the brand 2019. But Seedlip takes a different approach to non-alcohol spirits, offering a portfolio of products based on natural herbal and botanical ingredients that doesn’t emulate existing spirits options.
“Seedlip is a genuinely new-to-world product and flavor profile,” says Nicholas Rowland, Seedlip’s senior marketing manager. General awareness of the top non-alcohol spirits brands tends to be low, but consumer interest is high, Seedlip has secured listings at some of the country’s best bars, restaurants, hotels, and retailers. The portfolio includes three labels: the herbal offering Garden 108, the citrus-influenced Grove 42, and the warm and bitter Spice 94 (each $32 a 750-ml.). Rowland estimates that dollar sales for the brand were up by roughly 70% in 2022, noting that Seedlip’s top markets include New York, California, Illinois, Texas, and Florida. “Our consumers are both suburban and urban, but still have a high interaction with the overall spirits category,” Rowland adds. “Seedlip has changed the social scene and reinvented cocktail culture. The on-premise is critical for driving trial and allows people to feel included in social drinking occasions.” He adds that Seedlip also does well through e-commerce purchasing platforms.
Along with new entrants, established alcohol brands are exploring non-alcohol offshoots in a bid to boost their portfolios. In early 2022, Martini & Rossi, which is owned by Bacardi, launched the alcohol-free aperitivos Floreale and Vibrante (each $20 a 750-ml.), which North American brand ambassador Fabio Raffaelli says have been well-received in their first year. “The non-alcohol and low-abv market has performed extremely well over the past year, largely driven by increased popularity in the overall health and wellness movement,” he says. “Martini & Rossi is known for vermouths, but initial rollout of our non-alcohol offerings has been quite successful.” At press time, Floreale and Vibrante’s full national rollout was due to be completed in time for this year’s Dry January, and Raffaelli adds that Dry January and Sober October have definitely played key roles in furthering the rapid growth of alcohol-free spirits.
Martini & Rossi Floreale has a floral taste complemented by chamomile, while Vibrante offers full-flavored fruit with notes of Italian bergamot oranges. The spirits are doing well in California—particularly in San Francisco and Los Angeles—where growth has been driven by the on-premise. Bars and restaurant are swapping Vibrante in for bitters in Negronis and using both expressions in non-alcohol Spritz cocktails.
Spirits industry veteran Jim Clerkin—formerly of Diageo, Moët Hennessy, and Beam Suntory—has also gotten in on the zero-proof beverage trend with his new venture, Demeter & Co., which partnered with U.K.-based CleanCo in 2021. The brand offers four zero-proof spirits labels: the gin alternative Clean G, the Tequila alternative Clean T, the vodka alternative Clean V, and the rum alternative Clean R (each $30 a 750-ml.). The portfolio is sold nationwide and is doing well in major markets like New York City, Los Angeles, and Miami. “There’s definitely an increased interest and desire for clean drinking that still allows for social interaction, and we’re excited to be a part of it,” says CEO Billy Paretti. “The category is still new, but it’s already shown incredible growth and popularity in the United States.”
Spiritless was launched in 2019 by a team of women with beverage industry experience, and the brand is showing strong growth for its flagship product, Kentucky 74 ($36 a 750-ml.), a zero-proof Bourbon-inspired spirit. The brand also has a cinnamon portfoliomate called Kentucky 74 Spiced ($36), which is currently sold out, and the Tequila-inspired Jalisco 55 ($38 a 700-ml.), as well as a couple pre-mixed RTDs that have 0.5% abv ($16 a 4-pack of 250-ml. cans). Spiritless targets millennial consumers.
“On-premise is the perfect atmosphere to drive trial and exploration, which benefits the off-premise,” says Spiritless CEO and cofounder Lauren Chitwood. “Right now, we view non-alcohol spirits as a sidekick to traditional alcohol, not a full replacement. Having a non-alcohol option in your store or on your menu enhances the experience. We’re just about to reach the tipping point for this category. We’ve always maintained that mass retailers leaning into non-alcohol spirits would be the signal that we’ve officially arrived, and in 2023 we’re going to see exactly that.” Born in Australia and brought to the United States in 2019, Lyre’s has a varied non-alcohol portfolio that spans from American Malt and Highland Malt whisk(e)y-inspired spirits to Dry London, Agave Blanco, and White Cane labels (each label is $36 a 700-ml.). The Lyre’s brand includes 18 non-alcohol spirits offerings, as well as a handful of zero-proof RTDs. It’s now sold in 80 countries around the globe, with its strongest U.S. markets including Arizona, California, Florida, Massachusetts, New York, Oregon, and Washington.
“The world of non-alcohol spirits is one of the fastest-growing, and we’re continuing to see awareness grow alongside sales,” says Joshua Carlos, Lyre’s senior vice president of North America. Carlos notes that in both the on- and off-premise, non-alcohol products are seeing greater penetration in higher-end accounts. For the on-premise, he adds that Lyre’s is well-suited for recreating popular cocktails sans alcohol. “Our team is hyper focused on growing the brand,” Carlos says. “Our mission is to change the way the world drinks.”
At The Free Spirits Co., which launched in 2020 with three non-alcohol spirits options, the cultural shift happening across the U.S. is a key driver within the zero-proof segment. Free Spirits founder and CEO Milan Martin says the majority of consumers who purchase non-alcohol labels also buy traditional spirits, and the demographic spans from 21-year-olds up through the oldest drinkers. The Free Spirits Co.’s lineup includes The Spirit of Bourbon, The Spirit of Gin, The Spirit of Tequila, and the recently launched Spirit of Milano, an Italian aperitivo (each is $37 a 750-ml.). The products have no alcohol but do contain B vitamins and amino acids to “elevate mood and energy,” and they do well in the Northeast and along the West Coast, as well as in Texas and Iowa. “This market is a moderation play, not an abstinence play,” Martin says. “More than 80% of those who buy and drink zero-proof spirits still drink alcohol. Now, bartenders and drinkers simply have another tool in their arsenal that allows them to drink as many cocktails as they want, with as much alcohol as they choose. We’re really excited about the future of the space.”
The non-alcohol spirits segment’s most recent entrant, Danish brand Ish, debuted in the U.S. this past October, just in time for holiday parties and Dry January. Founder and CEO Morten Sørensen expects the United States to be the brand’s top market in 2023. The Ish portfolio includes GinISH, RumISH, and Mexican Agave Spirit, a non-alcohol Tequila (each is $35 a 500-ml.). The products are performing well so far in Atlanta, Chicago, and Minneapolis, as well as throughout California and New York, where the brand is focusing on the on-premise. New York City restaurant Eleven Madison Park was Ish’s first U.S. account.
“There have never been so many options for the mindful drinker, and never has the world seen such broad distribution across all channels,” says Sørensen. “The most exciting thing in alcohol right now is alcohol-free. All the major industry players are expanding their non-alcohol portfolios. It’s a trend the industry is betting on.”
Retail And Restaurants
Non-alcohol spirits continue to garner interest at a variety of retail stores, both brick and mortar and online. E-commerce platform Drizly reports that non-alcohol offerings were up 24% in 2022 over the year prior, and Liz Paquette, head of consumer insights at Drizly, notes that zero-proof labels increased by 70% on the website. Drizly conducted a retail study in November that found more than 20% of retailers saw non-alcohol products outperform their expectations in 2022. Brands like Seedlip, Ritual Zero Proof, and Lyre’s are Drizly’s top- sellers in the segment.
Meanwhile, at Concord, California-based chain BevMo, which was purchased by retail delivery company Gopuff in 2020, non-alcohol sales are up 35% year-over-year. The company stocks zero-proof labels next to their traditional counterparts, providing clear signage for the alcohol-free offerings in each section, and is increasing the square footage of its non-alcohol displays to accommodate new brands. In addition, Gopuff has a non-alcohol section within the alcohol section of its mobile app.
The retail market chain Foxtrot, which boasts more than 20 stores in Chicago, Dallas, Washington D.C., Virginia, and Maryland, also saw non-alcohol spirits perform very well in 2022. The company says zero-proof labels were the top-ranked subcategory of spirits by revenue across all stores, making up 20% of sales. The category is also the largest at Foxtrot by SKU count. “Non-alcohol spirits sales are up 73% year-on-year at existing stores,” says Foxtrot’s beverage director, Dylan Melvin. “People who buy non-alcohol spirits at Foxtrot also buy alcohol products, too, which reinforces the narrative that people are just looking to moderate their consumption. Most of the reports I read expect non-alcohol beverages to continue to grow over the next three to five years and beyond.”
Even with all the off-premise success, non-alcohol spirits marketers are putting heavy emphasis on building in the on-premise. Most agree that their products are better-suited to mixing in cocktails over sipping neat—though some do expect zero-proof sipping spirits to be a new offshoot of the category—and they believe bartenders hold the key to continued growth and consumer awareness.
At Mister Mao in New Orleans, head bartender Juan Cardona says that as many as one out of every two tables in the restaurant orders a non-alcohol cocktail. The venue offers its own zero-proof drinks, as well as a couple canned, pre-mixed alcohol-free drinks that can be poured over ice. “We’ve gotten great feedback from our guests, and non-alcohol cocktails are something they’re really intrigued by,” Cardona says. “It’s really grown in the last year and we continue to focus on it.” Mister Mao’s zero-proof cocktails include The Libertad ($10), made with Lyre’s non-alcohol Dark Cane and Italian Spritz spirits, All The Bitter non-alcohol bitters, and rose water, topped with Coke, and the Bubbles Tahoe Recliner ($10), blending Lyre’s Italian Orange spirit with grapefruit and lime juices, topped with soda water.
Miami-based Kush Hospitality Group just recently added its first non-alcohol spirits—Martini & Rossi Floreale and Clean G gin—and beverage director Cristina Suarez says they’re gaining momentum at the company’s restaurants. Kush restaurants have offered the G Naste ($11), made with Martini & Rossi Floreale and Fever Tree tonic, garnished with a dehydrated lemon wheel. “Hopefully this grows and we can expand our non-alcohol spirits,” Suarez says. “It’s rising day by day.”
In New York City, the renowned Gramercy Tavern recently expanded its non-alcohol spirits and beer offerings to keep up with consumer demand. The venue’s bar offers a Scottish Spritz ($16) made with Feragaia zero-proof Scottish spirit and Fever Tree tonic, garnished with an orange wheel, as well as several other zero-proof spritzes. “Non-alcohol spirits and pairings are frequently asked for at Gramercy Tavern,” says beverage director Erin Healy. “It’s an exciting foray for us since we do have demand in this category and it has been received with enthusiasm by our team and our guests. Having a breadth of non-alcohol options that includes spirits is very important.”