Booze control: How convenience stores can tap into the dry January and February movement

Just how hot is this category? According to Gabriel Moreau, vice-president sales at NIQ, “We are seeing 17% in dollar volume growth for these items in the last year. Current data [for last 52 weeks ending November 2] showed it was up 41% in the prior year. This is mostly fuelled by a terrific performance of new low-alc RTD-type products, as well as beer.”

NIQ data shows the non-alcoholic beverage market gained significant momentum between June 2023 and June 2024 with total sales soaring to $199 million—a whopping 24% increase over the previous year. 

The NoLo movement

Various factors are behind the surge. “We know younger demographics are health conscious and are looking to balance their alcohol consumption with alternative products. About 61% of Canadian households purchased them in the last year. Millennials, gen Xs and boomers are also actively pursuing these products. The increased demand has pushed suppliers towards creative innovation.”

The NoLo category is no fad, he notes. “The underlying demand for these types of products is definitely there to stay. In 2025, we could well see another year of double-digit growth for the category, especially if suppliers keep innovating.”

He feels that c-stores would “absolutely” do well with sales of NoLo products, even though they might not be as high as bev-alc sales. “Even a small selection can be highly incremental to overall store sales,” explains Moreau. “Having a few carefully selected listings will allow retailers and store owners to capture some of the growth occurring in the category.” 

Premier Brands president Jeff Dafoe is feeling bullish on the potential of NoLo products in c-stores, too. “Convenience is the channel with the most opportunity to develop,” he says. “While customers have traditionally been less interested in better for you, this trend is changing as we see a variety of options and margins driving growth.”

Premier Brands’ current portfolio of globally sourced beers includes German-made favourites like Bavaria 0.0% Original Malt, Paulaner 0.0% and Clausthaler (Original, Dry Hopped and Lemon SKUs), a brand that pioneered making non-alcoholic beer in the 1970s.

Non-alcoholic beer continues to dominate the NoLo category, accounting for 76% of total sales. It has experienced a growth rate of 23.3%, NIQ reports. And guess who is buying non-alcoholic products? An estimated 75% of those consumers also purchase alcoholic products: A stat convenience stores should consider when stocking shelves.

Brewers are betting heavily on continued growth. Italy’s Peroni Nastro Azzurro will devote 20% of its global portfolio to alcohol-free products by 2030, according to Katie Wright, head of marketing at Asahi Canada, and Erik Preston, the company’s key account manager grocery & convenience.

“We’ve embraced innovation to cater to a diverse, evolving audience,” they say. “To achieve this, we know it’s essential to offer easy-drinking options that align with shifting consumption trends. Recognizing the changing beer landscape, especially among younger generations seeking lower and no ABV options, we offer no and low alcohol options, such as Peroni Nastro Azzurro 0.0%, to meet this demand while maintaining superior taste and premium quality.

EXPERT TIP: To drive retail sales, one strategy they suggest is cross-merchandising Peroni Nastro Azzurro with Italian snacks or premium food items that drive a connection to a food occasion.

Canadian brewers are also jumping into NoLo in a big way, including Muskoka Brewery. “At the core of our values is ensuring that we can offer a beverage for everyone and every occasion,” says Kyra Dietsch, marketing and brand manager. “We strive to be on the edge of innovation and offer beverages that meet the evolving tastes of consumers.”

The time was right for the Ontario brewer to build its roster, including non-alcoholic beers like Veer Lager with Lime, Veer Hazy IPA and Rally Dry Run Pale Ale, as well as its Muskoka Wandr sparkling tea infusions.

“About 86% of consumers are drinking more alcohol-free beverages than last year, most of which aren’t abstainers—just looking to take a more mindful approach with their consumption,” notes Dietsch. “People are reflecting on their relationship with alcoholic beverages and the mindset is changing.” 

EXPERT TIP: Convenience stores can promote these beverages in different ways. “They can highlight non-alcoholic products for social occasions as beverages that are a great addition to an event to moderate alcohol consumption for those partaking, or an inclusive option for those abstaining,” says Gavin Whitehead, the company’s channel marketing manager. “Low/non-alc products can be featured in store as alternative beverages in the better-for-you segment and promoted to those looking for lower calories and sugar options.”

Finding the balance

In the non-alcoholic spirits and RTDs category, sales have grown by 67.7%, as shown by NIQ research. It’s a category gaining traction as consumers seek sophisticated alternatives to traditional alcoholic spirits.

At Collective Arts Brewing in Hamilton, Ont., efforts are ongoing to craft NoLo products for both beer and spirit customers. “Beverage companies, including us, are prioritizing non-alcoholic innovation to keep up with these shifting trends,” says Matt Johnston, CEO and co-founder. “We expect in the next five years to be prioritizing this category at a pace that matches the growth we’re seeing now.”

The beverage company first launched the easy drinking Hazy Pale Ale almost two years ago. The process of perfecting the recipe, using a yeast that doesn’t create alcohol as a byproduct, took about 12 months. It was important to get it right. “Historically, a lot of non-alc beers didn’t taste great, so it was a barrier for the category,” explains Johnston.

Then came a hoppy IPA, lemony Guava Gose and Emerald Stout with roasted notes, rich chocolate and caramel flavours. Zero proof, no calorie cocktails have also become a cornerstone of Collective Arts’ NoLo offerings, with SKUs such as Mellow Mojito, Midday Mule and Perpetual Paloma.

Johnston feels that convenience stores will benefit from stocking non-alcoholic beverages to appeal to a wider range of customers. 

“It reflects a commitment to inclusivity, serving both traditional drinkers and those seeking non-alcoholic options,” he says.  “Additionally, the category’s growth presents an opportunity for differentiation. Stores that embrace this trend can stand out from competitors.”

EXPERT TIP: Beyond traditional marketing tools like window posters and signage, effective category management is crucial. “Creating dedicated sections—such as a designated shelf or aisle for non-alcoholic beer and cocktails—makes it easy for customers to find what they’re looking for,” says Johnston. “It also helps distinguish these products from alcoholic options and prevents confusion.”

For Calgary-based Wild Folk Beverages, the inspiration for creating “free-spirited botanical cocktails” came from a desire by founder Dalia Kohen’s to show that non-alcoholic drink options could be complex and flavourful. “I wanted to demonstrate it’s possible to have an elevated drinking experience without alcohol involved,” she says.

Most non-alcoholic beverages are distilled with alcohol, then the alcohol is removed, “along with most of the flavour,” she says. “While others rely on natural flavours or extracts to mimic certain profiles, the result feels more like a dressed-up soda. They’re refreshing, but lack richness and balance.”

Wild Folk cocktails are brewed through a unique infusion process in steel tanks, filtered through rice hulls, then carbonated. They’re made with a blend of herbs, botanicals and citrus rinds to create a complex cocktail with no alcohol, but all the flavour. Bee’s Knees has been a customer favourite since the start. It’s now joined by Sparkling Negroni, Vermouth Spritz and the new Mezcal Margarita.

For c-stores now stocking beer, wine and RTD cocktails, the NoLo trend is one that warrants attention, with experts saying it’s going to stick around for a good long while. Cheers!