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Big beer companies have done well in taking their core products into the non-alcoholic market and are pushing further into the fast-growing category, says Athletic Brewing's CEO.
“A lot of these flagship brands in our category are uncompromising when it comes to their alcohol-based counterparts, and I think the category is on a really good footing.” Bill Shufeldt, co-founder of the non-alcoholic beer maker, tells Food Dive.
Just half a century ago, In the non-alcoholic category, major brands are missing. Almost every brewer now has at least one flagship product in this category, including Molson Coors' Blue Moon, Diageo's Guinness, Constellation Brands' Corona, Heineken's eponymous beer and AB InBev's Bud Zero. Shufeldt estimates there are 150 non-alcoholic beverage brands in the United States.
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Licensed by Athletic Brewing.
According to the company, when Athletic launched in 2018, non-alcoholic beer accounted for just 0.3% of overall beer category sales, but it now accounts for about 1.5%.
The popularity of this drink is largely due to several factors, including new drinking opportunities and people's busy modern lives.d The importance of health. The Athletic noted that more than 80% of consumers still drink alcohol.
Retail sales of non-alcoholic beer were about $1.2 billion in the United States last year, and Shufeldt expressed optimism that non-alcoholic beer could eventually control up to 20 percent of the $100 billion-plus beer category within the next decade.
He said the health and wellness trend is unlikely to go away, and many retailers are slowly increasing the number of nonalcoholic options they carry. At some national retailers with more than 300 stores, nonalcoholic beer makes up 20 percent of beer sales. He said stores with little or no sales will eventually carry more nonalcoholic options, providing an additional catalyst for the beverage.
“Leading indicators point to a very large category.” Shufeldt said.
Athletic has quickly become the largest non-alcoholic beer company, with 20% of the category’s market share. The company’s off-premise dollar sales surged more than 65% in the year-ago period through March 23 compared to the same period a year ago. Nielsen IQ data.
Robert Ortenstein, Evercore’s senior vice president and head of global beverage and home products, said earlier this year that Athletic had “done an incredible job” with the brand, packaging and flavors. He praised the company for being “very disciplined and, I think, intentional” about the products it was launching.
At the same time, Athletic has also benefited externally from growing consumer interest in health and wellness.
“Everything is coming together. work outAnd I think it’s going to last a long time,” Ottenstein told attendees of the Beverage Forum conference in May. “If Athletic had come out 20 years ago, I’m not sure it would have been as successful as it is today.”
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Licensed by Athletic Brewing.
Shufeldt I agree. Social media and direct-to-consumer sales, along with health and wellness, have provided a catalyst for non-alcoholic beer that didn’t exist a few years ago. “I“If it was 20 years ago, it probably wouldn't have been too early,” he confessed.
Athletic has invested more than $100 million in beer production since its founding. In June, it purchased a 107,000-square-foot facility in San Diego across from its existing brewery for an undisclosed sum. The new manufacturing plant will help the company double its capacity to brew non-alcoholic beer.
Innovation has also been a key part of the strategy. The Connecticut-based company releases about 50 new beers a year, most of which are sold online, with the most popular selections moving to retail stores. Shufeldt Athletic said it may also branch out into other non-alcoholic beverage markets beyond beer, but for now it is focusing on its flagship beer.
“We have a lot of great innovative ideas, but anything that takes focus and resources away from our core,” he said.
Athletic's success has attracted the attention of major beverage companies interested in acquiring the brewery. Schafelt noted that the most recent funding round included a $50 million investment from Keurig Dr Pepper. But like most EntrepreneursHe dismissed talk of a deal and said the brand's long-term commitment Non-alcoholic category.
“All choices are naturally ours.” Shufeldt said. “But there is no point in closing any doors. It's like my life's work, and I think the future is really big and exciting.”
