Low-Alcohol Beverages are Ringing Up Big Sales in Canada

Low-Alcohol Beverages are Ringing Up Big Sales in Canada

Choice is rampant across many consumer categories in Canada, and the alcoholic beverage realm is a perfect example. But when we look more closely at this vast category with an eye for opportunity and growth, we see quite a bit of growing interest in beverages with low alcohol levels (defined here as those with alcohol by volume {ABV} percentages of less than 1%).

In the 52 weeks ended Jan. 6, 2018, low-alcohol beverage sales exceeded $69 million, an increase of 10% over the previous year. And when we look at the timing of purchase spikes in Canada, we see that four of the top five selling weeks for low-alcohol beverages in 2017 aligned with holidays:

  • Christmas, Boxing Day and the pre-Christmas/Hanukkah weeks topped sales weeks, with 2.9% of annual low-alcohol beverages sales happening each week (compared with the average week which accounts for 1.9% of annual sales).
  • Canada Day follows with 2.7% of annual sales, which is no surprise, as Canadians were likely celebrating Canada’s 150th Birthday and taking in the summer sun with a refreshing beverage in hand.

As Canadian consumers become more accustomed to the variety of low-alcohol beverages available to them, retailers and manufactures should make note of holidays and special occasions to promote these products and cross-merchandise them with other holiday staples.

As consumers put their money where their mouths are, the biggest challenge newcomers to the market face is endurance. While they need to create a product that’s distinctive and relevant, that product also needs to be able to endure within the market and make its mark on the retail landscape.

An in-depth understanding of consumers’ taste preferences across beverage categories is critical, particularly when product developers look at the cost of new product introduction and the value of store shelf space. As retailers and manufacturers continue to add new products to their assortment, they will need to ensure that they’re developing the right products and marketing them to the right consumers to see continued success in the category.