According to IWSR’s recent data, the Gen Z drinking trend is taking a different turn. Legal-drinking aged consumers are seen enjoying very distinct relationship with alcohol where more preference is given to low alcohol volume categories rather than traditional categories. There is also rising awareness which is resulting in increasing moderation and abstention. Moreover, the younger category of LDA is avoiding alcohol consumption altogether, specifically seen in key markets with varying percentages.
IWSR’s data suggests that across 15 significant markets, including Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, South Africa, Spain, Taiwan, the UK, and the US, Japan stands out with the highest rate of abstention among Gen Z consumers (aged 18-26). 63% of Japanese individuals in this age group assert not having consumed alcohol in the last six months, followed by the US at 54% and Canada at 44%. In these examples above, the Gen Z consumers present levels of abstention that are higher than the total adult population across their overall markets. However, considering the various legal drinking age thresholds, the Gen Z consumers are underrepresented in countries like US and Canada. In both markets, Gen Zs are purchasing less alcohol in terms of recalled volume momentum. However, in the US they claim that they are spending more when they make a purchase.
According to Richard Halstead, the COO Consumer Research, IWSR, “A surprisingly large proportion of younger LDA+ communities are now claiming that they abstain from alcohol altogether. This is particularly true in Japan and North America, but the moderation trend is also prevalent in other markets across Europe, Asia and Australasia.” The category that consumes alcohol is seen presenting a rather unique relationship with alcohol that involves beers, wines, RTDs (ready-to-drink) drinks, spritzers, liqueurs and white-spirit based cocktails. In countries like India, Mexico, South Africa, Brazil, the US and Italy, the younger adult drinkers are the key drivers of cocktail consumption and in turn experiment a lot with mixology and its ways. The European market displays a low momentum in terms of volumes with recalled spend up in France, Germany and Italy; neutral in Spain; and down in the UK. The UK however has seen an increase in the consumption of champagne and vodka.
In the Asian market there has been an increase in the volume and spend in countries like India, China and Taiwan. The Chinese market is a diverse market with an increasing spend on beers, plum wine, huangjiu (rice wine), grape-based wine and US Whisky but is also abstaining and withdrawing from the baijiu category. Halstead says, “It is worth noting that it is very early days for Gen Z drinkers in the beverage alcohol market, and close monitoring of their behaviour over time will be required to see how their tastes evolve, however, some of their behaviours – reduction in alcohol quantity consumed, preference for cocktails and premium beverages – is also apparent in the preceding generation known as Millennials (aged from their late 20s to early 40s).”
This essentially represents a world wherein beverage alcohol producers are moving towards premium must-have beverages, as well as those with low or even zero alcohol levels, with a greater focus on the setting and/or packaging to provide an even more memorable experience.
