The Emergence of Lower-Alcohol Beverages: The Case of Beer

Kym Anderson

No 2023-01, Wine Economics Research Centre Working Papers from University of Adelaide, Wine Economics Research Centre

Abstract: Another quiet revolution is taking place in the alcoholic beverage markets: a trend toward lower-alcohol and even no-alcohol beverages, especially in the world’s higher-income countries. This new trend adds to the long-term consumer trend in affluent countries of substituting quality for quantity in many of their purchases (premiumization) which, in the case of alcoholic beverages, has been driven largely by a desire for a healthier lifestyle. More-affluent consumers also desire a greater variety than is typically available from large producers of regular products, which has led to a craft beverage revolution. Both desires – for lower-alcohol beverages and for a greater variety of quality offerings – are driving this so-called Lo-No revolution. The trend is just beginning to show up in wine (and spirits) markets, but it began developing much earlier in beer markets. The purpose of this paper is to explore the extent of the latter and the consumer forces behind it. Since Australian brewers are leading the way globally in building various Lo-No beer categories, and thereby contributing substantially to lowering that nation’s alcohol consumption, its trends are highlighted and compared with global trends. The paper concludes by drawing out lessons and prospects for lower-alcohol beer and wine.

Keywords: Lo-No alcohol; premiumization; craft beverage revolution; excise taxation of alcohol (search for similar items in EconPapers)
JEL-codes: D12 F14 I18 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2023-01
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Journal Article: The emergence of lower-alcohol beverages: The case of beer (2023)
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