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The 'Dry January' effect
00:17:28
We take a look at a growing alcohol-free drinks market that packs a punch for its size
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- [00:00]
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Sonja Mitchell
It starts off there in the mash tun. That's where the grain gets mixed with the hot water and. And essentially we extract all the flavour and colour from the grain.
- [01:34]
Imran Rahman Jones
I'm treading carefully among long, flexible pipes snaking between shiny metallic tanks, being shown the brewing process for one of humanity's oldest known drinks beer.
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Sonja Mitchell
The bigger ones over there take 4,000 litres of liquid, and the tanks with the conical bottoms are the ones where we're adding more hops.
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Imran Rahman Jones
We're at a brewery just outside Scotland's capital, Edinburgh, and founder Sonja Mitchell is explaining how her beer is made. But there's something different about the product here. It's brewed with almost no alcohol.
- [02:06]
Sonja Mitchell
The flavours are developing in the beer, so we'll be tasting it as it goes along till it gets to the point where it's ready then to get packaged.
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Imran Rahman Jones
Sonja's company, Jumpship, and many other brewers around the world have been gearing up for a big few weeks as the dry January movement that's going a month without alcohol has grown in recent years in countries such as the us, Japan, South Africa and across Europe. I'm Imran Raman Jones, and today on Business Daily, we're looking at the alcohol free drinks market and asking why it has boomed in the past few years around the world. From the retailer operating in a Muslim.
- [02:48]
Erica Doyle
Country, venues who aren't allowed to serve alcohol, they have to be imaginative and they have to make sure that they're offering something super exciting to the fully dry bar.
- [02:57]
Imran Rahman Jones
In West Africa, we wanted to still.
- [03:00]
John Asagonde
Offer the same vibrant atmosphere that comes with going out, you know, listening to some good music, the lights, the performances, but without being pressured to have to drink.
- [03:12]
Imran Rahman Jones
As some people opt for moderation over inebriation, we'll be hearing about the effects of switching from alcohol to abstinence. Festive celebrations at Christmas and New Year often involve increased alcohol consumption in many parts of the world. For some, that's followed by a decision to take a break from drinking. It's widely become known as dry January. But increasingly people are choosing to reduce their alcohol all year round. World Health Organization data suggests alcohol consumption has been falling since about 2013. And according to global drinks industry research body Worldwide, alcohol sales have been flat since 2019. Martin Lodewijks is their president and managing director.
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Martin Lodewijks
The trend for non elk grew initially more in your developed markets, so in Europe, in the US and that sort of started even sort of 10, 15 years ago. But I think over the last five years what's really changed is that you're now seeing really strong non elk growth coming out of emerging markets as well. So out of India, out of China, out of South America, out of Africa.
- [04:24]
Imran Rahman Jones
There are a couple of important points here though. The growth in sales varies quite dramatically depending on the country. So In Brazil, the US and UK, annual growth was at over 20% between 2019 and 2024. In Japan that was 8% and in France 7%. That's all according to the IWSR. And the second thing to note is.
- [04:47]
Martin Lodewijks
Globally, non elk products are about 1% of the total industry.
- [04:53]
Imran Rahman Jones
So it's a small but growing market. But it's one which fewer drinks companies feel they can ignore.
- [04:59]
Martin Lodewijks
There have been no dips. They've tended to kind of grow on the high single digit double digits for those last five years, which suggests that it's very much becoming embedded in consumers repertoires in how they sort of behave and drink and go out.
- [05:16]
Imran Rahman Jones
Another thing to mention, the alcohol free market is currently dominated by one type of drink. Johnny Forsyth is the principal strategist for food and drink for the global research agency Mintel.
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Johnny Forsyth
Non alcoholic beer has got an incredibly prosperous future. That's because a lot of people drink alcohol for refreshments. And relaxation. And our data shows that that non alcoholic beer is meeting that need amongst consumers. Wine and spirits is completely different. They're much more alcoholic Dr. Drinks therefore it's much harder to replicate the taste of them. So I'm not convinced yet that they're going to be more than kind of niche growth opportunities.
- [05:59]
Imran Rahman Jones
So alcohol free beer's seemingly bright future is good news for someone like Sonja Mitchell at Jumpship Brewery. But why did she get into it in the first place?
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Sonja Mitchell
Beer has always been my drink of choice. I played rugby in my youth. Going to the pub has been a big part of my identity and I just hit a point. In my 30s I had three children. A job just. And I still wanted to sit down at the end of the evening with a. With a beer and relax. But I just didn't feel as sharp the next day. But I didn't want to give up that moment of relaxation and everything else I love about beer in terms of particularly craft beer. The different flavours. And I wanted to have all of that just alcohol free. And I couldn't see anyone else doing it. And so I thought I'd have a go.
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Imran Rahman Jones
How long did it take to get a good beer that tasted nice?
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Sonja Mitchell
I mean I was incredibly naive. I had no idea how hard it was going to be. I don't have a background in brewing or the beer industry. I just tell people I had a background in drinking and bad hangovers. So I worked with a professional brewer on the first recipe. We brewed a few different versions. One was terrible, one was okay and one was brilliant. So everyone I shared this beer with loved it. Which kind of gave me the confidence to. To take it and the next step to scale commercially.
- [07:22]
Imran Rahman Jones
And then when you finally hit that beer that works, that non alcoholic beer that works what does it feel like to have got there?
- [07:28]
Sonja Mitchell
I mean it's really joyful and I think that's what I love about working in this space. When you can give someone a really good alcohol free beer and they realize that they're getting everything they love just not the alcohol. And that actually there's a huge amount of discovery still to happen. The category is exploding. There's some really good non alcoholic beers and other drinks out there. So actually it's just the start of a whole new journey rather than just about giving up.
- [07:53]
Imran Rahman Jones
The non alcoholic drinks market was pioneered by smaller craft producers. But in recent years the huge drinks companies have also got involved.
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Sonja Mitchell
What did you expect from a 00.
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Imran Rahman Jones
Newbie feta 000% alcohol Perna Ricard launched alcohol free beefeater gin giants AB InBev have released 0% versions of Corona and Budweiser beers. And Diageo says its Guinness 0.0 saw double digit growth in sales last year.
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Erica Doyle
I think the beautiful thing about non alcoholic drinks category globally was that it was started by the craft producers.
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Imran Rahman Jones
Erica Doyle is the founder of Drink Dry, an alcohol free drinks retailer and wholesaler based in Dubai.
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Erica Doyle
But then for it to really own the space, it needs money and it needs the big guys to come in and play and open up some doors. And then you have a nice balance of mainstream commercial brands at a certain price point, but then you have a lot of premium on that.
- [08:52]
Imran Rahman Jones
It's interesting looking at some of the way you kind of market yourselves online on your website and social media, you're not going for the it's healthier or it's better for you. All kind of, you know, ethically or morally or for religious reasons. Was that a choice right from the beginning that you go for the premium market?
- [09:09]
Erica Doyle
It you, you absolutely right. We made that decision very early on to make sure it's a consumer lifestyle brand opposed to being very preachy I think is the word. And we didn't want to be preachy. We wanted people to be excited to try these drinks because they seem fun. People for, for centuries had been congregating around food and drink as part of their socializing element. So we want to show that it doesn't have to be just with alcohol, it can be with non alcoholic drinks.
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Imran Rahman Jones
It can be with in terms of the customers. Are the majority of your customers expats from outside the Middle east or are they locals, are they Muslim for example, going for, for a non alcoholic drink?
- [09:51]
Erica Doyle
We have two different markets here, two different consumer types. So one is your expat, your western expat, people who are well versed in alcoholic terms, people who are well versed in the culture, the occasion, the serving rituals. So that's one consumer type that we have. And I would say at the beginning this was our low hanging fruit because we knew how to quickly target them. And then we have a completely different consumer segment which are the non drinkers, people who do not understand the occasion around alcohol. They do not have any kind of inner understanding of the rituals that come with that. They don't know that you celebrate with a sparkling wine opposed to something else, you know. So it's, it, it, it requires two different marketing strategies altogether to make sure that we reach both consumers with the same message, just packaged up slightly differently.
- [10:51]
Imran Rahman Jones
Erica also sells to bars and restaurants in Dubai.
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Erica Doyle
We have two different, let's say types of hospitality segments here. One is the licensed venues where people can buy alcohol and the other part of it is where they are 100% unlicensed. So venues who aren't allowed to serve alcohol, they have to be imaginative and they have to make sure that they're offering something super exciting to their customers who are coming to eat there.
- [11:18]
Imran Rahman Jones
You're listening to Business Daily on the BBC World Service.
- [11:24]
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- [12:27]
Imran Rahman Jones
I'm Imran Rahman Jones and today I'm looking at the rise of alcohol free drinks around the world. This time of year, January is a popular one for people to give up or at least cut down on their alcohol consumption. There are also other abstinence campaigns at other parts of the year, such as Sober October. But increasingly people are opting for alcohol free drinks all year round. Here's Martin Lodewijks of the iwsr.
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Martin Lodewijks
There's some interesting data that's come out of our consumer studies in the last sort of wave. There seems to be less interest amongst consumers to just do that. I'm taking one month off, but the fact that nonal continues to grow suggests that what's happening is not that the concept of dry January is fading, but rather that moderation is extending across the year. So instead of doing what I want to do for 11 months and then behaving myself for one. I'm going to sort of try and just sort of moderate my consumption more consistently over the course of the entire year.
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Imran Rahman Jones
Johnny Forsyth of Mintel agrees and says his research shows campaigns such as Dry January are not the main reasons behind the rising growth in alcohol free drink sales.
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Johnny Forsyth
It's really the kind of the bigger macro factors that have driven the growth of non alcoholic drinks. Primarily those are consumers being much more conscious about their health and also governments realizing that drinking alcohol is problematic and puts a lot of pressure on their health systems and investing a lot of money in anti drinks advertising.
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Imran Rahman Jones
Of course, much of our drinking, alcohol or not, is done around social events and for that you need somewhere to go.
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John Asagonde
I quit drinking in 2018 and I quickly found out that in Accra there were few places that you could go to to hang out and socialize without alcohol. So I wanted to provide that alternative for people like me.
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Imran Rahman Jones
John Asagonde is an entrepreneur and writer based in Accra in Ghana.
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John Asagonde
I run Eden Bar, the first non alcoholic bar in my region in Ghana and in West Africa.
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Imran Rahman Jones
If I didn't know it was alcohol free, it looks like a normal bar, just, you know, lots of young people hanging out, live music and lots of events going on.
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John Asagonde
Absolutely. That was the whole idea. We wanted to still offer the same vibrant atmosphere that comes with going out, you know, listening to some good music, the lights, the performances, but without being in pressured to have to drink or to have to smoke or to have to engage in some of those excesses. And then the drinks are also exceptional. So even though it's non alcoholic, you're not ending up for just some basic soda or some basic juice. We actually craft our cocktails to mimic the sophistication and, you know, the taste and feel of a traditional cocktail.
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Imran Rahman Jones
Have you seen a change in kind of attitudes towards drinking?
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John Asagonde
Yeah, most definitely. Of course I can take the credit to myself because Accra has a population of over 3 million people and I'm just doing my own bits in my, my small corner. But we've really seen that impact, especially on social media. You'd see people talking about Edinburgh, you know, referencing us when a conversation about alcoholism or something comes up. So we've been able to create that new trend for younger people to want to choose different and that's something I'm really proud about.
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Imran Rahman Jones
Do you think the demand is there? Because hospitality, as you know, is quite a difficult business anyway, let alone in the alcohol free space when it comes to demand.
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John Asagonde
I think the demand is there, but it's not been structured because you would find that even in Ghana there is a large population that don't drink alcohol for mostly religious reasons. You know, Islamic people don't drink alcohol and some Christians also don't drink alcohol. But I think the missing link is that they are not even aware that they can have products like these. Like a non alcoholic.
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Advertisement Voice
Yeah.
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John Asagonde
Or a non alcoholic wine or spirit. So I think a lot of education has to go on and even in Europe and other parts where the industry is booming, there's been a lot of awareness created to get it to where it is now.
- [16:51]
Imran Rahman Jones
While sales of alcohol free drinks are tiny compared to alcoholic ones, they are growing year on year. Mintel's Johnny Forsyth thinks we have not seen the peak yet.
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Johnny Forsyth
So this can grow significantly more, particularly in the non alcoholic beer market. I'm still not convinced about non alcoholic wine, non alcoholic spirits. But for example, if you take a market like Germany, our figures show that it accounts for 8.5% of all alcoholic beer sales. So that's quite a significant chunk. In many other markets that'll be just around 1%. But what it does show is that this has got significantly more Runway to go.
- [17:32]
Imran Rahman Jones
IWSR's Martin Lodewijks again, the general trend.
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Martin Lodewijks
Is that the non alk drinker is an alk drinker. So it tends not to be abstainers that drink non alk products. It's alcohol drinkers that are choosing a non alk product in a particular occasion. So the fact that the participation rate still trails the participation of consumers in alcohol more broadly suggests that it would continue to grow in most of these markets.
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Imran Rahman Jones
And Erica Doyle of Drink Dry on what's in store for the rest of 2026.
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Erica Doyle
The consumer is becoming more and more curious in the category, so they're willing to try other things and as long as we can help them in bringing the convenience element to it. Because you might want to do something, but you don't have the skill sets like making fantastic cocktails, but you don't have the skill set with non alcoholic spirits. We want to take that problem away, that obstacle away and bring in a lot more ready to drink options that are one serve, whether that's a ready to drink can or ready to drink smaller format bottles. So I definitely see that happening in the Middle east where consumers are becoming more and more excited about what's to come. I would love to see more homegrown non alcoholic drinks brands coming from the Middle east that we could be proud of as a homegrown brand and actually export out.
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Imran Rahman Jones
And brewer Sonja Mitchell, we've just got.
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Sonja Mitchell
Some new tanks in which has increased our capacity to about 1600 hectolit a year and we've got plans to double that again next year.
- [19:04]
Imran Rahman Jones
So business must be going well. Lots of people want to drink alcohol free.
- [19:08]
Sonja Mitchell
Yeah, it's amazing. I don't think I ever believed that the category would take off in such a short amount of time. Once people discovered that actually alcohol free beer now tastes nice, then the rest of it follows. Because if you can sit there and not drink and enjoy it, then it's just there's no reason not to do more of it.
- [19:32]
Imran Rahman Jones
Thanks for listening to this edition of Business Daily on the BBC World Service. It was produced and presented by me, Imran Rahman Jones.
- [19:53]
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