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Beer Giants Bet Big on Non-Alcoholic Drinks as Americans Rethink the Booze

MarketDash Editorial Team
5 days ago
Molson-Coors and Anheuser-Busch are ramping up investments in non-alcoholic beverages as drinking habits shift. With only 54% of US adults consuming alcohol and the global non-alcoholic beer market expected to hit $35 billion by 2029, beer companies are expanding beyond their traditional roots to capture a growing market.

Beer companies have a problem, and it's not a good one: people are drinking less. So naturally, they're doing what any rational business would do—selling drinks without the thing that made them famous in the first place.

Molson-Coors Beverage Co. (TAP) is planning to acquire more non-alcoholic beer brands as American drinking habits continue their downward trend. The shift isn't subtle, either. According to a Gallup poll released in August, only 54% of US adults now say they consume alcoholic beverages—an all-time low.

Beyond Beer Is the New Beer

"While beer is our roots and at the core of our business, you can also expect us to step up our focus on beyond beer because we believe we can win here," CEO Rahul Goyal said on Molson-Coors's Q3 earnings call earlier this month. "Not only does it help to premiumize our business, but it also creates value for our customers by appealing to a wider range of consumer preferences and serving more occasions."

The company already produces non-alcoholic versions of its Coors and Blue Moon brands, but Goyal made it clear there are plans to "fill some gaps" in the zero-proof part of the portfolio and make it a much bigger piece of the overall strategy.

"So in terms of deploying capital, you will see us probably lean in a lot more on the beyond beer space than the beer space," he said.

That's a remarkable statement from a company literally named after beer. But the numbers back up the strategy. The global non-alcoholic beer market is expected to reach $34.98 billion by 2029, according to The Business Research Company.

A Blueprint for Growth

Molson-Coors acquired a minority stake in U.K.-based beverage company Fever-Tree earlier this year, and that acquisition could serve as a model for future deals to expand its non-alcoholic portfolio, Goyal noted on the earnings call.

"We want to make sure we deploy capital for brands that fill gaps in our portfolio," he said.

And Coors isn't alone in this pivot. Anheuser-Busch (BUD) saw net revenue from non-alcoholic drinks jump 27% year over year, CEO Michel Doukeris said during his company's Q3 earnings call.

"Non alcohol beer is a key opportunity to develop new consumption occasions and increase participation, and we are investing and innovating to lead the growth," Doukeris said.

The Market Is Bigger Than Beer Itself

Here's the kicker: while "beyond beer" currently accounts for just 2% of Anheuser-Busch's overall volume, the company plans to spend considerably more on it in the coming months.

"The opportunity here is huge because the addressable market outside of the beer category is very relevant and is bigger than the beer category itself," Doukeris explained. "It is a huge addressable market. Today it is a very small portion of our volumes, but it is growing very fast."

Think about that for a second. The CEO of one of the world's largest beer companies is telling investors that the market for everything that isn't beer is larger than the market for beer. That's either refreshingly honest or slightly depressing, depending on how you feel about tradition.

As more Americans give up alcohol entirely or opt for low-alcohol alternatives, breweries and craft beer manufacturers have started offering new non-alcoholic brews or near beer—beers with very low alcohol content. What was once a niche category is becoming central to growth strategies at major beverage companies.

For an industry built on getting people buzzed, betting on sobriety might seem counterintuitive. But when your core market is shrinking, sometimes the smartest move is to sell to the people who aren't buying what made you successful in the first place.

Back to News

Beer Giants Bet Big on Non-Alcoholic Drinks as Americans Rethink the Booze

MarketDash Editorial Team
5 days ago
Molson-Coors and Anheuser-Busch are ramping up investments in non-alcoholic beverages as drinking habits shift. With only 54% of US adults consuming alcohol and the global non-alcoholic beer market expected to hit $35 billion by 2029, beer companies are expanding beyond their traditional roots to capture a growing market.

Beer companies have a problem, and it's not a good one: people are drinking less. So naturally, they're doing what any rational business would do—selling drinks without the thing that made them famous in the first place.

Molson-Coors Beverage Co. (TAP) is planning to acquire more non-alcoholic beer brands as American drinking habits continue their downward trend. The shift isn't subtle, either. According to a Gallup poll released in August, only 54% of US adults now say they consume alcoholic beverages—an all-time low.

Beyond Beer Is the New Beer

"While beer is our roots and at the core of our business, you can also expect us to step up our focus on beyond beer because we believe we can win here," CEO Rahul Goyal said on Molson-Coors's Q3 earnings call earlier this month. "Not only does it help to premiumize our business, but it also creates value for our customers by appealing to a wider range of consumer preferences and serving more occasions."

The company already produces non-alcoholic versions of its Coors and Blue Moon brands, but Goyal made it clear there are plans to "fill some gaps" in the zero-proof part of the portfolio and make it a much bigger piece of the overall strategy.

"So in terms of deploying capital, you will see us probably lean in a lot more on the beyond beer space than the beer space," he said.

That's a remarkable statement from a company literally named after beer. But the numbers back up the strategy. The global non-alcoholic beer market is expected to reach $34.98 billion by 2029, according to The Business Research Company.

A Blueprint for Growth

Molson-Coors acquired a minority stake in U.K.-based beverage company Fever-Tree earlier this year, and that acquisition could serve as a model for future deals to expand its non-alcoholic portfolio, Goyal noted on the earnings call.

"We want to make sure we deploy capital for brands that fill gaps in our portfolio," he said.

And Coors isn't alone in this pivot. Anheuser-Busch (BUD) saw net revenue from non-alcoholic drinks jump 27% year over year, CEO Michel Doukeris said during his company's Q3 earnings call.

"Non alcohol beer is a key opportunity to develop new consumption occasions and increase participation, and we are investing and innovating to lead the growth," Doukeris said.

The Market Is Bigger Than Beer Itself

Here's the kicker: while "beyond beer" currently accounts for just 2% of Anheuser-Busch's overall volume, the company plans to spend considerably more on it in the coming months.

"The opportunity here is huge because the addressable market outside of the beer category is very relevant and is bigger than the beer category itself," Doukeris explained. "It is a huge addressable market. Today it is a very small portion of our volumes, but it is growing very fast."

Think about that for a second. The CEO of one of the world's largest beer companies is telling investors that the market for everything that isn't beer is larger than the market for beer. That's either refreshingly honest or slightly depressing, depending on how you feel about tradition.

As more Americans give up alcohol entirely or opt for low-alcohol alternatives, breweries and craft beer manufacturers have started offering new non-alcoholic brews or near beer—beers with very low alcohol content. What was once a niche category is becoming central to growth strategies at major beverage companies.

For an industry built on getting people buzzed, betting on sobriety might seem counterintuitive. But when your core market is shrinking, sometimes the smartest move is to sell to the people who aren't buying what made you successful in the first place.