BSmall beer bottles bearing the five Olympic rings are already rolling off the production line at the Anheuser-Busch InBev NV brewery in Belgium in preparation for this summer’s Paris games.
It’s been 100 years since the French capital last hosted the Summer Olympics, and the city is looking to make its mark after Covid meant the Tokyo Games were held in largely empty stadiums. And now, for the first time, there will be a beer sponsor for an event that showcases the pinnacle of human sporting achievement.
But in this case, the drink – Corona Cero – does not contain alcohol.
The world’s largest brewer chose to advertise to billions of sports fans an alcohol-free product launched in Europe just two years ago. AB InBev hopes to use the Paris Games – which are expected to be one of the biggest marketing bonanzas the Olympics have ever seen – to improve its position in the only part of the global beer industry that is truly growing.
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With a value of $13 billion and counting, brands like Heineken, Guinness, and now Corona Cero, see a group of health-conscious consumers – many young, others older and eager to break out of the alcohol culture. – whose portfolios they can explore.
Brewmasters have been working on formulas to try and replicate the taste and texture of real beer. Heineken, Guinness and Budweiser are now available alcohol-free, while hundreds of craft brewers and newer labels are emerging to hit the market.
For Michel Doukeris, CEO of AB InBev, it is quite simple: “The consumer has changed”.
Non-alcoholic beer, or beer with an alcohol content of less than 0.5%, is a small corner of the market, with its 31.4 million hectoliters per year surpassed by alcoholic beer’s 1.93 billion hectoliters, according to GlobalData Plc .But it has had a compound annual growth rate of 3.6% since 2018, compared to 0.3% for alcoholic beer. In the US, the number of adults aged 18 to 34 who say they drink has fallen from 72% in the early 2000s to 62%. according to Galup.
These are numbers that companies cannot ignore, especially AB InBev. He’s already late and says he’s going to miss a goal 20% of sales of low or no alcohol beer by 2025.
“There are many sporting events, such as the Olympics, where the main brands are often the 0% variant,” said Susie Goldspink, head of no and low alcohol insights at market researcher IWSR. “This is partly because it is a growth area, but it also helps with their responsible consumption moderation agenda.”
There is also a broader benefit for brewing companies. As their non-alcoholic versions often share the same name and label as the original beer, promotions help brand awareness and allow companies to bypass increasingly stringent restrictions around alcohol advertising.
The Olympics are part of a trend to promote non-alcoholic beers through sport, including Heineken 0.0 with Formula 1 and Diageo Plc’s Guinness 0.0 at the Six Nations rugby tournament. Carlsberg A/S distributed last year 400,000 cans of Tourtel Twist non-alcoholic French beer at the Tour de France cycling race.
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And in a sign of competition between brands, Carlsberg is positioning Tourtel Twist as the non-alcoholic beer of choice at the Paris Games.
“We are the official beer of Paris and France,” said Jacob Aarup-Andersen, CEO of Carlsberg. “They are the official beer of the Olympic movement. At events you will be served Tourtel.”
US-based Athletic Brewing Co., which sells only non-alcoholic drinks, says an Olympic sponsorship benefits the entire category.
“Sometimes to move the needle you need bigger players who can help raise awareness,” he said John Walkerco-founder of the company.
For beverage companies, there is a pressing need to keep up with the changing trends that have already proven to be the death knell for many companies. More than 7,000 pubs in the UK have closed in the last decade, according to the British Beer and Pub Association. While alcohol taxes, rents, costs and regulations have played a role, changing drinking habits have also played a role.
As consumers, especially the social media-driven millennial and Gen Z demographic, look to moderate their alcohol consumption, it is better to have a viable – and attractive – offering rather than having them turn to a rival brand, a soft drink or water.
Heineken 0.0 is the world leader in the non-alcoholic beer market, according to GlobalData. Other big sellers are Japan’s Suntory All-Free and Brahma 0.0%, owned by AB InBev.
At the world’s oldest continuously operating brewery in Germany, non-alcoholic beers have been produced since the early 1990s. But in 2020, thanks to increased demand, Bavarian-owned Weihenstephan more than doubled its capacity of non-alcoholic beer, betting on future growth. Today, its non-alcoholic wheat beer represents almost 10% of sales and is its third best-selling product.
But all the promotion in the world can only carry non-alcoholic beer so far if it’s not good.
Until relatively recently, non-alcoholic beer didn’t compare well to the original, leaving consumers dissatisfied. For brewers, there was a technical conundrum: how to achieve depth of flavor without alcohol. Do they prevent alcohol from forming during the fermentation process or remove it after a stronger version is made?
According to Jim Koch, president of the Boston Beer Company, which brews Samuel Adams, advances in flavor have only been possible in recent years as brewers discovered a low-temperature distillation process. The brewery launched its own alcohol-free product, Just The Haze, in 2021.
Launched in 2017, Heineken 0.0 is made with water, barley malt, hop extract and yeast – the same ingredients used in Heineken. The alcohol is then removed using vacuum distillationafter which the natural flavors and aromas are blended again to make the taste more like the original.
“For a few years I refused to start developing Heineken 0.0,” said Willem van Waesberghe, Heineken’s global brewmaster. “Because I’ve never tasted a good one.”
The Olympic Games start in two months, with the Opening ceremony which will take place on July 26th. AB InBev will soon reveal details of its campaign, which it hopes will “accelerate the growth of non-alcoholic beer”.
Furthermore, introducing non-alcoholic beer is expected to provide the next leap in terms of volumes, increasing sales in bars, making drinks more socially acceptable. It’s more of a technical challenge, but one that the brewers are working on.
“It’s as if the rosé in the south of France is always better than it is at home,” Waesberghe said. “And in a bar you like the draft beer, it gives the impression of authenticity.”
This story originally appeared on Time.com read the full story
