8 minute read
NOLO: MODERN MODERATION
Modern moderation
As more venues offer no- and low-alcohol options, Caoimhe Hanrahan-Lawrence investigates how we drink when we’re not drinking.
THE NO and low alcohol (NOLO) sector has been growing steadily and significantly over the last few years, both with an explosion of high-quality new products in the space, and with an increase in demand. According to the ISWR, 30 per cent of the adult population now consumes nonalcoholic beverages.
This shift is primarily driven by younger generations, whose perspectives are changing regarding the role of alcohol in their lives. According to La Trobe University, research indicates that 15 years ago, the after-effects of excessive drinking were viewed as neutral or even positive. However, current generations are much more concerned by these effects, and are seeking to moderate their alcohol intake.
This does not mean that people are abstaining from alcohol altogether. In fact, IWSR data indicates that 78 per cent of people who consumer NOLO drinks also drink full-strength alcohol. The occasions in which patrons choose NOLO drinks are incredibly varied, and include work functions, family events, or abstinence months such as Dry July or Feb Fast.
“The attitude toward non-alc drinks has very much changed, with non-alc drinks no longer just targeted at ‘non-drinkers’ or pregnant women, but now being enjoyed by people who normally drink alcohol but may decide at any present time not to, yet still want to enjoy the same great taste and flavour that alcoholic drinks provide,” confirmed Owen Hughes, venue manager at Sydney’s Harbord Hotel.
All-day drinks
As much of the sector’s growth occurred during the pandemic, the on-premise was poorlyplaced to capitalise on it due to lockdowns and restrictions. However, David Murphy, CEO of nonalcoholic spirits company Lyre’s, sees the tides beginning to turn.
“If we think of how many non-alcoholic spirits brands were in the market in 2020, 2021, you could count them on one hand, and the drink recipe options were generally limited. Any acceptance or legitimacy of the sector was still slowly building and on-premise was juggling lock downs. Then there was a bounce back and people were out again.
Post-covid, we have seen that the shift towards non-alcoholic beverage options for on-premise venues has really gathered momentum,” Murphy commented.
Additionally, Anthony Hammond, owner of Melbourne’s Victoria Hotel, said that publicans may be sceptical about the popularity of NOLO beverages.
“Until you have empirical evidence, you may not believe it,” Hammond said.
However, sales data provided to Australian Hotelier by several venues indicates that NOLO beverages are incredibly popular on premise. Among these venues, non-alcoholic beer Heaps Normal is the first or second biggest-selling SKU in the packaged beer category, and non-alcoholic cocktails are consistently among the top ten most popular cocktails.
For Emmi Masten, communications manager of Parker Group, NOLO drinks are a key part of broadening the customer base for the Royal Hotel Perth.
“Offering a well-curated selection of mocktails, non-alcoholic beers, wines, or other alcohol-free alternatives does help in attracting a more diverse customer base,” she noted.
An exemplary experience
Of course, non-alcoholic options have always been available in the on-premise in the form of soft drinks, but NOLO options provide guests with sophisticated adult beverages that don’t set them apart from other patrons consuming alcoholic beverages. Hammond noted that customers are more likely to purchase multiple serves of a non-alcoholic beverage, whereas they would not typically purchase multiple serves of soft drink.
“Economically, you’re better off selling a couple of these nonalcoholic products than a can of cola,” he argued.
Tyler Martin, co-founder and CEO of non-alcoholic RTD company Yes You Can, pointed out that non-alcoholic options provide customers with a different experience than soft drinks do.
“It’s a markup from water and soft drink from a price point, but also from an experiential point for the consumer,” Martin explained.
Publicans see a rise in NOLO sales around abstinence months, as well as in October, when people begin to cut down on alcohol ahead of the holiday period. At the Victoria Hotel, Hammond has noticed that NOLO consumption does not drop sharply after activations. Instead, he has seen NOLO drinks increase in popularity with each activation.
“There is typically an uptake during Dry July or Feb Fast but it’s increasingly becoming a category that continues to grow, irrespective of the established month-long campaigns,” Hughes remarked.
Non-alcoholic sales are also popular early in the week, as well as during meal service times.
“Guests are consuming non-alc drinks with meals, with finger food and sometimes on their own. It’s different for everyone, and it changes with each customer. We also see people alternating between full strength and non-alcoholic drinks such as when settling in for an arvo watching the footy,” Hughes added.
Tracking trends
As the NOLO segment is closely linked to the alcoholic drinks segment, NOLO drinks are often influenced by the same trends. For example, the current cocktail trend has carried over into a demand for no- and low-alcohol cocktails.
“The flavour complexity is often enough for people, without having to add alcohol. We can mimic the flavours and presentation of popular cocktails,” Masten remarked.
When choosing what non-alcoholic cocktails to include in your menu, Murphy recommends starting with alcoholic cocktails that are popular and creating a non-alcoholic version of those drinks. The growing range of non-alcoholic spirits that directly mimic popular alcoholic counterparts simplify this task.
“We focus on quality of flavour, taste, drinking experience and expectation that a bartender may have when making a cocktail with a particular spirit. We need to reduce the challenges for both our onpremise customer and their patrons purchasing the beverage,” Murphy described.
Many venues have seen success with providing both non-alcoholic versions of pre-existing alcoholic cocktails, as well as cocktails unique to the non-alcoholic section. When crafting new non-alcoholic cocktail recipes, Hammond advised against relying too heavily on fruit juices and other overly sweet ingredients, as these are not typically flavours that cocktail drinkers will gravitate towards.
“Keep it simple, seasonal, while continuing to offer your guests a great drinking experience,” Murphy recommended.
Presentation is another important aspect of nonalcoholic cocktails: though they may not contain alcohol, they should still look and feel like their alcoholic counterparts.
“As long as it’s garnished nicely and presented well, people are more than happy to pay for a nice non-alc cocktail,” said Daniel Ferguson, owner of Newcastle’s Hotel Jesmond.
Catering to community
As more drinkers are moderating their alcohol consumption, quality NOLO options are becoming an expected offering in the on premise.
“I feel the tide has changed and customers expect a venue to have a few non-alc options available when they visit,” said Hughes.
While the majority of the consumers of NOLO beverages are moderating their alcohol intake, ex-drinkers are an increasing section of the population, especially among 18- to 29-year-olds.
In 2019 the National Drug Strategy Household survey estimated that there are 1.9 million exdrinkers in Australia, or 8.9 per cent of the adult population. As a comparison, approximately 10 per cent of Australians are vegan or vegetarian. As a non-drinker himself, Hammond emphasised the importance of catering to sober customers as well.
“If people don’t take that part of the market seriously, and you are part of that part of the market, you feel left out,” Hammond said.
Additionally, Hammond emphasised that pubs are not exclusively about alcohol consumption, but actually play a larger social role.
“The pub is the community. You go there to meet your mates, watch the footy or cricket, whatever is on, you go there to have a yarn. You go there to meet people and be involved,” he reminded.
Ultimately, non-alcoholic drinks allow customers to engage in social occasions at the pub even if they don’t want to drink. Not only can providing NOLO options increase revenue, it can also foster a social, welcoming community around a venue.
