Robust growth has been forecasted for no-alcohol and alcohol-adjacent beverages, but two categories are driven by different consumer motivations and are not in direct competition, a recent report has found.
According to new report from IWSR, global volumes of no-alcohol alternatives – including zero-ABV ‘spirits’ and ready-to-drink (RTD) products – are expected to grow by 36 per cent between 2024 and 2029, reaching an estimated 18 billion servings worldwide, equivalent to around two servings per person globally.
Alcohol-adjacent beverages, a broader category that includes functional drinks, are forecast to grow by 11 per cent in volume in 2025, albeit from a significantly smaller base.
IWSR said demand for the two categories is being driven by different factors. Consumers are typically choosing no-alcohol alternatives for health and moderation reasons, while alcohol-adjacent drinks are more often purchased out of curiosity or for their perceived functional effects.
Alcohol-adjacent beverages include non-intoxicating hemp drinks, nootropic and adaptogenic functional beverages, as well as products with so-called ‘alcohol cues’ such as botanicals, sparkling teas and fermented drinks.
The findings are based on an IWSR survey conducted in August 2025 across 10 key markets – including the UK, US, France and Germany – with 7,973 legal drinking age respondents.
The survey revealed that 40 per cent of consumers choosing no-alcohol ‘spirits’ cited making a “healthy lifestyle choice” as their primary motivation.
In contrast, just 26 per cent of respondents said they bought alcohol-adjacent beverages for health reasons, with others pointing to curiosity (20 per cent) or a desire to experience alcohol-like effects through functional ingredients (17 per cent).
IWSR head of no- and low-alcohol, Susie Goldspink, said the beverage alcohol sector ‘must prepare for diverging consumer preferences to fully capitalise on the two growing trends’.
She explained: “No-alcohol analogues like no-alcohol beer and wine are an increasingly popular way for drinkers to moderate their alcohol intake. By mimicking the taste and appearance of alcoholic beverages, drinkers who want to moderate can participate fully in occasions without feeling left out.
“Alcohol-adjacent drinks are also growing in popularity, but consumers are using them in a different context, choosing them more for their functional benefits rather than as a mechanism for moderation.
“Both categories are poised for continued strong growth, but most likely as distinct products, not competitors.”