Market Opportunities provided by No-Low and Sparkling Wines:
- One in three wine merchants sees very good sales opportunities for low-alcohol wines, one in four for no-alcohol wines
- No-low sparkling wines and white wines are in highest demand
- 16% of wine merchants are looking for new no-low wines for their product ranges
April 21st – The companies in the wine industry respond proactively to the current challenges of the economic crisis. In the current ProWein Business Report 2022, nearly 2,500 wine sector experts from 47 countries were surveyed about their plans for the current year. Almost half (46%) of the wine producers and merchants want to adapt their product portfolio to market trends and 27% are investing in innovative products.
On a global scale, the ‘no-low’ category is among the fastest growing beverage segments. This innovative product category consists predominantly of alcoholic beverages that were dealcoholized or contain substantially less alcohol by volume. According to the IWSR global no-low sales in 2022 exceeded $22 billion. According to the IWSR, annual sales growth of 7% is expected for the next five years through to 2026, with 90% representing the main growth share of the entire beverage industry.
The international growth of the no-low market had so far been driven primarily by the early innovations in alcohol-free beers and ciders that were mature in taste. But over the past few years, major progress has also been made regarding product quality of dealcoholizing wines. Although the market share of wines and sparkling wines with no or low alcohol is still small, it is posting very good growth rates in many countries. This is why ProWein in cooperation with Meininger publishing house organized the “World of Zero” focusing on dealcoholized wines in March 2023 for the first time.
For this reason, the current ProWein Business Report 2022 surveyed retailers from 16 different countries for the first time on the market opportunities and sales potential of the no-low wine category. It is thus the most comprehensive international report on this innovative and rapidly growing product category, which is benefiting above all from consumers’ increasing health awareness. The results provide retailers and producers with valuable information on which types of no-low wines are in demand in which countries and where there is particularly high interest among retailers in listing new no-low products.
Product trends
In order to measure the relative sales opportunities of the various wine types, almost 1,150 wine merchants, importers, distributors, restaurateurs and hoteliers were asked in November 2022 which products they felt would be in demand in 2023. The list of trending products is clearly headed by sparkling wines, Champagne, Cava and Prosecco, which already posted very good market successes in recent years. This year, ProWein again offered a focal area for this trend segment with the successful Champagne Lounge.
Low-alcohol or dealcoholized wines are viewed as trending products by one third of the wine trade. Merchants overall see better opportunities for low-alcohol wine than for no-alcohol wines. Apart from this global trend, there are strong regional differences between countries.
Top 10 markets for no-low wines
Great Britain ranks first for both no and low wines. Up to two in three British merchants expect these products to perform well. The high acceptance of wines with less alcohol is promoted, among other things, by the British tax system, which taxes these wines significantly less or not at all. For dealcoholized products, the Netherlands and Finland follow ahead of Germany with about one third of retailers approving.
In most countries, above all in Norway, the U.S., Canada, Spain as well as Switzerland, low wines are in greater demand as trend products than no-alcohol wines In the top 3 markets, retail interest is over 50%. Germany and the Netherlands have been the only markets so far where the demand for no and low wines is rated as equal by the trade. This is consistent with IWSR’s findings that Germany is the most developed market for dealcoholized wine, where the vacuum dealcoholization process was first patented in 1908.
White and sparkling wines lead the no-low category
The merchants who expected no-low wines to perform well were asked about their preferred wine types for no-low. White wines and sparkling wines are clearly ahead of rosé and red wines. One reason for this is their production process. With sparkling wines, the reduced alcohol content can best be compensated for in sensory terms by carbonation. When it comes to de-alcoholizing white wines, the industry has learnt a lot recently about the optimal requirements for the de-alcoholized base wines. When alcohol is removed from red wine, the tannins from the grape skins so typical of red wines become more prominent and have to be balanced out in a complex manner.
Top-10 sales markets for no-low white wines and sparkling wines
Markets also vary in product preferences for no-low wines. For sparkling wine,s North America, Italy and Scandinavia very much take the lead in the top 10 sales markets. 75% to 90% of merchants expect no-low sparkling wines to perform very well. This also applies to the majority of wine merchants from Austria, Belgium and France. In the case of no-low white wines, Scandinavia, the Netherlands and Germany also rank at the very top since they generally have a greater affinity for white wines. Even the traditional wine countries of Portugal and France surprisingly rank among the top 10.
Top-10 sales markets for no-low rosé wines and red wines
In general, the Scandinavian countries lead in terms of demand for no-low wines and, hence, also for rosés and red wines. Here, like in Great Britain, the lower taxation plays an important role. For rosé wines, Scandinavia is followed by Belgium and Great Britain as well as Germany and Austria. The strong performance of rosé wines in France is also evident in no-low wines. For red wine, Scandinavia is followed by the two North American countries where almost two thirds of the trade see promising prospects for no-low red wines. Even the major red wine producers Spain, Portugal and Italy rank among the top 10 sales markets for no-low red wines.
Reaction by trade and producers to no-low trend
Merchants and producers who are optimistic about no-low wines and see good sales prospects were surveyed about their current plans. Every second of these optimistic retailers would like to list new no-low wines next year. As a percentage of all traders this corresponds to 16% for low-alcohol wines and 11% for no-alcohol wines. Only 30% of these retailers do not plan to order any new no-low products because they feel their ranges are already well stocked. These results reflect merchants’ great interest, which offers particular opportunities for producers to be listed with new products.
A smaller proportion of producers who see market opportunities plan to offer new products with low-alcohol products (30%) and no-alcohol products (15%). In relation to all wine producers this means 10% for wine with low alcohol and 3% for wine with no alcohol. Some of these producers already have low-no wines in their ranges which is why 52% have not planned to change their portfolio in 2023 for the time being. However, some of these companies would like to increase the quantity of these wines produced.
Differences in production
Another reason for this rather low number of producers is the technical de-alcoholization process, which cannot be done by small and medium-sized producers on their own. The equipment required for this process are only offered by a few large, specialized manufacturers and service providers, some of which demand certain minimum quantities for this commission manufacturing. For some producers these minimum quantities are (still) too high. One solution might be for some companies from the region to have a cuvée de-alcoholized together and then market it under their own labels. Producers from the German Rheingau wine-growing region have already applied this model very successfully.
The production of low-alcohol wines can be controlled by producers themselves to a certain extent by suitable viticulture and oenological measures. Many companies reported experimenting and looking for ways to produce quality wines with low alcohol volumes. Especially countries strongly impacted by climate change, where the sugar content in the grapes and, hence, the alcohol content of the wines have already increased significantly, are active in this field. Partial de-alcoholization to lower volumes such as 5% ABV, however, requires special equipment.
Trade interest in new no-low listings
This chart below shows the percentage of merchants per country who intend to list new no-low wines – with reference to companies who regard this a trend (left-hand column) and with reference to all traders (right-hand column). Again, the difference between no and low categories becomes evident here. There is a clearly stronger interest in listing low-alcohol wines. In the U.S, for example, one in two (47%) wine merchants wants to list new low-alcohol wines but only one in twelve (8%) is looking for new no-alcohol wines. In Norway, too, this percentage is at 44% for low-alcohol wines and at 20% for no-alcohol wines. Only in the Netherlands (21%) and Germany (18%) the trade is slightly more interested in new no-alcohol wines than in low-alcohol wines.
Innovation as tomorrow’s sales driver
Industry experts expect many product innovations in the no-low beverage sector in the coming years to better meet consumer tastes and demands. For example, a no-low beverage based on wine does not necessarily have to be created by dealcoholization from wine. The first experimental products with extracts from tea, hops and other ingredients are already successful on the market, as the example of Kylie alcohol free sparkling rosé shows. In the future, the ProWein Business Report will continue to follow the trends in no-low wines.
The extensive ranges at ProWein 2023 enabled merchants and producers to taste and order new product trends. In the “World of Zero”, no-alcohol wines were a special focus at ProWein 2023.
This study was commissioned by ProWein and conducted by the Department of Wine and Beverage Business at Geisenheim University under the direction of Prof. Dr. Simone Loose. Geisenheim University is known worldwide for its research and teaching in the field of wine science.
ProWein and Geisenheim University look forward to continuing the ProWein Business Report successfully in the coming years. ProWein thus provides the wine industry with a globally unique, regular longer-term “market barometer” answering key sectoral questions in annual special topics. We would like to thank the participants of the survey and hope that wine producers and marketers continue their active participation.
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