The sales of alcohol-free options such as beer and cocktails have exploded in recent times. The younger generations, particularly Gen Z but some Millennials are also following suit, are reducing or abstaining from alcohol altogether.
Although this may make alcohol brands feel uneasy, it’s also a good opportunity to find alternative routes into the market which also maintain lower restrictions when advertising.
Restrictions on advertising alcohol
In the UK, the ASA states that companies may not advertise their alcohol products in a way which encourages excessive drinking. Elsewhere in Europe, there are bans on all online advertising of alcohol in Lithuania and in Sweden, there is the potential of a complete ban on commercial advertising of alcohol coming into force.
In Finland, alcohol brands cannot run any type of game or contest to promote alcohol and are held responsible for moderating user-generated content created by customers, which involves their brand. Norway has a complete ban on advertising alcohol, with manufacturers able to market their products to trade customers, however, they cannot promote products directly to consumers.
These changes which have spanned across the past twenty or so years have likely minimised Gen Z’s exposure to alcohol, compared to the way that previous generations were.
Attitudes to alcohol
The radically changing attitudes to alcohol have lead to brands needing to change tact. Gen Z is divided on the topic, but overall, are seen to drink less than their predecessors, with many young people declaring themselves straight-edge even before reaching the legal drinking age.
Gen Z is concentrating on being in control of all aspects of their lives, this includes managing their online reputation, where videos and pictures can quickly go viral, as well as considering how their actions may affect their career in the future.
Those that do choose to drink, often take the route of quality over quantity. This generation savours their experiences rather than blacking out after three bottles of ‘White Lightning’ cider. They’re also more aware of the effect on both their mental and physical health, which means more members of the younger generation consider drinking to be a risky activity.
So how can alcoholic brands diversify? Considering the increased demand for premium drinks, brands should look to produce a wider range of low and no alcohol products which focus on taste and lifestyle, rather than high sugar and alcohol content.
This will require brands to move beyond a ‘low or no alcohol’ version of an existing product, and instead create new and interesting options which fit into the Gen Z belief structure. That means understanding what Gen Z demand from their brands, what inspires loyalty and how can the product fit into the overall lifestyle instead of simply being an option at the bar.
The first generation of truly digital natives are hypercognitive and have the natural ability to cross-reference sources to ensure the information they have is accurate. As a result, young people have a huge influence on their own and other generations as well as brands.
The views of this generation and their unique understanding of technology has the capability to have a significant impact on the way people think as consumers. Gen Z belief structure is anchored in their search for the truth and desires to tackle conflicts and improve the state of the world.
These behaviours have a profound effect on the way Gen Z forms relationships with brands. This means that companies need to be clued up on the three key implications for this generation, as revealed in the McKinsey study ‘True Gen’: Generation Z and its implications for companies. These are consumption as access rather than possession, consumption as an expression of individual identity, and consumption as a matter of ethical concern.
When teamed with technology advancement, this generation is able to completely evolve the consumer landscape and how brands are delivering true value to their customers, give back to the world, personalise experiences and rebalance the scale.
How can alcohol brands rebalance the scale?
In order to connect with the next generation of consumers, brands need to take on board these key influential ideas, to improve their appeal.
For brands, both big and small, this includes adapting their production to fit into a more sustainable process. This includes using reusable materials, ensuring they reduce their carbon footprint, look to use locally sourced ingredients and making sure their waste materials are being redistributed to be used in other ways.
Companies also need to address their internal processes when it comes to human resource. Gen Z wants to support brands who treat their employees fairly, wherever in the world they are located.
If companies are going to utilise labour in overseas countries, they need to have progressive attitudes to supporting their worker’s rights. This includes pressuring for better laws and legislation for LGBTQ+ individuals in countries where they are lacking and providing support internally.
It should also include paying fair salaries and providing education, child care, regulated working hours, safe working environments and accessibility to improve the overall quality of life for their workers.
Moreover, Gen Z wants brands to care about the little guys – which means supporting or funding small business projects, such as developing new products or startups developing new technology to improve supply chain, packaging and processes.
Finally, alcohol brands have been guilty of relying too heavily on outdated stereotypes historically. For brands to increase their appeal, they need to improve their representation. This includes featuring a wider variety of people in their customer-facing advertising and marketing efforts, considering gender at the forefront to battle stereotypes. Most importantly, they should ensure that this approach has been developed by a diverse team of people and tested with the target audience, gathering feedback and adjusting accordingly.
Also published on Medium.