The new No-Reality

Studies confirm that consumers are cutting back on alcohol consumption. Increasingly, they are turning to alcohol-free alternatives, as highlighted by research from the International Wine and Spirits Record (IWSR). This trend is expected to intensify over the coming years, with younger generations in some cases adopting a fully abstinent lifestyle – a development supported by numerous studies. At the same time, evidence from markets such as the UK suggests that consumers may even switch between alcoholic and non-alcoholic drinks on the same occasion – a behavior referred to as “zebra striping.”

This makes a closer look at the alcohol-free segment all the more important. Alcohol-free wines and sparkling wines are no longer just fallback options for drivers or expectant mothers – they have firmly entered the mainstream.

Growing Market

The IWSR forecasts that the market for alcohol-free beverages could reach USD 4 billion by 2028. A study by Meticulous Research, based on data from major players in the wine industry, values the alcohol-free wine segment alone at USD 1.21 billion in 2024. By 2032, this figure could rise to USD 2.61 billion – with annual growth rates of around 11 percent.

The potential is clear, and growth is dynamic. Nevertheless, alcohol-free wine remains a niche product, with an average market share of less than 1.5 percent. Sparkling wine demonstrates what is possible in Germany, arguably the most advanced market for alcohol-free wine: according to Circana, the market for de-alcoholized sparkling wine grew by 7 percent in 2024, with the category now accounting for a 5 percent market share (Nielsen data).

Outside Germany, leading producers are also seeing strong developments. Spain’s third-largest wine company, Torres, was one of Europe’s alcohol-free pioneers. As early as 2008, the company launched its “Natureo” brand. Today, Torres produces eight alcohol-free wines – in addition to “Natureo,” also alcohol-free versions of its “Sangre de Toro” and “Viña Sol” brands.

“In 2024 we sold 3 million bottles of alcohol-free wines, which represents around 10 percent of our total sales. Germany is one of our key markets, alongside the Netherlands, the UK, Canada and the Nordic countries. Spain is still a relatively small market, but it has recently shown very positive growth,” says Innovation Director Mireia Torres.

The dynamism of the category is also evident at ProWein: since 2023, visitor interest in alcohol-free wines has grown steadily. The latest visitor survey shows that 41 percent are interested in alcohol-free wine, and 37 percent in alcohol-free sparkling wine.

Even international celebrities – long active in the wine game – have jumped on the alcohol-free bandwagon. According to a report by London-based law firm Charles Russell Speechlys, pop star Kylie Minogue’s alcohol-free rosé sparkling wine is now considered “the UK’s top rosé brand.” Whether or not this is strictly accurate, one thing is certain: such brands bring added image and attention to the category.

Industry Sees Potential

The growing interest and potential are documented in the ProWein Business Report, which is compiled annually by Geisenheim University on behalf of ProWein. More than 1,300 industry experts from production and trade in the most important producer and sales markets are surveyed for this report.

38% of respondents expect alcohol-free wines to perform strongly by 2026. For wines with reduced alcohol content, as many as 65 % anticipate positive development. Other innovative alcohol-free alternatives, such as those based on tea or kombucha, are also expected to gain ground, according to 32 % of the experts surveyed.

The still young category of proxies is making a confident entrance, commanding premium prices – but also delivering bold and often experimental flavors. Examples include the German brand “Von Wiesen” with its verbena and quince creation, or Copenhagen Sparkling Tea’s effervescent blend of green tea and citrus fruit.

Agreement of industry experts in %

“The ProWein Business Report shows that industry experts see great potential in these products. While they remain a niche, they function as a valuable complement. Many also highlight their advantage in being positioned as a cultural product with tradition – only without, or with less, alcohol,” explains Professor Simone Loose, head of the study.

Major companies are investing accordingly. Moët Hennessy – Louis Vuitton (LVMH), the global market leader in sparkling wine and an experienced player in the lifestyle and luxury segment, announced its entry into French Bloom in 2024 – an ultra-premium alcohol-free sparkling wine brand that has successfully positioned products at price points exceeding one hundred euros.

Spanish producer Torres is also sparing no expense: “For the period 2024 to 2026, we are investing around six million euros in the construction of a new facility dedicated exclusively to de-alcoholized wines, in order to expand our production capacity,” says company director Mireia Torres.

And the developments extend beyond Europe: in Australia, Treasury Wine Estates recently opened a new production facility in the Barossa Valley dedicated exclusively to wines with no or low alcohol. The project involved an investment of around ten million US dollars. Using new processes that have already been submitted for patent approval, the company aims to achieve even better aromatic results.

Copy or original?

The sensory quality of dealcoholized wines remains a challenge. It is difficult to achieve a close resemblance to the original, and the lack of flavor is often masked with sugar or flavorings. However, technological advances are increasingly leading to better, more “authentic” results.

This is precisely the goal of many manufacturers such as Henkell Freixenet: “In addition to brand strength, it is important for alcohol-reduced or alcohol-free products to have an attractive flavor profile that is close to that of the alcoholic product, as well as to preserve the fine taste and delicate bouquet notes of the base wine in order to offer consumers a high-quality taste experience,” says Head of Communications Vanessa Lehmann.

For others, however, the question arises: Does dealcoholized wine even have to taste like wine? “No,” says producer Markus Bonsels from the Bibo Runge winery in the Rheingau (Germany). He now sells his non-alcoholic wine “Deserteur” in 15 countries. “Alcohol-free wine is a drink in its own right, not a copy. It has to be a really good drink that inspires customers – but not because it tastes exactly like the wine they know.” In this way, completely new target groups can also be reached.

Frederike de Groot agrees. The Dutchwoman runs the company World of Nix with her business partner Wim Boekema – a B2B and B2C business exclusively for non-alcoholic beverages. Founded in 2021, it gives

Major suppliers have long since expanded their best-selling brands to include alcohol-free variants, such as Diageo with “Tanqueray.” Other companies, such as Lyre's, focus exclusively on 0.0% and even create alcohol-free whiskey alternatives.

Of course, price also plays a role. Ulf Sjödin MW, Head of Category Management at Swedish monopoly Systembolaget, reports: “Taste is the most important factor for our customers when it comes to non-alcoholic wines. We have also tried some more expensive ‘fine wines’ in this segment, but there is limited interest in spending more than €10 on a bottle of non-alcoholic wine.” Alcohol-free wine still only accounts for 0.7 percent of Systembolaget's sales, but in terms of revenue, this amounts to around 16 million euros – “which means that alcohol-free sales are not insignificant,” says Sjödin.

For producers and marketers of alcohol-free products, the signs clearly point to growth. The important thing now is to accurately assess the market and, above all, the target groups, and to design the offerings accordingly. This is because the alcohol-free segment, with its different product categories, is much more complex than the familiar classic wine segment.