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While we always see cultural and behavioral shifts between generations, Gen Z substantially stands out.
Aside from their media consumption, how they learn their news, and workplace preferences, those falling into the Gen Z segment have created a splash in the alcohol industry—causing a major ripple (or tsunami?). Of course, only those in the beginning years of the generation, from ‘97-’03, are of legal drinking age, but that subset of consumers is impacting the industry as a whole. In the next 10 years, millions of Gen Z consumers will enter the adult beverage space from Gen Z, bringing forward their diverse voices and socially conscious values.
As a ‘97 baby, I can attest to these preferences firsthand. First, let’s dig into the research on successfully reaching this audience with thoughtful marketing strategies. I’ll provide my take as a marketer and a card-carrying member of this sober-minded community along the way.
Every generation has historically consumed less alcohol than the one before it. Gen Z showing the largest gap, consuming a whopping 20% less than Millennials. This statistic will come as no surprise to alcohol brand managers and everyday consumers alike.
We’ve seen many lower-ABV beverages rise to the surface over the last few years, from hard seltzers to alcohol-removed wines. In fact, 38% of Gen Z said they’d be willing to try non-alcoholic drinks, a much higher percentage than any other age group.
With so many options available, the societal pressure of holding a beer at a social gathering diminishes. Plus, many social interactions now exist online, from Discord groups to virtual friend meet-ups, and alcohol is no longer the focus of hangouts.
The share of Gen Zers who plan to drink less alcohol in 2024 rose 53% year over year. So, what is causing this large decrease in consumption? This generation has grown up alongside social media—a place that facilitates open dialogues surrounding mental health.
We’ve seen a trend in wellness-focused lifestyles across platforms, prompting the younger demographic to exercise caution with their drinking habits as they recognize the potential adverse effects of alcohol on psychological well-being. 86% of Gen Z consumers believe that their mental health is as significant as their physical health when considering drinking alcohol. Social media influencers frequently document their participation in challenges like "Dry January," exercise regimens, and “clean eating,” motivating their audience to embrace comparable lifestyle changes. Let’s be real: I see many of my peers gravitating towards those lower-calorie beverages (put dead center on the front of the can.)
Ways of unwinding and socializing have changed, with this generation often showing a preference for activities focused on personal development rather than excessive drinking. Google research in 2019 showed 41% of Gen Zers associate alcohol with “vulnerability”, “anxiety” and even “abuse;” showcasing the negative sentiment with what was once a “right of passage” into adulthood (or turning 21).
Researchers from Carnegie Mellon University followed 234 heavy-drinking young adults between the ages of 21 to 29 from February 2018 to March 2022 to determine how the COVID-19 pandemic affected their drinking habits. They found that during and after the pandemic, participants, on average, consumed 12.8 fewer alcoholic drinks a month than before the pandemic. This study shows the cultural shift that happened due to the pandemic, likely due to isolation during lockdown that created a slower-paced lifestyle for younger consumers’ weekends even after the fact.
My friends and I would much rather have a picnic or go paint pottery than socialize at a bar. I thought this shift was more unique to me and my social circle, but it turns out most of my peers also lean towards leisure. Pinterest searches are up 466% for “Bridgerton tea party” and 177% for “High tea food ideas.” I guess we are all seeking joy through whimsical outlets - and a heavy pour of a vodka soda doesn’t constitute “light and airy.”
Aside from health concerns and cultural shifts, Gen Z is feeling the heat of financial burns. Go out for drinks? In THIS economy? From student loans to the housing market to the rise of everyday costs, there is less to spend on alcohol-motivated endeavors. While this generation is more likely to splurge on groceries (pointing back to their health consciousness), boozy beverages are not typically included in the cart. I focus my shopping trips on things that bring benefits (in-season fruits, hydrating seltzer waters, etc.) over alcohol.
Around a third of people aged 18-24 do not drink alcohol at all, but those that do drink tend to do so primarily as a treat, to relax, or to mark a special occasion. Knowing this, brands can reach consumers by highlighting these micro-moments that fit into their everyday lives. Specific brands and products often hold their own association in the consumers' eye—like sparking wine, for example, used to celebrate milestone moments or everyday wins. It’s key for brands to understand their user sentiment and audience behaviors. Through extensive research and social listening, we uncover motivations for purchasing and focus on audience-first strategic positioning.
What is Gen Z grabbing off the shelf? A Statista consumer goods report shows that 25% of the market share for spirit-based seltzers is attributed to consumers aged 21 to 34, more than any other age group. This is typically a lower calorie and lower ABV option. Studies show a preference for flavored beverages and a bonus if they provide benefits (like kombucha).
Leave room to experiment with marketing strategies to find what resonates. This generation is less interested in the unachievable aesthetic and more focused on authentic content. Elevate the consumer’s mocktail game with a fun recipe, partner with relevant influencers, or show off a realistic scene with your product. We see a lot of nostalgia playing into consumer purchases, including collaborations with memorable brands. If not a full partnership, how can your brand engage with little pieces of sentiment to further connect with these consumers?
Gen Z places a significant emphasis on values and ethical considerations regarding purchases. This generation demonstrates a heightened level of concern regarding a brand's ethical and social positions compared to prior generations, leading them to gravitate towards brands that align most closely with their personal principles. 57% of Gen Z individuals have stated they would intentionally select brands promoting positive values and ethical business practices. In general, I don’t think people associate alcohol brands with social responsibility. Knowing that this group is not brand loyal, this is a great opportunity for brands to stand apart by connecting with consumers on their shared values. I’d be much more likely to grab a case of seltzers that send proceeds toward a foundation I support or see as inclusive in their social media presence.
Furthermore, data from Drizly indicates that Gen Z consumers disproportionately support brands owned by individuals from historically marginalized or underrepresented groups, exhibiting a notably higher propensity to purchase products from women-owned, Hispanic-owned, and AAPI-owned brands.
Personally, I probably have dozens of mocktail recipes saved in my IG account. I keep my fridge stocked with Fresca and lemonade over beer, but have a posh bar cart (is that too Millennial?) stocked with bottles collecting dust. If I choose to drink, it is something that has really captivated me, maybe a cheeky social media post, eye-catching packaging, or relatable values.
The trends I researched come as no surprise to me, as I watch them unfold first-hand in front of me with my friends regularly. I finished college right as the pandemic hit - The slow return to normalcy changed everything about how we socialize. If nothing else, the research shows the heaviness of the world and my generation’s need to create meaningful joy and connections; escapism should be centered around our experiences with one another and less about drinking alcohol to cope.
So, while the alcohol industry may be changing, there are still opportunities for brands to connect with Gen Z consumers; it may require different marketing strategies than what’s worked in the past.
