Alcohol Industry Loses $830 Billion as Gen Z Ditches Drinks

Recent market analysis estimates that the global alcoholic beverage industry has lost approximately Ksh 124 trillion in market value between 2021 and 2025.

This decline has been widely linked to changing consumption patterns, especially among younger consumers like Generation Z.

Industry trackers attribute this slump to a broad shift in social habits, with Gen Z prioritising health, wellness, moderation, and alternative beverages over traditional alcohol consumption.

According to Whalesbook, “the global alcoholic beverage industry has experienced a substantial market value decline, estimated at Ksh 124 trillion between 2021 and 2025… coinciding with a pronounced shift in consumption habits, particularly among Generation Z.”

Why Gen Z Drinks Less (or differently)

1. Health and lifestyle priorities

Younger adults are increasingly health‑focused, associating alcohol with negative long‑term effects and opting for moderation or abstinence.

This trend has been documented in multiple studies, with experts noting Gen Z’s greater concern about well‑being compared to older cohorts.

“Today’s younger generations are just less interested in alcohol and are more likely than older generations to see it as risky for their health…” TIME Analysis 

2. Sober‑curious and alternative beverages

The rise of the sober curious movement, where consumers cut back on or entirely avoid alcohol, has helped grow non‑alcoholic drinks, mocktails, and low‑alcohol options.

These alternatives are increasingly popular with younger drinkers and fill occasions that once exclusively featured traditional alcohol.

Industry groups now report that significant percentages of younger adults are choosing non‑alcoholic options or drinking only occasionally, part of a broader trend toward conscious consumption.

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3. Social and economic drivers

Beyond health, surveys show younger demographics are more likely to favour social activities that don’t centre on drinking and are also very cost‑conscious amid rising living costs.

In several markets, shifts like “zebra‑striping” alternating alcoholic beverages with non‑alcoholic ones have materially reduced overall consumption volume.

Industry Response and Strategic Adaptations

Faced with declining demand, many beverage companies are pivoting their product portfolios:

Major producers like Bacardi, Heineken, Molson Coors, Diageo and Campari have expanded non‑alcoholic ranges and acquired or developed new zero‑proof brands.

Sales of non‑alcoholic beverages have grown rapidly, with some analysts reporting 30 % year‑over‑year increases. This is based on a report from AInvest

These moves reflect a broader push to stay relevant to younger consumers whose tastes differ markedly from past generations.

Are all markets seeing the same trend?

While much of the narrative emphasises declining consumption, the picture isn’t uniform:

Some reports suggest that overall participation rates among Gen Z (of legal drinking age) have begun to converge with general adult rates in some regions, indicating complex and evolving behaviour.

A 2025 survey of 15 key markets found a rise in alcohol consumption among Gen Z consumers in the last six months, challenging the idea that young adults have completely abandoned drinking.

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This suggests that while patterns of drinking are changing, the degree of reduction and its direct industry impact varies by region, culture and economic conditions.

What The Analysts Say

Many industry analysts frame this as less a “death” of alcohol consumption and more a restructuring of how and when alcohol is consumed, with moderation, health concerns, and lifestyle preferences playing key roles.

According to BeverageDaily.com, “Health‑conscious and digital‑savvy younger consumers are increasingly interested in non‑alcoholic beverages… requiring brands to rethink their innovation, branding and advertising strategies.”

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Consumers are increasingly opting for low and non-alcohol drinks as alcohol sector sees sales soar
PHOTO/Pubity