Zero Proof | no/low alcohol beverages

[Jane McKay]

Hi 

I'm researching the different distribution options for no/low category beverages. Can anyone help me identify online / offline, on-premise and off-premise routes to market? This is for zero-proof imported products so I need to consider the different options. I am also seeking a U.S agent to help with this.

Many thanks

Jane

[Victoria J Ho]

Hi Jane, the interest in zero proof in the US has certainly skyrocketed in the past 2-3 years, which makes entering the category as exciting as it is harrowing. As I'm sure much of your research has revealed, the biggest challenge facing distribution of your product is in distributor/buyer education on the true demographic and expanding use occasions for the category. If you flip the definition of challenge to "opportunity," then I think the key question that your team strives to answer is which core distribution channel will best utilize your sales and marketing dollar: D2C, foodservice (hotels, restos, airports, cruise ships, college campuses, vending machines), alternative retail (think: Cost Plus World Market, BevMo or Williams Sonoma), grocery (conventional, natural or specialty), and so on. Identifying a channel may help you craft a more compelling pricing strategy while also giving you a packaging strategy to focus on in the situation that your beverages are best presented in 4-pack caddies, standalone, gift sets, 12-pack fridge cases, etc. I don't know what format (can, bottle, multi-serve, net contents, twist cap, etc) your product has, but different retailers respond more positively to different formats. 

One route is to approach traditional distributors in the food and beverage category who would have the proper retail permits AND the buyer relationships to sell you into anchor accounts. Alcohol and wine distributors tend to have a difficult time working directly with grocery stores because they lack all the necessary permits. You would be positioned as an innovation that serves a trending white space...a consumer need that is unlikely to fade as people continue seeking wellness options across all generations. One you've caught the attention of a buyer and are in the store, they can merchandise where you make the most impact.

An alcohol and wine distributor has its own benefits, since you would be giving them an option for their portfolio that doesn't cannibalize any of their existing brands; however, the margins on your product may also be much lower, and when push comes to shove, many account reps will spotlight topsellers. One really intriguing option would be a focused NON-ALCOHOLIC BEV distributor, like New York's PROOF NO MORE Distribution Co., which specializes only in zero and no proof bevs.

A few online platforms: The Zero Proof, NA Craft Beverages, Total Wine and More (also sells alcoholic bevs), Drizly, Amazon and of course your own website if applicable. This is nowhere near a comprehensive list, and may not entail huge POs in one fell swoop, but a solid step for gaining exposure for a new brand without having to worry too much about last-mile fulfillment. If you have a tight product sheet and a clear pitch, there's great potential in reaching out and building relationships from the ground up.

For brand exposure and meeting key decision makers in a cost-effective and efficient way, tradeshows (beverage specific or specialty food) and discovery platforms like RangeMe and SFA's Infinite Aisle can be a huge asset to a lean team.

And one parting emphasis on positioning: very few products are built "for all people;" and in most cases, emerging brands are more successful when they brilliantly fill an unmet need and help pioneer or galvanize a category (i.e. kombucha, a fellow low ABV product and a personal obsession  ). However, with zero proof beverages, it's fascinating to read the data on who is drinking it and to remind buyers that the demographic is not just people who don't drink alcohol. The most robust demographic is actually social drinkers who are making daily health more of a priority, and switching between zero proof and traditional drinks or seltzers regularly. Both younger generations and boomers want to live it up without feeling slowed down, and being vibrant and buzzy is a casual weekday event. If your product has a culinary component like special flavors, botanicals, spices, etc. or carries a very strong heritage from its country of origin, that's another way to celebrate the experience that your line is adding to the shelf.

Cheers!

 

 

 

https://www.forbes.com/sites/katedingwall/2022/01/31/meet-new-yorks-first-non-alcoholic-spirits-distributor/?sh=5e1bc5ed78a2

Edited May 16, 2022 by Victoria J Ho