Non-alcoholic beverages are big business in the age of “self-prohibition.”

When non-alcoholic bottle shop Spirited Away opened in Manhattan five years ago, its owner found about a dozen options to fill the shelves. Now, according to co-owner Alex Highsmith, the store stocks about 300 brands.

Meanwhile, business is growing annually at double-digit rates. Clients try to avoid alcohol — for example, experiencing “Dry January” — decide they like how they feel, and then “they keep coming back,” she said.

This sentiment has helped retailers that sell nothing but beer, wine and non-alcoholic spirits to grow as alcohol consumption declines.

Fewer Americans drink alcohol these days, and those who drink it are starting to cut down on it. Gallup said last August that about 54% of adults say they drink alcohol, the lowest rate recorded in 90 years. Those surveyed reported having had an average of 2.8 drinks over the past week, down from 3.8 in 2024 and more in previous years. This shift is most pronounced among younger Americans, with those under 25 drinking 17% less than seniors, according to research by Jefferies.

One reason for the decline: Research has shown that consumers are becoming more aware and concerned about the negative health effects of alcohol, with recent studies linking alcohol consumption to cancer. The gradual legalization of cannabis, wider use of weight-loss drugs and the embrace of health trackers may also impact alcohol use, experts said. Some believe that drinking alcohol is declining in the same way as smoking cigarettes.

“With wearables tracking every metric and glamorizing influencers, self-banning is a headwind that won’t go away,” Jeffries wrote in a recent report. “The winners are likely to be those who shape the trend of moderation, not resist it.”

‘There’s no turning back’ as booze-free business booms

Some of those who limit their consumption still want to end their day with a drink, with many looking for something that looks and tastes like alcohol but doesn’t trigger a hangover. This has created an audience for beer, wine and non-alcoholic spirits, a sector expected to be worth $5 billion by 2028, according to IWSR, an alcohol-focused data and insights firm.

Dozens of bottles and cans have appeared on store displays next to Clausthaler, a non-alcoholic beer produced in 1979. Actor Tom Holland launched Pirro; Formula 1 driver Lewis Hamilton started zero-proof tequila brand Almave; Singer Kylie Minogue has added alcohol-free bottles to her wine line.

One of NA’s most popular beer brands, Athletic Brewing, has surpassed $90 million in sales in six years. The Wall Street Journal I mentioned. The success of this sector has seen some of the largest alcohol manufacturers, such as Diageo (DEO), add free and low-alcohol options.

Alcohol-free stores say business is booming. New York City has at least two such stores, three zero-proof bars, and a $3,300-a-year alcohol-free social club called Maze. Kristen Fracco, owner of the soft drink store in Seattle, said it had nearly $1 million in sales last year.

Although many customers still consume alcohol, according to Fracco, non-alcoholic alternatives have become part of their lifestyle.

“the [non-alcoholic beverage] “The industry is not going anywhere,” Fracco said. Investopedia. “There’s no going back.”

“The effects of alcohol are no longer in vogue”

Major alcohol producers argued that booze was a victim of tightening consumer budgets, not changing cultural mores. Their executives said the youth’s behavior could be explained by their having relatively little income.

Gen Z is also more focused on mental health and socializes differently, Jeffries said. Analysts say they spend less time “going out” and more time exercising, gaming and using the Internet.

Young people are not the backbone of Cheeky & Dry’s business, Fracco said. They didn’t spend their formative years socializing with drinks in hand, so they don’t have the same motivation to buy alcohol — or, for that matter, products to replace it.

Instead, young shoppers come to Cheeky & Dry for “functional” drinks, Fracco says, including those containing non-psychoactive parts of mushrooms, hemp, kava or ingredients claimed to provide energy, mood enhancement or other benefits.

“They still want to feel something,” Highsmith said. “It’s just that the effects of alcohol are no longer in vogue.”

This article has been republished. First republished on September 14, 2025.