Is Alcohol Dead?

Trends in the CPG industry are showing a lot of assumptions about GenZ’s alcohol consumption. Let’s break down some of alcohol’s challengers and discuss what’s changing in the substance market with new alternatives from Kava to THC seltzers.

Historically, alcohol has been the de facto drug of choice for Americans of every age group, so much so in fact that some hardly even consider it a drug at all due to its ever-present influence in our culture. These days, things seem to be changing. The market is flooded with alcohol alternatives that provide safer, healthier, and better ways to get “buzzed.” Founders in this alternative beverage space are going to market with the assumption that alcohol is falling in popularity. Let's briefly dive into some of these new substances and consider whether they are worth all the hype.

#1 Mushrooms:

By mixing properly dosed and carefully curated selections of mushrooms into everyday food and drink, a new class of consumer-friendly superfoods is emerging. New drinks, serums, and powders are being sent to market daily as more and more people embrace the powerful healing effects of these once-overlooked health panaceas. The combination of inspiring branding and effective adaptogenic properties is driving consumer interest, but we’re skeptical that wine & spirits brands need to contend with the competition. 

Considering the variety of mushroom classes and their effects, mushroom-infused products can be marketed as daytime, social, or relaxation products.  Cordyceps are known to be mood boosters and Reishi is a known sleep aid. These brain-boosting shrooms won’t make you trip** but many users report nootropic properties ranging from stress reduction to ADHD symptom management and alertness. Mushroom blends are also being added to coffee to supplement its stimulating effects while providing a healthy boost in the morning. Considering the uses and benefits, we believe that mushroom products can be used as an alternative to alcohol but should not be considered broadly as a replacement.

Mushroom products are lifestyle enhancers. One of the greatest advantages that mushrooms have over other alternatives is their sheer versatility and ease of use. Each species of mushroom has specific and differentiated effects, allowing careful mixing and matching to target specific health goals and provide exactly what kind of experience is desired. Brands selling mushroom products must consider when, where, and why people are consuming mushroom elixirs. Considering how the product enhances the day-to-day will result in effective branding. 

**Psychedelic mushrooms have yet to enter the market substantially, but when they do, we will be very curious to see the results as 46% of people aged 18-22 have tried psychedelic mushrooms.

#2 CBD/THC/Delta-9/8:

Cannabis is the most widely consumed drug, behind alcohol. New brands in this category tend to go to market with the assumption that alcohol is gradually being replaced by cannabis products in consumer behavior. THC is illegal in over half the US, so brands have been producing Delta9 and Delta8 THC edibles ranging from elixirs to gummies. Derived from hemp plants, Delta products, as we’ll call them, are psychoactive and can often produce more intense highs than regular cannabis. 

We’re seeing a lot of products marketed as ‘social tonics’. The majority of these tonics feature Delta9 THC. Delta products are the closest contenders to competing with alcohol but we are skeptical that they can be considered a replacement and we have concerns about product-market fit across the board for brands that choose to step into the unstable territory that comes with producing hemp derivatives. 

Consistency, consumer expectations, and precise branding are issues we’ve noticed across the board for Delta products. Regular cannabis users pretty much ignore Delta9 products. The ideal target customers for Delta products are those who use cannabis no more than once a week. 

The setting in which people are consuming Delta products is also often misconstrued. People are more likely to consume these products on their own as opposed to in social settings. This finding has led us to believe brands in this space should lean more into the personality of their brand emphasizing how the product can be there for those who love it… after work, before meeting the in-laws, and relaxing at home are all likely scenarios for regular consumption. These scenarios are common use cases for alcohol consumption so alcohol brands need to pay attention to market trends in cannabis-related beverages. 

#3 Kava 

This traditional Polynesian drink is made of ground Piper methysticum roots, known for its relaxing, uplifting, and meditative properties for centuries. In recent years, it has become something of a global phenomenon. Users report feeling less socially inhibited and far more positive, some of the most common and sought out effects also reported in alcohol use–without the hangover! Kava, like the others on our list, leaves no hangover the next day, no long-term health complications, no lack of control, or poor decision-making while under its influence. In fact, not only does it leave no hangover, it serves to make you healthier, as it is yet another adaptogen, helping to reduce stress and improve bodily functioning.

The reason behind this adaptogenic effect is mainly rooted in a class of molecular compounds known as kavalactones, which are found within the plant. There are a multitude of such compounds, but six main ones have been identified as the most important for producing the effects the drink is known for. The concentrations of these compounds can vary wildly between different cultivars. Like mushrooms, kavalactones target specific emotions or effects allowing for plenty of experimentation and discovery. Most importantly, these six compounds possess a wide range of health benefits, most notably: stress relief, muscle relaxation, sleepiness, and feelings of wellbeing. It's not often you can enjoy a nice healthy glass of tea and get buzzed for your troubles. It's one of those rare times where you really can have your cake and eat it too. 

We’re excited to see how brands get creative with flavor profiles and mixing concepts. Kava is a great alternative for alcohol but its unclear it can meet the consumer demand presented by the data in GenZ drug and alcohol habits. 

So is alcohol really dead then? 

While it's clear that there is a lot to explore in the world of alcohol alternatives, the simple question of “is alcohol dead?” actually turns out to be a resounding NO. A recent survey conducted by our team found that nearly 85% of college-aged students consumed alcohol on a weekly or monthly basis with an additional 5% percent reporting daily use. 

This figure may surprise you given the exhaustive list of aforementioned health benefits, but the cultural significance and the levels of intoxication possible cannot be understated or undermined. Alcohol dominates the social space. Cannabis and other drugs such as nicotine are commonly used as supplements to social drinking, thus we call them lifestyle enhancers.

Rather than outright replacing alcohol, the going trend for ‘alternatives’ is lifestyle enhancement. All of the items listed above can help to either improve a buzz, cure the hangover the next day, or provide an added vibe to day-to-day activities. Next time you go to pick up a six-pack (or a handle of vodka), grab a little something extra from our list and see what happens. Worst case scenario, you’ll be out five bucks and feeling healthier for it the next day.