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Gen Z consumers are thirsty for variety in beverages

As Gen Z consumers gain disposable income, they are looking to quench their thirst with beverage brands that are clean, sustainable and socially responsible, according to a report from the global consumer trend forecaster WGSN.

Additionally, the report found that these consumers favour discovering functional drink brands in the digital space as well as drinking less alcohol or abstaining entirely.

The priorities that are driving the choices made by Gen Z consumers when selecting beverage brands are similar to those driving their purchases of food products across the spectrum

Alcohol-free stress reduction

One of the major trends is Gen Z consumers' interest in consuming less alcohol. A Berenberg study cited by Insider found that people in their teens and early 20s drank over 20% less per capita than Millennials did at the same age. Another study by YPulse found that in Western Europe, 23% of this cohort never drink and 33% are making a conscious effort to limit the quantity of alcohol they drink. Asia has seen a similar trend with over 80% of younger consumers in China prefer ‘light drinking’, according to NetEase.

This trend away from alcohol begs the question, “What are Gen Z consumers drinking at social gatherings?” According to WGSN, the answer is beverages with ‘psychedelic’ mood-boosting ingredients such as kava, cognitive-enhancing nootropics and CBD infusions.

This trend toward low- and no-alcohol has gained such steam that WGSN is predicting “a boom of alcohol-free shops around the globe.”

Health and wellness are the watchwords

Conventional beverages like soda and sugary drinks are perceived negatively by Gen Z consumers — a 2018 report from Mintel found 50% of Gen Z believed drinking soda specifically is unhealthy. Similarly, the word ‘diet’ has fallen out of favour as its connotation is tied to unhealthy diets and warped body images. Brands have responded by rebranding ‘diet’ options as ‘zero sugar’ such as PepsiCo, Keurig Dr Pepper and Coca-Cola. 

However, hydration remains important to young consumers. Instead of sports drinks and soda, tea has begun to increase in popularity. Similarly, functional beverages that are fortified with electrolytes, vitamins and other functional ingredients are in demand.  

As Gen Z consumers continue to age and become a larger proportion of the consumer base with disposable income, their preferences will continue to influence the evolution of brands, says WGSN.