Why are non-alcoholic drinks so expensive?

Most of us have complained about the price of drinks, particularly in bars and restaurants. But when it comes to a good bottle of wine or a top-quality spirit, we usually pay it anyway. After all, paying a premium for alcohol is normal. We've been subjected to years of marketing that convinces our subconscious selves that alcoholic drinks are somehow glamorous and fun. But times are changing.

Premium alcohol-free drinks have joined the market and they've got us all asking, "Why are non-alcoholic drinks so expensive?" We take a look at why we all accept the price for alcoholic drinks, the production costs associated with alcohol-free offerings and what else makes them so expensive. Then we ask the burning question, "Are people really willing to pay high prices for drinks containing no alcohol?"


Why do we pay so much for alcoholic drinks?


The simple answer to the question of why we pay so much for alcoholic drinks is because it's "normal". It's what we've got used to and we accept that those are the prices. After all, production costs can be high! Starting with premium ingredients, then there's the labour that goes into producing the liquid. Then it has to be aged, packaged, marketed and distributed to both shops and restaurants. Then of course shops, bars, and restaurants need to make a profit AND there's tax to consider.


For decades, we have been accepting these costs because that's just the way it is. We expect to put aside a reasonable amount of money for dinner and drinks. Spend well into double figures for a good bottle of wine and even more when it comes to spirits. We generally associate higher percentage proof with a higher price tag. So, what happens when the alcohol is removed?


In reality, the cost of production isn't far off that of alcohol. But in our minds, non-alcoholic means coca cola, lemonade or soda water. Perhaps an orange juice or sparkling apple, something you'd usually buy at the pub for children. So, when we take fabulous wines and remove the alcohol, or distil spirits without the need for booze, is the price tag a step too far? It shouldn't be, and here's why.


Noughty rouge dealcoholised red wine displayed in front of a fire against a black background to symbolise why alcohol free drinks are so expensive


How are non-alcoholic drinks produced?


Let's start with the ingredients. It is generally accepted that we're after some sort of buzz, warming feeling or relaxing sensation when drinking alcohol. So, it's not all about the flavour. When it comes to alcohol-free drinks though, it is ALL about flavour. Zero-proof drinks may contain ingredients like saffron, samphire or vanilla. I'm not sure how much you know about raw ingredients but let me tell you, those things are PRICEY.


Then, you move on to production. Did you know that drinks like Feragaia and Pentire are distilled in the same way as whiskey and gin? And when you're making a zero-proof drink, you can't just walk into a regular distillery and ask them to get cracking. Try strolling up to a master distiller and asking them to create you something non-alcoholic. The chances are you'll get laughed out of there. So, you have to set up and make it yourself.


Bottles of Feragaia non alcoholic Scottish distilled spirit produced in the same way as whiskey making it an expensive non alcoholic drink displayed in a triangular formation


What else makes non-alcoholic drinks so expensive?


Once you've manufactured the drinks, there's the bottling, labelling and distribution. All more expensive when you're a small producer, which most alcohol-free drinks manufacturers are. And what about marketing? Where do zero-proof drinks even fit on the shelves? With their alcoholic alternatives, with the soft drinks or in their own section entirely?


As a completely new market sector, zero-proof drinks are starting with nothing. Additionally, their marketing budgets are likely in the same ballpark as their alcohol content. After all, how many start-up businesses have the money to kickstart an entire sector?


Another issue is setting themselves apart from the alcohol-free drinks that would usually be on menus. Mocktails full of juice and sugar. Fizzy pop aimed at children. When we're not consuming alcohol on an evening out, many of us don't even check to see if there's anything decent to drink. Ordering a soda water or coca cola comes as second nature.


But those of us who do take the time to check will be noticing a subtle sea change. Many upmarket restaurants are doing better. Offering high-end alcohol-free wines, non-alcoholic gin and tonic and even Scottish distilled spirits. And with premium zero-proof drinks come premium prices. Prices we need to get comfortable with.


Are people really willing to pay high prices for drinks containing no alcohol?


Whilst the premium alcohol-free drinks market remains in its infancy, the abstention movement is gaining pace. Gen-Z in particular have grown up seeing the impact of drunkenness splashed over social media and it has left a bitter taste in their mouths. As a result, many of us are sober-curious or at least drinking more mindfully these days. With greater numbers of non-drinkers comes more pressure on bars and restaurants to provide premium alternatives.


New zero-proof manufacturers are popping up each year providing alternatives to wines and spirits. Those of us with an outdoorsy lifestyle are realising that hiking up a mountain doesn't bring the same joy with a banging headache. Hard workers want to arrive at the office ready to work, not take painkillers. Yet most of us are not willing to give up our sociable evenings.


Such factors have caused a perfect storm in the alcohol-free drinks world. As a society, we want delicious, premium alcohol-free drinks. Some brave souls have taken on the challenge of creating them and we are more than willing to pay the asking price.