Health and Science

Heineken to introduce nonalcoholic beer nationwide as health-conscious consumers ditch beer

Key Points
  • Heineken will introduce Heineken 0.0, a nonalcoholic beer, nationwide in January.
  • Heineken thinks it can reinvigorate the category if it can give people more opportunities to drink beer.
Heineken introduces alcohol free beer.
Source: Heineken

Heineken will soon launch a nonalcoholic version of its namesake beer in the U.S. as consumers seek out healthier options.

In January, Heineken will introduce Heineken 0.0 (pronounced zero zero) nationwide. Heineken, the world's second-largest brewer, first launched the beer in Barcelona in May 2017 and has since rolled it out in more than 30 countries.

Consumers are increasingly shunning beer and instead drinking wine, spirits and hard seltzers, which they perceive as healthier than beer. Others are drinking less and some are dropping alcohol altogether. Heineken thinks it can reinvigorate the beer category if it can give people more opportunities to drink it.

"It's not about a replacement strategy, it's complementary," said Jonnie Cahill, chief marketing officer of Heineken USA. "Sometimes I drink Heineken. Sometimes I drink Heineken 0.0. ... So what we see happening is that this is in addition to our own Heineken position. We see this as an 'and' not an 'instead of purchase.'"

The U.S. market for nonalcoholic beer has been relatively small, with Anheuser-Busch InBev's O'Doul's being the most well-known brand. But it and other nonalcoholic beers have become somewhat stigmatized. Heineken hopes to market 0.0 as similar to traditional Heineken just without the alcohol, making it an option for any situation.

To highlight this, Heineken will advertise new occasions for people to drink beer, including after a workout or during an office lunch. The beer contains 65 calories, below even light beers like Anheuser-Busch's Michelob Ultra, a brand that has successfully positioned itself as an option for health-conscious consumers.

Between 2016 and 2017, Michelob Ultra's volume sales rose about 21 percent in the U.S., according to Euromonitor International. That's as volumes for the overall beer category fell 0.6 percent in the U.S., according to the market research firm.

Making beer taste good without alcohol is challenging. Fermenting yeast naturally produces alcohol, which helps give beer its flavor. The main techniques to make nonalcoholic beer are to prevent yeast from producing alcohol or to remove alcohol at the end.

These processes can leave beer tasting not quite right. To make Heineken 0.0, brewers remove alcohol but then add back in the fruity aromas that are stripped out along with the alcohol. These aromas give Heineken's beers their taste and smell, said Heineken's global brewmaster, Willem van Waesberghe.

As for the taste, he said, "it's a little different, but it's really close to a good beer. I'm talking as a brewer. As a consumer, I'm really, really happy about it."

In the United Kingdom, Heineken increased its share of the no-alcohol beer category to 10.4 percent for the year through May from 2.5 percent at the same time last year, according to Nielsen figures provided by Heineken. By volume, nonalcohol beer sales have grown nearly 24 percent while alcoholic beer volumes grew 0.2 percent in the same period.

Heineken cannot forecast growth in the U.S. since it's a completely new market for the brewer, Cahill said. Heineken has not even tested the beer in the U.S.

"I can't say where this for sure this turns out, but I can say for us this isn't a January to March go," Cahill said. "We believe the consumer's ready. We believe this is good for beer, and we're going to go for it. So I don't see us blinking anytime soon."