Counterintuitive Data-Powered Insights Can Drive Top-Line Growth

The biggest consumers of low-ABV or nonalcoholic beverages in the U.S. are alcohol drinkers. 

That reality may seem counterintuitive. Conventional wisdom would suggest the bulk of those drinking these products desire to remain sober. 

However, The Wall Street Journal recently reported that 80% of people buying Athletic Brewing’s beverages still consume alcohol.  

For context, Athletic Brewing is the top brand by sales in the fast grow nonalcoholic beer category (think: $90mm in ’23). The company raised a $50mm investment round this past summer at an $800mm valuation. 

Athletic Brewing claims that most customers consume its product as a ‘spacer’ rather than as a ‘replacer’. In other words, they drink these nonalcoholic beers in between, or alongside, alcoholic drinks.  

Aramark’s research validates that assertion. The publicly traded food and facilities service provider found that sports fans are increasingly consuming nonalcoholic products as “second drinks”. 

That insight represents a larger opportunity for sports properties, and it shows how teams and leagues can leverage data to defy preconceptions and challenge ‘common sense’ narratives. 

The rapid growth of the nonalcoholic drink category has generally been viewed as a mixed bag by sports industry insiders.  

On one hand, the sector’s 20% compound annual growth rate has made companies playing in the space natural targets for large-scale partnerships and ad sales (see: Heineken using Formula 1’s global platform to promote its 0.0 product or the brand’s Super Bowl LVII commercial). And the demographics of those consuming nonalcoholic beverages seemingly align with the profile that rights owners and rights holders are eager to reach (think: 21-34). 

But on the other, stakeholders across the industry have been concerned that the continued growth of the category would eventually begin to eat away at alcohol sales. 

So, traditional alcohol companies have thought twice about promoting alternative products with their portfolios. Many have also been hesitant to invest meaningful partnership dollars in a niche that still only makes up 1-2% of the total category spend. 

And sports properties and rights holders have been slow to carve out nonalcoholic beverage sponsorship opportunities. Remember, the beer companies are among the industry’s biggest advertising spenders. If their businesses suffer, a decrease in revenue could follow. 

Existing corporate partners often reserve the nonalcoholic drink classification as part of their partnership deal too. So, for some, it hasn’t even historically been feasible. 

Athletic Brewing and Aramark’s data/findings should alter perceptions about who consumes nonalcoholic beverages and how they are being used. It has become evident that these products serve as an incremental opportunity to sell to alcohol consumers. 

That reality should alter how sports industry stakeholders structure their beverage category deals in the future. And it will likely serve as a catalyst for traditional alcohol brands to sign new or expanded partnerships promoting the consumption of these low-ABV or nonalcoholic beverages, either with their own offerings or in cooperation with a company like Athletic Brewing.  

Savvy rights owners and holders would be wise to explore how they can help activate these tie-ups in-venue, on digital, on social, or with event, and/or hospitality assets (think: samples being provided at alcoholic beer points-of-sale). Those that are effective can drive per-cap increases. Aramark found that sports fans will pay more for a nonalcoholic beer than a traditional soft drink.  

Transitioning people away from booze and towards nonalcoholic beverages should also lead to an improved in-stadium fan experience–and help to make sports more family-friendly, again. Excessive alcohol consumption is often associated with many of the security issues that plague live events (think: fights, belligerent behavior). 

Ultimately, a better/safer experience could lead to an increase in the number of young fans in attendance and more tickets sold. 

While Athletic Brewing and the nonalcoholic beverage category presented a timely reminder, there are countless examples of data being used to upend conventional wisdom across sport. 

• Women’s Sports - Did you know that men are as, or more, likely than women to be fans of women’s sports? A recent survey conducted for The Athletic found that 88.7% of male soccer fans consider themselves supporters of a women’s club. 

• Toys – Circana, the market research firm formerly known as NPD Group, found that 25% of all toy sales are now made, not by parents for children, but by adult collectors.  

• Exercise – The rise of GLP-1 drugs, such as Ozempic and Wegovy, has proven there are more successful ways to lose weight than exercising. 

Once a counter-intuitive insight has been uncovered, it is critical to act quickly on the finding to maximize profits. Sports’ industry leaders are increasingly looking for ideas befitting a similar profile and brand partners often have limited budgets to spend. 

Below are a few of the ways sports properties can go about leveraging the counter-intuitive realities referenced.  

• Women’s Sports – The NFL has enjoyed more success selling apparel that fits the female fan’s body in standard team colors than it did when it took a ‘shrink it and pink it’ approach. Similar logic about sizing and colors should be applied to male fans of women’s sports teams to effectively sell merchandise. 

• Toys – Sports rights holders and licensors should explicitly create or bring back retro-themed merchandise targeted at adult buyers (think: Starting Lineup action figures). E-commerce, social media, and influencer marketing can all help to accelerate product sales. 

• Exercise – Rights owners view participation as a growth engine. So, leagues and teams would be wise to actively promote how playing their sport improves cognitive (think: memory and thinking skills) and emotional functions (think: mood), and offers participants benefits above and beyond any weight loss that might occur. 

There is no shortage of contradictory insights waiting to be unlocked, or ways to take that knowledge and profit on it (see: NWSL club valuations). Industry leaders should make sure to use all the information at their disposal when exploring the validity of counterintuitive findings to avoid going down the wrong path.