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How to spot a gap in the market: The minds leading the non-alcoholic drink movement

Smarter Writer
Smarter Team

A team of business and technology journalists and editors who write to help Australia’s community of small and medium businesses access the technology and know-how that helps solve problems and create opportunities.

Smarter Writer
Smarter Team

A team of business and technology journalists and editors who write to help Australia’s community of small and medium businesses access the technology and know-how that helps solve problems and create opportunities.

Paying attention to evolving customer needs is essential for any small business. Australian drinking culture has been changing over time. The Australian Institute of Health and Welfare found that younger generations are drinking less – a trend that has been accelerated by COVID-19 isolation. We chatted to three small businesses who spotted the need for on-trend non-alcoholic drink options and in turn created new revenue and growth opportunities.

Heaps Normal co-founders Jordy Smith, Andy Miller, Ben Holdstock and Peter Brennan have a can of non-alcoholic beer in a pub.

Many small businesses operate in saturated markets, where competition is fierce and cutting through the noise is difficult. If you’re looking for real growth, it’s a good idea to keep your ear to the ground so you can figure out what’s coming next. Developing an entrepreneurial mindset can help you stay on top of customer trends and help you spot gaps in the market that could lead to a promising business opportunity.

Heaps Normal, Altina and Brunswick Aces are three businesses who took note of cultural change and launched successful new brands. They each share a vision: to help Australians reduce their alcohol consumption. Here, we discover how they decided to take the plunge, conducted market research and built a social media following.

Heaps Normal co-founders Jordy Smith, Peter Brennan, Andy Miller and Ben Holdstock have a can of non-alcoholic beer at the beach.
Heaps Normal co-founders Jordy Smith, Peter Brennan, Andy Miller and Ben Holdstock.

Heaps Normal – non-alcoholic beer

Founded in 2018 – and officially launched in July 2020 – Heaps Normal brew “beer without the hangover”. Co-founders Peter Brennan, Andy Miller, Ben Holdstock and Jordy Smith, created the brand for four very different and deeply personal reasons. But as Peter tells us over the phone, they all had one thing in common: they wanted to reframe their relationship with alcohol. After discovering the lack of great non-alcoholic beer options, they committed to developing a delicious alternative. It’s led to their two offerings: Quiet XPA and Another Lager.

At first the team brewed 50-litre test batches in Ben’s kitchen. With the help of Brick Lane, a contract brewer, they scaled into a commercial volume setup. Then the hard work began. “We started blind taste-testing it with a lot of chefs and sommeliers and restaurateurs and publicans,” Peter says. “They all loved it and said, ‘Ah, this is like a 4%, 5% beer.’ And we said, ‘No, it's non-alcoholic.’ Jaws hit the floor and we realised we were onto something.”

Peter tells us it wasn’t always smooth sailing: “We were laughed out of a lot of pubs in the early days.” But the feedback they were receiving, combined with experience of the growing “mindful drinking” trend spurred the team to follow their instincts. “We didn’t really go deep on research,” he says. “All of us had travelled a little bit before creating Heaps Normal. I'd recently been in Tokyo and the US and noticed some trends of younger people not drinking alcohol. So that was a bit of an eye opener. In my experience, things land in Australia a year so after they really take off everywhere else.”

When it comes to building their social media following, Heaps Normal take an organic approach. Peter explains that outside of using a tool called later.com to schedule their Instagram posts or putting a little bit of money behind a few campaigns, they don’t usually boost anything. He says their growth comes down to two things. “One, is the product itself. Benny’s a co-founder and the head of product and he’s an incredible brewer. He's made a product that tastes amazing and some people can't tell the difference,” Peter explains. “The other thing is the brand. We’ve never been preachy.”

"Our whole thing has always been, what's normal to you might not be normal to me and that's totally okay."

Peter Brennan, co-founder of Heaps Normal

As Heaps Normal approaches its two-year milestone, they’re stocked in approximately 4,000 venues around Australia and on shelves in New Zealand and Singapore, with plans to expand further afield this year. The team have also been named the ACT State Winner at the 2022 Telstra Best of Business Awards in both the Embracing Innovation and Outstanding Growth categories. As for Peter’s take on their success? “People are really resonating with what we’re doing. We’re just grateful that people are into it.”

He also approaches his competition with a similar attitude. “I think the stigma around non-alcoholic beer is definitely going away and I think that's down to a lot of different brands and businesses operating in this space,” Peter says. “For every competitor we have, there's another person that's aware of it and giving non-alcoholic beer and drinks a go. They’re realising it's not that bad waking up without a hangover.”

Altina co-founders Christina DeLay and Alan Tse cheers with a glass of their non-alcoholic wine.
Altina co-founders Christina DeLay and Alan Tse.

Altina – non-alcoholic wine

Altina is a collection of Australian made, botanical, non-alcoholic wines. Co-founders Christina DeLay and Alan Tse combine the latest in green chemistry with high-quality ingredients for a sugar-free, plant-based tipple. We caught up with Christina to learn about how they uncovered a gap in an emerging market.

How did you decide to take the plunge into producing non-alcoholic wine?

Alan and I started Altina in 2018 when we decided to change our relationship with alcohol but found very few alternatives. I embarked on a journey to use my Bachelor of Chemical Biotechnology and my PhD in Plant Biology to create the unique taste profile of Altina. Unlike other non-alcoholic wines that typically combine de-alcoholised wine and concentrated grape juice, we never add sugar to our formulations. Instead, we use natural ingredients and native Australian botanicals. My blending skills deliver a nuanced and layered drinking experience designed to build in complexity as you sip.

Did you conduct any market research before launching your product? If so, how? And what did you find?

When we started thinking about developing and launching a range of non-alcoholic drinks there were no reference points in the market. The best option at the time for an adult wanting to decrease their alcohol consumption was Lemon Lime and Bitters or a soda water with lime. There was nothing sophisticated and sugar-free. After experimenting with different flavours and new production techniques we set up a crowd-funding campaign to raise the funds to produce our first batch and create a community of people who were interested in the idea within our local area of Canberra. The production of the first batch proved successful. The taste profile was well received and interest in the brand quickly grew.

You have over 7,000 Instagram followers. What digital tools do you use to market your brand and boost your social media following?

We began by focussing on our community – we built our following organically in the early days by partnering with local businesses and events to help people discover us. We created a user-friendly website so we could start selling our products directly to our customers. Then, we started to build our social reach through social media advertising and investing in a range of digital marketing experiments. As our eCommerce offering has become more sophisticated, we’ve been able to offer our community innovative content and products – like our Zero Proof Festival in 2020 and a hybrid virtual/in-person series celebrating life with less alcohol. We also offer Australia’s first non-alcoholic subscription service.

Brunswick Aces co-founders Cameron Hunt, Stephen Lawrence and Diana Abelardo sitting at their bar.
Brunswick Aces co-founders Cameron Hunt, Stephen Lawrence and Diana Abelardo.

Brunswick Aces – non-alcoholic spirits and cocktail bar

Founded in 2017 by a group of like-minded neighbours, Brunswick Aces is Australia’s first non-alcoholic spirit brand, online store and cocktail bar. In an effort to find a drink they could share, the group used their collective skillset (including science and engineering) to develop three non-alcoholic sapiir blends and three alcoholic gin blends: Spades, Hearts and Diamonds. These “twin ranges” mean everyone can enjoy the same drinks with the same flavour profile and not feel left out. We chatted with brand director Stuart Henshall to find out what makes Brunswick Aces tick.

How did you decide to take the plunge into producing beverages and, later on, Australia’s first non-alcoholic cocktail bar?

Once we started sharing our creations with friends and family, and began receiving glowing responses and increasing demand, we knew we had something potentially great on our hands. Between 2017 and early 2020, we focused on growing our two non-alcoholic blends, Spades and Hearts, with premium venues and found strong market demand in the Middle East very early on. The Middle East remains one of our key markets to this day.

After the first year of the pandemic, data came out that signalled our relationship with alcohol was going one of two ways: greatly declining or worryingly increasing. We predicted that in a post-COVID-19 world a rebalance would happen – those who had increased their alcohol consumption would want to drink less and those who had reduced their alcohol intake would be looking for somewhere to socialise without the temptation. Opening the bar for us had always been a dream, but COVID-19 accelerated that for us. 

We were called mad for opening something as avant-garde as a non-alcoholic bar, particularly in the middle of a pandemic, but it has paid off in spades for us. 

Did you conduct any market research before launching your product? If so, how? And what did you find?

As our product was created from a personal need we didn't conduct any market research.  We create products based on our own preferences and they just so happen to appeal to a wider audience. 

"Since we began in 2017, the growth of the non-alcoholic industry has been incredible. We've gone from a couple of products to some of the best non-alcoholic drinks in the world coming out of Australia"

Stuart Henshall, brand director of Brunswick Aces

Opening Australia's first non-alcoholic bar has given us a great insight into what non-drinkers and moderators are looking for. We use this insight as we look at new brands to stock in the bar, bottle shop and online.

You have over 8,000 Instagram followers. What digital tools do you use to market your brand and boost your social media following?

As we're all about community, we have been focused on organic social growth and drawing people to us naturally over time. We've done very little paid digital advertising, with our success to date being a 95% PR led approach. Customer experience, our quality products and community focus has been our reason for success to date.

Heaps Normal, Altina and Brunswick Aces show the value of keeping an eye on customer trends. If you’re launching a startup or looking for new growth opportunities for your business, it’s worth following their lead. There are many ways you can conduct market research – from more complex qualitative and quantitative methods, through to cost-effective desktop research like reading the news, analysing Google Trends data, exploring social media or reading trend reports. Arming yourself with knowledge will put you in the best position to notice any gaps in the market and gain a competitive edge.

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