It’s “peak seltzer” because America’s infatuation with carbonated beverages may be waning.
Younger customers, particularly Gen Z, are rapidly eschewing carbonation in favor of still beverages including iced teas, canned lemonades, flavored waters, and non-carbonated energy drinks after years of explosive expansion fueled by sparkling waters, hard seltzers, and bottled fizzy cocktails.
Grocery aisles, liquor store shelves, and even the alcohol business itself are changing as a result of the spike in demand for fizz-free cocktails. Major manufacturers are struggling to keep up.
After almost ten years of being dominated by sparkling drinks, industry insiders claim that “seltzer fatigue” is beginning to set in.
According to Randy Burt, Americas director of consumer products at consulting firm AlixPartners, “more people want still drinks now than they did a few years ago,” he told CNBC.
“Both alcoholic and non-alcoholic beverages have seen a significant shift toward non-carbonated options.”
The trend is especially noticeable among Gen Z consumers, who prioritize wellness, hydration, and functional beverages over conventional sugary sodas or highly carbonated drinks and are consuming less alcohol overall.
Once thought to be unstoppable, hard seltzers are already beginning to slow down.
Younger consumers are increasingly choosing still drinks like flavored waters, iced teas, and non-carbonated energy drinks over carbonated ones (stock image).
Circana data shows that sales volume for ready-to-drink cocktails increased by more than 46 percent over the previous year, while sales volume for malt-based hard seltzers like White Claw decreased by 1.1 percent.
Brands that sell non-carbonated drinks, such as Surfside, BeatBox, and Sun Cruiser, have contributed significantly to this expansion.
Thanks to its vodka-based iced tea and lemonade cocktails, Surfside, which debuted in 2022, has grown to become one of America’s fastest-growing alcohol companies.
Because customers wanted something different, the company purposefully avoided carbonation, according to founder Clement Pappas. “Who carbonates iced tea?Pappas remarked. “The demand for non-carbonated options was enormously pent-up.”
Younger women seem to be particularly drawn to it, as many of them claim that carbonated beverages might make them bloated or uncomfortable.
“We’re seeing consumers jump quickly from one hot product to another,” said Circana executive Scott Scanlon, adding that Gen Z consumers are also far less devoted to beverage brands than older generations. “Now, non-carbonated drinks are experiencing that.”
After almost ten years of being dominated by sparkling drinks, industry analysts claim that “seltzer fatigue” is beginning to set in (stock image).
According to Circana data, sales volume for ready-to-drink cocktails increased by more than 46% over the previous year, while sales volume for malt-based hard seltzers like White Claw decreased by 1.1%.
The change is being accelerated by the larger health-conscious movement.
Many Gen Z consumers are adopting trends like “nonna maxxing,” a slower lifestyle centered on moderation, sleep, and wellness, and “zebra striping,” when drinkers alternate alcoholic and non-alcoholic beverages during social gatherings.
Younger Americans are increasingly selecting midday drinks, low-alcohol choices, or functional beverages that promise energy, hydration, or health advantages over late-night cocktails.
Brands that sell flavored waters, tea-based drinks, and non-carbonated energy drinks now have enormous prospects.
After learning that many younger consumers detested sparkling drinks completely, Celsius Holdings recently expanded its fizz-free energy range.
“A lot of consumers just don’t like drinking sparkling beverages,” stated Kyle Watson, chief brand officer at Celsius. The company’s peach mango green tea flavor is currently one of its best-selling products.
Hint Water, a flavored water company, is making significant bets on the anti-fizz trend.
Bubbly drinks are by no means going extinct, though. Hard seltzers still bring in billions of dollars annually, and brands like PepsiCo’s Poppi and sparkling energy drinks continue to do well.
Once thought to be uncommon in the beverage market, non-carbonated liquids supplied in aluminum cans have become more common thanks to canned water behemoth Liquid Death.
“We’re seeing the exact opposite of the sparkling-water boom now,” stated CEO Michael Pengue, adding that consumers are increasingly searching for drinks that feel lighter, smoother, and simpler to down rapidly.
Even the massive canned water company Liquid Death has contributed to the normalization of non-carbonated drinks sold in aluminum cans, which were formerly thought to be uncommon in the beverage market.
According to experts, the popularity of canned still beverages is also assisting companies in marketing their goods as fashionable and portable, appealing to customers who value the environment and favor cans over plastic bottles.
Bubbly drinks are by no means going extinct, though.
Hard seltzers still command billions of dollars in sales each year, and brands like PepsiCo’s Poppi and sparkling energy drinks continue to do well.
However, beverage executives are beginning to think that smoother, fizz-free substitutes may be the next big thing.
The future of alcohol use may appear much less promising to younger Americans.
