Shifting American Alcohol Consumption Reshapes Booze Strategy

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(Bloomberg) — Americans are clearly drinking less these days, with alcohol consumption thwarted by a health-obsessed generation, weight-loss drugs and the growing popularity of cannabis. Or so the narrative goes.

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Alcohol volume was down 2% in the world’s major alcohol markets last year, though a much steeper drop of 5% was recorded in the US, according to data from the global alcohol analytics provider IWSR. Volumes may drop as much as 4% this year, BNP Paribas analyst Kevin Grundy calculated. 

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Some industry experts are pushing back against the narrative that the numbers suggest a permanent decline in consumption.

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The impact of GLP-1s, cannabis and health concerns is “overstated,” Barclays analyst Laurence Whyatt said in an interview. Instead, “economic difficulties” are to blame. 

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Weight-loss drugs lead to lower consumption among users, “but it’s not the thing that is driving” the downturn, said Chris Goodchild, Boston Consulting Group’s global beverage analyst. The GLP-1 hit on overall alcohol demand is less than 3%, BCG data shows.

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The wellness trend could also just be an excuse. “You don’t want to admit to your friends, nor to yourself, that you can’t afford a drink, so it’s much more comfortable to say, you know what, I’m trying to be a little bit healthier,” Marten Lodewijks, president of the IWSR, said in interview.

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American consumers are “famous” for giving up on health fads pretty fast and “are going to tire” of the side effects of GLP-1s, Lawson Whiting, chief executive officer at Jack Daniel’s owner Brown-Forman Corp., said at a conference.

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Whiting’s faith that the craze will fizzle may be wishful thinking for a company in trouble. The question, BNP’s Grundy said in an interview, is how many quarters it takes before a company acknowledges that shifts in consumption patterns are entrenched and need to be addressed. Grundy is on the skeptical side of the debate, arguing that consumers are increasingly turned off by the health risks.

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Green Shoots

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Still, recent trends are encouraging. So far this year, participation rates are up for most age groups and volumes have stabilized, Goodchild said. “If you see that trend continue, you could start to see an inflection point in 2027.”

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US consumption is likely to stay negative for the next four or five years before it starts to rebound, said IWSR’s Lodewijks. 

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Gen Z wallets will be crucial to the recovery, with the participation rate among younger people steadily climbing, Lodewijks added. An IWSR survey found that the share of Gen Zers who had recently consumed alcohol rose to seven in 10 in 2025, up from less than half in 2023.

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What will change is how younger generations consume.