How do cannabis beverages compete with adult soft drinks?

Core Investigation

As traditional beverage conglomerates like asahi-group-holdings pivot toward a multi-beverage-strategy, they are heavily investing in functional adult-soft-drinks (e.g., 0.0% beers, botanical mocktails). This query investigates the competitive dynamics between these traditional NOLO (No-and-Low Alcohol) products and emerging cannabis-beverages (THC/CBD infused). Both categories target sober-curious Gen Z and Millennials seeking effervescent-escapism, relaxation, and stress relief without the caloric intake or hangovers associated with ethanol, as they vie for the adult share-of-occasion left vacant by declining traditional alcohol consumption.

Current Findings

The Substitution Effect

Cannabis is proving to be a highly effective direct substitute for alcohol. In the U.S., daily marijuana users (17.7 million) have surpassed daily alcohol users (14.7 million). Over half of marijuana consumers report drinking less or no alcohol after using cannabis, driven by a desire for relaxation without ethanol’s negative side effects.

Occasion Segmentation and Co-Consumption

While they share a demographic, the two categories naturally segment by daypart (see daypart-customization):

• Daytime: Adaptogenic adult soft drinks and CBD beverages dominate daytime use, focusing on anxiety reduction and mental clarity without inducing a “high.”
• Evening: THC beverages dominate evening social occasions, acting as a direct psychoactive replacement for traditional alcohol.

Despite this segmentation, survey data indicates that consumers often engage in “stacking” (an evolution of zebra-striping)—consuming both adaptogen formats and THC formats during the same occasion to curate their mood, rather than exclusively choosing one over the other.

Behavioral Intent vs. Format Accessibility

True free-market competition is difficult to measure due to regulatory skew. The battle between these categories is currently defined by the behavioral-intent-vs-format-accessibility framework:

• Cannabis wins on behavioral intent: It provides the psychoactive relaxation consumers are looking for, leading to aggressive substitution rates (often halving alcohol intake). However, THC beverages are heavily restricted by geographic and dispensary-specific laws.
• Adult Soft Drinks win on format accessibility: Regulated under FDA dietary guidelines, 0.0% beers and mocktails enjoy higher household penetration and sales growth (e.g., NA beer up 22% in 2024) simply because they are globally legal and easily integrated into mainstream retail and on-premise channels.

Premiumization, Unit Economics, and Product Convergence

Both categories face consumer resistance to high prices, raising questions about their comparative unit economics. Currently, 52% of consumers reject the premium price tags of non-alcoholic traditional drinks.

To compete with the inherent psychoactive value of cannabis, adult soft drink brands are leaning into functional-premiumization, adding adaptogens and nootropics to justify costs, as 40% of consumers are willing to pay more for functional benefits. Furthermore, to avoid direct cannibalization, brands are creating hybrid formulations that blend cannabinoids with adaptogens. These “super-functional” beverages collectively target traditional alcohol’s market share rather than competing strictly with one another.

Open Questions & Next Steps

• Direct Occasion Competition & Cannibalization: Are functional mocktails and cannabis beverages stealing market share from each other, or purely from traditional alcohol? Does a dollar spent on an adaptogen mocktail represent a net-new dollar to the beverage category, or is it directly stolen from a CBD/THC beverage purchase? Hard basket-level data is needed to confirm volumetric cannibalization.
• Fully Legal Market Baselines: How do the unit economics and premiumization of cannabis beverages compare to traditional NOLO products in fully legal markets? We need to source retail data specifically from markets like Canada or California to observe how Asahi’s NA portfolio performs when THC beverages have total retail parity and accessibility.
• Conglomerate Response: How will traditional beverage conglomerates respond to “super-functional” hybrids that offer mood-altering effects beyond just 0.0% ABV?