When it comes to beer, more legal-age Gen Z drinkers choosing American light lagers

How does one predict how an entire generation will make choices, including which beer to drink? A safe bet is to look at the preceding generation and take the opposite route.

It’s a construct that appears to be playing out with Gen Z, according to a new MillerCoors analysis of Nielsen and Ipsos data.

Baby boomers famously created the light beer segment. Gen Xers, who started off as light beer loyalists, got the itch for the robust flavors of craft beer and craft cocktails, sparking a revolution.

Then came the health-conscious millennials, who grew into legal drinking age amid a sea of craft beer but started chasing lower-calorie drinks filled with novel flavors, kicking off the hard seltzer craze.

Now we’re starting to get our first peek into the habits and preferences of legal-age Gen Z drinkers. And data show one possibly surprising finding: They’re passing up imports and craft beer and flocking instead toward American light lagers, which despite years of declining sales remain the bread and butter of the beer industry.

Here's a look at three early insights on the generation now entering legal drinking age.

They drink less alcohol overall

Gen Z consumers go out to bars and restaurants less than older generations. Some 82% of them say they’d rather stay in with friends than go out on the town, according to Kantar data. And when they do go to social engagements, they’re having fewer drinks both for health and peer perception reasons. Four in five Gen Zers say that proactively managing their health is important and they’ll buy products to support that.

While, like other generations, the vast majority of Gen Z drinkers perceive alcohol as a way to de-stress, they practice moderation, with just 15% of them considered heavy drinkers. That compares with about 40% of millennials.

As such, they value product attributes such as zero sugar, low carbs, natural ingredients and sessionability.

That’s a big reason brewers big and small are rushing into more low- and nonalcohol beverages. Molson Coors, for instance, just inked a deal to take a significant minority stake in L.A. Libations, a nonalcohol beverage developer and incubator. That deal reflects the company’s broader ambitions to expand its portfolio beyond beer.

They spend more on spirits

When shopping for alcohol off-premise, Gen Z spends the most of their alcohol money on spirits, the first of any generation to do so, per data form Nielsen and Scarborough. Gen Z spends 45% of their alcohol dollars on spirits, 31% on beer and 24% on wine. That compares with millennials, who spend 29% of their dollars on spirits, 41% on beer and 29% on wine.

This is a major concern among brewers, underscored by the stat that some 40% of the beer industry’s volume losses are occurring among drinkers aged 21 to 24, per previous MillerCoors research.

They love American light lagers

Perhaps the biggest shift between millennials and Gen Z is taking place between American light lagers and craft and imports.

Gen Z consumers offer a huge opportunity for American light lagers, which tick many of the boxes younger legal-age drinkers are seeking to support a more healthy lifestyle. They’re typically lower in carbs and calories than beers in other segments like craft, and they’re more sessionable and affordable to drinkers in this age group.

This younger generation spends far less on craft beer, instead using their beer money to buy other segments, including flavored malt beverages such as hard seltzers. But it’s American light lagers like Coors Light, Miller Lite, Michelob Ultra and Bud Light that they’re flocking to in the highest numbers. They spend more money and repeat their purchases more often when buying American light lagers compared with millennials, according to Nielsen Homescan data.

In the off-premise channel, which includes liquor stores, grocers and convenience stores, Gen Z consumers spend 27% of their beer dollars on American light lagers, compared with just 17% among millennials. They’re also spending just 21% on craft, while millennials are spending 33%, per Nielsen.

Light lagers are the No. 1 segment among Gen Z, which also appears to be shoving imports aside, at least as compared to their older counterparts, according data ending in September from Ipsos, a market research firm that captured roughly a third of its data from the on-premise channel.

This trend, in particular, injects a new shot of optimism in a segment in need of one.