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Business trends

Japan taps the $3bn potential of 'sobernomics'

Nondrinkers fuel demand for alcohol-free wines and spirits

 A limited-edition tea sold by Royal Blue Tea Japan that is priced at 300,000 yen a bottle sold out in three days. (Photo by Jun Takai)

TOKYO -- A new cultural and economic trend called "gekonomics" is spreading in Japan thanks to teetotalers. The term is a play on the word geko, which means someone who does not drink.

More restaurants and bars are serving courses with matching wines and cocktails that are basically alcohol-free. The beverages, which are aimed at the adult palate, are available in department stores. One estimate puts the economic impact of the trend at 300 billion yen ($2.77 billion). That is something everyone in the business can raise a glass to, whatever they are drinking.

"Everyone, nondrinkers night has begun!"

"Cheers!"

At Nami to Kaze, a Japanese restaurant in Kamakura, southwest of Tokyo, men and women in their 30s, 40s and 50s made small talk and sipped nonalcoholic concoctions from Champagne flutes, enjoying a prix fixe meal and paired drinks priced at 18,000 yen per person. The drinks are all alcohol-free.

For the toast, guests had a nonalcoholic version of a Leonardo, a cocktail made with Champagne and strawberries. The sparkling wine base is made in the normal way, with the alcohol later removed. "It's good because it's not too sweet," said one guest. The others also looked satisfied.

"You don't get drunk because it's alcohol-free, so you can really enjoy the flavor of the food until the very end," said another.

The organizer of this "nondrinking drinking party" was 53-year-old Hideto Fujino, president of Rheos Capital Works in Tokyo. In his previous life, he worked at an overseas financial institution. But the constant wining and dining that was part of the job took a toll on his health. Fujino decided to quit drinking, something that changed his life.

From that point on, Fujino would order nonalcoholic beverages at group dinners, but he felt like a child when the drinks arrived and his was the only glass with a straw. "Drinking culture is a culture for tough guys," Fujino said. "When I wasn't able to drink I started to appreciate the feelings of nondrinkers."

Since last summer he has been reaching out to other teetotalers on social media, and he started the nondrinkers night parties. The gatherings are sporadic and usually cost about 20,000 yen. Fujino understands the difficulties nondrinkers face, such as finding restaurants that serve good nonalcoholic drinks. The parties always fill up quickly.

Hideto Fujino, third from right, president of Rheos Capital Works, organizes dinners for teetotalers who want to enjoy food without alcohol.

As the number of people who chose not to imbibe grows, the question is how big the market may become. "The potential economic impact of gekonomics is more than 300 billion yen," said Fujino.

According to estimates from Suntory Holdings, 22.65 million cases of nonalcoholic drinks were sold in Japan last year (including nonalcoholic beers and chuhai cocktails, but excluding soft drinks), four times more than in 2009. More and more they are seen as a product to be enjoyed for their own sake, rather than as a substitute for alcohol.

With the Tokyo Olympics coming up this summer, a large number of nondrinkers from overseas will gather in the capital. This year may be a game-changer for gekonomics.

On the first floor of the Parco department store in Tokyo's trendy Shibuya district is Bar Straw, which specializes in nonalcoholic drinks. It opens at 6 p.m., only on Mondays and Tuesdays. It serves original cocktails made with nonalcoholic gin, juice, herbs, spices. The orange coffee tonic and nonalcoholic matcha beer are two popular menu items. Laughter rings out from the bar during evening hours. Among the customers are high school girls in their school uniforms.

One regular customer, a man in his 20s, said that he was able to drink during his university days if he really pushed himself. But after he started working, "I tried good nonalcoholic drinks and became a true nondrinker," he said.

There are also people who make elaborate nonalcoholic beverages to drink at home. Ryo Taniguchi, 27, and his friends from his university days bring ingredients like plum syrup and ginger syrup and hold "drinking parties." Using juices and spices, they create their own original drinks and rate them. "It's also good for your health," he said. He plans to start a nonalcoholic beverages shop at a flea market.

"Elective nondrinkers," that is, people who can drink but choose not to, are also on the rise. "I think older people may want to forget things using alcohol, but our generation wants to share a lot of unforgettable experiences with our friends," said 27-year-old Tomoka Furutani, who is self-employed in Tokyo. Now there are many things other than alcohol -- like music -- to get into.

"I'm useless until the next day if I drink," said a Tokyo woman in her 50s who decided to stop drinking. Not only does she avoid alcohol at drinking parties, afterward she goes to the gym or does some work.

High quality nonalcoholic drinks are coming into their own, fueling the market's growth. France's 1688 Grand Rose costs 4,212 yen for a 750 milliliter bottle. It looks like a high-class sparkling wine.

"It's a necessary item for things like celebrating births," said a woman in her 30s in Tokyo. She used to like drinking, but she stopped when she gave birth and was breastfeeding. She didn't like making toasts with juice, so she started using Champagne glasses. "This [nonalcoholic] drink is served at high-class hotels, and in first class on a JAL [Japan Airlines] flights. I find that really cool," she said. According to Tokyo-based Yell, an importer, sales have increased by 25 times since it started selling the beverage 12 years ago.

There is also high-quality tea that comes in a wine bottle, rather than a plastic bottle or a can. On a weekday afternoon at Royal Blue Tea Roppongi Boutique The T Bar, the store is filled with people looking for presents. Prices for a 750 ml bottles start at 5,000 yen. Many companies buy the tea to give as gifts, but "the number of individuals buying it is growing," said Keiko Yoshimoto, president of Royal Blue Tea Japan, which runs the store in Roppongi. Limited-edition bottles costing 300,000 yen nearly sold out three days after they went on sale. The company's tea sales are up about 20% from the previous year.

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