Opinion / Why mocktails often cost more than cocktails – and why millennials and Gen Z don’t mind paying more for drinks without booze

This story is part of STYLE's Inside Luxury column

Why do non-alcoholic “spirits” cost so much, sometimes even more than their alcoholic counterparts?

I travel quite a bit in my job consulting CEOs of luxury and lifestyle brands, at least in the pre-Covid-19 days. My typical schedule would shuttle me continuously back and forth between cities like Los Angeles, New York, Paris, Dubai, Moscow, London, Shanghai, Hong Kong, Seoul and Tokyo; 20 to 30 overseas trips per year were the norm when there was no lockdown.

One thing I started to notice all around the globe has been the emergence of non-alcoholic drinks. Whether you are in a glitzy bar in Shanghai or a restaurant in Paris, mocktails seem to be more commonplace.

Even on aeroplanes, the drinks menu started to change. In January 2019, Virgin Atlantic launched the first no and low alcohol cocktail menu on board of a commercial plane service and their non-alcoholic Red Sky at Night became a traveller’s favourite.

In August 2019, Seedlip, the self-proclaimed world’s first non-alcoholic spirit, was acquired by Diageo, a company that has been historically focused on alcohol. Seedlip’s non-alcoholic beverages are priced around US$30, on par or even more expensive than some of the alcoholic spirits they aim to replace. The acquisition is a sign that times are changing.

And this is what many people wonder: when you order a non-alcoholic spirit in a restaurant, why are they sometimes more expensive than their alcoholic counterparts? Why would a mocktail cost more than a cocktail? Wouldn’t logic suggest the opposite? Most countries have steep alcohol taxes, which should make the booze-free versions significantly cheaper. So why the prices?