Arizona producers dive into low and no-alcohol trend with new drinks

In spite of a perpetual newscycle that might call for a stiff drink, Americans are consuming less alcohol than ever. 

An August 2025 Gallup Poll showed that 54% of Americans claim to consume alcohol, a 90-year record low for the poll, driven by concerns that even a moderate amount of consumption is a net-negative for one’s health. 

As one might expect, sales of alcoholic beverages are down, with industry publication The Spirits Business tracking a 2.2% decrease in U.S. booze sales in 2025. 

Beer remains the dominant beverage for those who choose to imbibe. But there is a rapidly growing segment of the market that is notching record numbers and challenging the status quo for alcohol consumption.

That niche is the NoLo market of nonalcoholic and low-ABV beverages, which, according to NIQ, surged to nearly $1 billion in total sales in the U.S. in 2025. 

Researchers surveyed this growing market and found that 92% of NoLo sales were purchased by people who still drink “regular” alcoholic drinks, insinuating that while folks still want to drink, they want to do so in a healthier way. 

Sensing this shift in drinking preferences, three local tastemakers are meeting the demand with new low- and no-ABV options to help maintain a modicum of healthy living while still giving us something to look forward to when happy hour rolls around.

Adam O’Connor – Smidge Beverage Co.

Adam O’Connor founded Smidge Beverage Co., producing lightly boozy vodka sodas that are 2.5% ABV, have 50 calories and one gram of sugar. They are also free of gluten and artificial flavors.

“With Smidge, it’s all about keeping things at a good level, so fitting one in between your IPAs or cocktails helps you not to overdo it,” the Arizonan says. 

O’Connor’s journey to the low-ABV niche started in 2023. He was working in alcohol distribution when he read an industry article that alluded to the rapidly expanding market for nonalcoholic beverages. 

O’Connor mulled over these findings and compared them with observations in the industry about Gen-Z’s drinking habits. Specifically, how they were drinking less, and more intentionally, than any previous generation. The gears began turning. 

“They are drinking less and also trading between products, and the occasion really matters to them. So I started thinking about the concept of an ultra-low cocktail,” O’Connor says. 

After some research, O’Connor started developing an idea to claim a share of this untapped, or in this case, uncracked, market. 

“The whole game of beverage is marketing. Anyone can make a great-tasting beverage today with the insane food science that we have. It’s all about brand and marketing, but I wanted it to be fun, get the point across, to get to the heart of its identity. It’s 2.5 percent, about half your typical White Claw or beer, and only 50 calories,” O’Connor says.

“My mom wound up coming up with the name. It’s got just a smidge of vodka, so why don’t you call it that? We all looked at each other, it was genius! It’s funny, memorable and playful. Do you want a drink tonight? Just a smidge. Then it dovetailed: put a smidge in your fridge, and on and on,” O’Connor recalls.  

With the concept in place, O’Connor began dialing in his recipe. He looked for a flavorhouse where he could develop a light, effervescent cocktail that replicated a vodka soda with a twist of citrus. Because of its spirituous nature and Arizona’s liquor laws requiring vodka-based beverages to be produced at a distilled spirits plant, the beverages are currently produced in Oceanside, California. 

“I tried really hard to produce it here, because Arizona is my home, I’m a fifth-generation Arizonan, but no one would do it for me. The quotes I was getting were going to eat my entire profit, and since we eventually want to expand into other states, we just had to work with what we have. Beer would have been much easier,” O’Connor jokes. 

To make matters more complex, Arizona tax law is based on content rather than proof and, as such, requires spirit-based drinks to pay the same liquor luxury tax as full bottles of vodka, resulting in a higher price point for beverages like Smidge. But O’Connor believes it’s worth the trouble and the cost. 

“This shit is hard. Building a brand is tough, and the route to market is challenging. But the only two markets that are growing right now in beverages are spirit-based, ready-made cocktails and lower or non-alchohol, and we are hitting the sweet spot with both,” O’Connor says. 

While production and pricing might be challenging, thankfully, distribution concerns have become easier. Recently, Smidge signed with Hensley for distribution in Arizona, which means you can find all three flavors, Blackberry Cucumber, Pineapple Papaya, and Orange Blossom Strawberry, in all AJs and Bashas, plus some Total Wines.

This spring, the top-selling Blackberry Cucumber lands in all Safeways and Albertsons, totaling all 140 stores. O’Connor is also currently working on an eight-pack variety case for these locations, which would include adding a new flavor to the stable. 

Another part of O’Connor’s business is his commitment to giving back to his community. As a survivor of childhood leukemia who was treated at Phoenix Children’s, O’Connor wanted to do something to give back to an organization that saved his life, and the lives of countless others. 2.5% of Smidge’s profits are dedicated to pediatric research.

“I wanted to do something to keep it tied locally, and also give back to something that is important to me and so many others,” O’Connor says. 

“At the end of the day, Smidge is about building better habits while building community,” O’Connor reflects.

It might be a small thing, but like his beverage, a little bit can be more than enough. 

Dustin Johnson – Rhinestone Extra Light

For Arizonan Dustin Johnson, the foray into nonalcoholic beverages was less about preaching a sober lifestyle and more about finding some balance without losing his edge. 

When he created Rhinestone Extra Light, an NA brew that is only five calories, zero carbs and gluten-free, he aimed to give his rowdy friends an alternative beverage that wouldn’t lose any flavor or, in his words, “swagger.” 

“I am one of the more unlikely NA founders. I am not sober, but I am 44, and hangovers start to hurt a little more at my age. I started mixing in some non-alc beers every now and again, but couldn’t find anything that felt quite right, and most were pretty heavy – 90 calories, 13 grams of carbs, that sort of thing,” Johnson recalls.

To satisfy an urge for a light, alcohol-free alternative between cocktails, Johnson started researching and reaching out to industry people. With a background in the cannabis industry, he soon realized there could be an opening in the market for something for people who weren’t necessarily ready to get sober, but also not wanting to get hammered on the weekend. 

“It seemed like most NA beers were preaching sobriety and wellness, and I wanted to make something you could have a couple of, that was really designed for the tequila-drinking, beer-crushing, weed-smoking rowdy folks that still want to get after it, but might also have small kids that don’t respect a weekend hangover,” Johnson says. 

Johnson’s concept of “rowdy moderation” is delivered in four flavors. The original is their version of a light beer, and there are three citrus options: Mexican lime, desert grapefruit and blood orange. 

Johnson’s family are proud Arizona thoroughbred ranchers, and the Rhinestone branding weaves Western nostalgia and old-school, beer-cracking swagger with bucking broncos and mustachioed skeleton cowboys. Occasionally, you can find Johnson and his team handing out ice-cold cans at local events from a converted vintage Rambler, where he is quick to solicit feedback from the crowd. 

“We were at the Dreamy Draw Festival in Scottsdale, and I was standing about twenty feet back from the Rambler, and just listened to see what people were saying, because from that distance, as people are walking away, they are usually pretty honest when you are eavesdropping,” Johnson admits. “The overwhelming majority of people were like, ‘These are actually really good! They are so light and easy to drink!’ which is really the ultimate compliment.”

According to Johnson, Rhinestone went through more than 2,500 sample cans during their two-day stint at the music festival.

With a new distribution deal recently signed with Hensley, Johnson is setting his sights on becoming the most popular local NA beer in the state. Rhinestone is available at all Sprouts stores in Arizona, select Total Wines and King’s Beer and Wine, along with roughly 40 bars throughout the city. In addition, Johnson has reached out to his cannabis contacts to form an alliance with Soul Flower Dispensaries. 

“That’s such a cool partnership. We had some connectivity from my previous work, and we thought there was a good opportunity for crossover. Most people who are smoking weed or eating gummies aren’t drinking a lot, but they might want something in their hand in a social setting. So they put us in all nine retail locations for January, and in the first five days, we had sold about 25% of their initial purchase. It was crazy!” Johnson explains. 

For Johnson, moving from the cannabis industry to the world of NA beer has been liberating. 

“Coming from that realm, with all the restrictions, to this one, which, without the alcohol and calories, but all the punch and ritual of a 5 o’clock beer, it’s been amazing,” Johnson says. “At the end of the day, we’re just here in between the Old Fashioned or the joint, not judging, just here to help you maintain.”

Adam Zloto – Chestnut Sports Club: Light Citrus Lager

“We call it the playable beer,” says Chestnut Sports Club founder and Phoenix native Adam Zloto. His Light Citrus Lager comes in at 3.7% ABV, has 90 calories and five grams of carbs. 

“You can have it in your hand all day, and it’s about as guilt-free as a normal beer can be without giving up any flavor, and the lower ABV really hits the sweet spot for people who want to have a couple but still be in control.”

Brewed locally in Tempe at Zonafide Beverages, the umbrella company of the recent Huss and Phoenix Beer Co. merger, the brew delivers a full-bodied sipping experience without the funky finish of some light beers. 

Zloto developed the concept when he found himself in a classic beer-lover’s dilemma: choosing to enjoy a beer (or several) with friends or to engage in recreational activities. He found that sipping a heavy IPA on the pickleball court could lead to more drinks than dinks, but light beers lacked flavor and often felt like an afterthought for most breweries. 

He scoured the market to no avail, trying many different beers and becoming, as he put it, “obsessed with finding a thing that just didn’t exist.” 

Ultimately, Zloto set out to create his own beer that he could enjoy while keeping up his active lifestyle. 

As it turns out, a low-calorie, low-ABV, full-flavor beer was a novel idea. After some product development in Petaluma, California (home of Lagunitas and HenHouse breweries), Zloto moved his concept back to his home state. The name, however, is a nod to the decade he spent in the Bay Area. 

“I was living in a studio on Chestnut in San Francisco, and I was recovering from ACL surgery, so I was jokingly calling my place the Chestnut Sports Club. Flash forward years later, and it turns out it’s the perfect brand concept,” Zloto says. “I didn’t want a ‘Beer Co.’ but rather a lifestyle sort of angle, and the name gives us that creative runway, while making an iconic brand.”

Chestnut Sports Club’s recognizable forest-green cans hearken back to the ‘80s country club, and would be right at home as a full-page ad in an old Sports Illustrated. It’s a cheeky callback that’s still modern and fun.

The conversation-starting cans can be found in all Sprouts locations, along with select Total Wines and AJs, as well as independent shops like Monsoon Market, which was one of the first shops in the city to partner with Chestnut Sports Club. 

According to Zloto, the low-ABV beer is also a hit at spots like Gracie’s Tax Bar, Club Contact and Joy Lush Club. A tap program is starting at Tia Carmen at the JW Marriott Phoenix Desert Ridge Resort and expanding throughout the city this year. 

While Zloto’s goal is to make his can a fixture for those who want to keep the game and party going throughout the day, he is currently enjoying the moment. 

“At the end of the day, it’s about balance,” he says. “It’s light, but still tastes like beer. It’s got alcohol, but at a lower amount. It’s just a good pace-setter.”