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Gen Z isn’t big into drinking alcohol and this has an impact on live music

File photo. Arenas depend on alcohol sales at games and concerts. As Alan Cross explains, Millennial and Gen Z consumers are buying less booze and this has implications for live music. AP Photo/Julio Cortez

So much of the live music industry depends on alcohol. Revenue from bar sales, concessions, and sponsorships pays for so many of the costs associated with live gigs and touring that it’s tough to imagine the industry without it.

Older demographics (read: Boomers and Gen X) are the best. They grew up buying beer at concerts and later embraced, wine, coolers, and cocktails. They drink so much at shows that arenas, stadiums, and amphitheatres eventually installed cupholders at every seat — not, contrary to common belief, as a place to put down your one drink but as a place to store the second one you bought while you quaff your first.

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Some artists attract bigger drinkers than others. Parrotheads — Jimmy Buffet’s acolytes — drink so much at shows that Buffet can command a performance fee of 105 per cent of ticket sales, the extra five per cent being his cut of his fans’ drinking habits.

Beer and booze companies often sponsor tours and festivals (see Jägermeister among many others), hoping to reach large numbers of drinkers. Meanwhile naming rights — think Toronto’s Budweiser Stage — inject much-needed operating capital into a venue.

For small- and medium-sized venues, bar and concession sales are often the only things that will make a gig profitable for them. Artists will often get door revenues (or at least the lion’s share) while all the venue’s revenue comes from the alcohol they sell to the punters.

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Bottom line? Alcohol, in all its forms, fuels much of the live music industry. That makes sense because, for decades, music and booze have gone together like vodka and Clamato. But what if that symbiosis were to break down?

Two new surveys out of the U.S. (one survey from the University of Michigan and another survey from Berenberg Research) suggest that young people — let’s call them younger Millennials and Gen Z — don’t drink as much alcohol as previous generations — up to 20 per cent less, in fact. The number who don’t drink at all might be as high as 28 per cent.

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When it comes to those who do imbibe, beer is taking the biggest hit. Millennials started it. Remember the “I don’t like beer” commercials promoting spirits? And now Gen Z seems to be accelerating that trend, moving more toward other alcoholic beverages like vodka and gin.

Canadians have been bailing on beer, too. In 2008, the average Canadian beer drinker consumed 89.1 litres per year. That was down to 67.1 litres in 2021, driven lower by the pandemic as bars, clubs, and restaurants remained closed or operating on reduced hours. That was up to 71.2 litres in 2022, boosted by a surge in the popularity of craft beer, but on the whole, breweries — especially the macro-companies like AB InBev and Molson Coors — are still very concerned. Higher taxes on Canadian beer are also a problem. (Newfoundland: You’re exempt from this discussion because you’re drinking more — way more — beer than before.)

Drinking less is certainly good from a health point of view. But why is this happening now?

The high cost of concert tickets and the rising price of drinks are the most obvious. The younger demos are also more conscious of things like mental health. But the rise of cannabis edibles is also a factor. Chomp down a couple of THC gummies an hour before the gig and by the time the band comes on, you’re in that altered state where music sounds awesome. That’s also certainly cheaper than buying multiple beers at the club.

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Another issue is that beer advertising has been traditionally aimed at white men. Breweries now realize that they need to attract women and minorities — two groups that have increased their alcohol consumption — and may not be entirely sure how to pivot.

This is creating a revenue issue across the live music industry. Selling alcohol has always been a reliable and important revenue stream for venues. Ask any club that hosted raves where most of the crowd was on MDMA and only wanted water. Some hip-hop venues will tell you that the crowd doesn’t consume as much alcohol as rock or country fans. For some shows, it’s like a throwback to the days of all-ages shows where no one drank.

And it’s not just the younger demos. Some trends point out that post-pandemic, older attendees aren’t throwing them back as much as they used to.

If bar and concession sales continue to drop, venues will find the current inflation-induced cash crunch getting worse. Sponsorship money may go elsewhere. Artists will be pressured to give up a bigger cut of ticket sales meaning that they’ll make less per gig. The ripple effects threaten to be massive and long-lasting. The revenue remaining after cigarette advertising was banned is now facing an uncertain future.

This declining revenue just adds to the worries of venue operators who are already facing rent increases, higher labour costs, rising energy bills, and more. The money has to come from somewhere. If not beer, where?

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Alan Cross is a broadcaster with Q107 and 102.1 the Edge and a commentator for Global News.

Subscribe to Alan’s Ongoing History of New Music Podcast now on Apple Podcast or Google Play

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