X3M Ideas, easily Nigeria’s fastest-growing marketing communications agency, through its research arm, X3M Intelligence, recently released a report on the Nigerian beer industry. I have not seen the report, but media reports on the document present grim pictures of the market and create a downward-pointing chart for an industry many believed harbours great opportunities for investors.
If we take the report of Punch newspaper’s headline, hook, line and sinker, the effort to cultivate the future of the market among young people is failing. “Younger consumers shift toward wine, study reveals,” the headline screamed.
The first paragraph of the relatively long story says, “A new cultural intelligence study has indicated a gradual shift in alcohol preferences among younger Nigerian consumers, with wine emerging as an increasingly popular choice within a demographic long associated with louder, experience-driven drinking culture.”
BRANDCOM, in its own report, preferred to present it like a question. “Why Are Gen Zs Not Drinking? X3M Intelligence says that may be the wrong question to ask.” That was how the headline captured it. The opening paragraph read, “The prevailing assumption that Nigeria’s Generation Z is turning away from alcohol has become one of the most discussed themes in contemporary consumer marketing. Across global reports and industry commentary, younger consumers are frequently portrayed as sober-minded, health-conscious and increasingly detached from traditional drinking culture.”
The two news media channels under review have their point of convergence. While Brandcom took the longer route to conclude, Punch took the shorter cut. BRANDCOM says that while there is indeed a decline in the alcohol consumption habits of Gen Zs, the study, however, shows that “alcohol remains culturally relevant, socially symbolic and strategically important. Gen Z is still drinking, only more selectively, more occasionally and more intentionally than previous generations.”
But both were in agreement that Nigerian young people are drinking a lot less beer than wine and other alcoholic beverages.
One doesn’t look far to justify this. Data from company reports said that in 2025, brewers in Nigeria sold some 19.1 million hectolitres of beer. That number represented a 2.6 million hectolitres drop from the sales in 2024, which stood at 17.7 million hectolitres.
Nigeria is a big beer-drinking nation. Beer comes in when we celebrate as well as when we grieve. As individuals, once business is good, men hit the bars; when it goes bad, we also congregate at the bars to share our collective grief. Beers are useful during marriages. They are also what we cannot do without during funerals. It is no wonder the country ranks as the 18th beer-drinking country in the world and the second in Africa.
Other statistics say Nigeria has an annual beer consumption of approximately two million tonnes. However, demand for beer has been gradually shrinking. Though an average yearly consumption of two million tonnes sounds impressive, this average represents a significant drop in volume from the 2010s, when it was hovering around 2.5 million tonnes. In 2022, beer consumption in Nigeria was at a low of 1.8 million tonnes and was projected to be even lower in 2024. Demand appears to be shifting to the spirits market as consumer preference for spirits has improved.
Despite losing some of its market share to Spirits, beer is still the dominant alcohol type in Nigeria. A survey of 1229 alcohol consumers across six states (Lagos, Abuja, Rivers, Anambra, and Kaduna) in the first quarter of 2024 found 76 percent of alcohol consumers were drinking more beer in a week relative to other alcoholic beverage types, signalling its dominance in the Nigerian market.
What this immediately says is that analysing the industry from nominal profits might be misleading. The industry is selling far fewer bottles than the financial numbers suggest. The inflation and foreign exchange debacle Nigeria found itself in occasioned situations in which money represented far-depreciating values by the passing of the day. The average cost of a bottle of beer today is a lot higher than it was a year or two ago.
What this means is that the celebrations around the return to profitability after years of haemorrhaging losses might not mean that business has been great; it means that the forex blood drainer has eased. But beers are selling a lot less than in previous years.
Afrinvest West Africa, which had earlier made a growth projection of 39.2 percent, was forced to recant. This report, which was made known in a sector update titled “Brewing Back to Profitability”, released in May 2025, attributed the revenue performance to inflation-led price increases across product lines and an increase in consumer purchasing power following the national minimum wage hike by 133.5 percent to N70,000 in the third quarter of 2024.
Additionally, festive spending during “Detty December” events, especially in Lagos, injected an estimated N111.5 billion into the entertainment and tourism sectors, further boosting beer sales.
Afrinvest, however, noted that the road to recovery was marred by cost pressures. Cost of Goods Sold rose faster than revenue, increasing by 14.4 percentage points to N1.3 trillion in 2024. In other words, the brewers were spending a lot more to sell fewer beers.
The fear, however, is that even after the recovery of 2025, and the rise in the numbers recorded against revenue and profits, the market might be tanking in a manner that is affecting the hopes of sustainable revival.
It looks like Guinness had seen this earlier and had started running commercials chiefly targeting the Gen Z demographic. Recent commercials run during the English Premier League games feature Gen Z models and showcase them in lifestyles and environments that connect to this segment quite strongly.
The stats on Guinness stout’s performance are not out yet, but this seems like a clear response to what could be explained as the movement of Gen Zs away from beer.
“Everybody talks about Gen Z, but very few people slow down enough to actually listen to them,” said Ayoade Omolola, strategy & intelligence lead at X3M Ideas. “A lot of brand strategy today is still built on stereotypes. We wanted to move away from internet caricatures and understand the real emotional and cultural drivers shaping this generation,” he added.
The report emphatically pointed to shifting market preferences, including a growing inclination toward wine consumption and more curated social experiences among younger consumers.
The report stated that the Gen Z population admitted to being occasional drinkers. Statistically, it was said that 74.3 percent of Gen Zs admitted to drinking rarely or occasionally. With the number quoted as the country’s volume of beer sales in 2024/2025, this stat would have returned more foreboding data. For instance, if in 2024, Nigeria still sold between 1.8 million and 2.1 million hectolitres of beer, then the drop from around 2.5 million hectolitres would have seen the market at around 800,000 to 1.2 million hectolitres.
The 34.2 percent who admitted to drinking alcohol one to three times a month might also be some form of misinterpretation. From what is recorded in beer sales, and from observations of the numbers that are out in the bars every evening, especially on weekends, the situation cannot be that tragic.
I might also not agree that as much as 41.7 percent of respondents said they drink during bonding moments with friends, family and colleagues. This is so because one of the strongest characteristics of Gen Z is that they are mostly isolationists. They hardly congregate and bond mostly through the mediated channels of social media. 41.75 is quite a high number.
Wine importers would be grinning from ear to ear at the section which gives it a 42.4 percent of purchases by the respondents, followed by vodka, at 36 percent and then whiskey, at 32.5 percent. This stat might also be misleading for a couple of reasons. First, the total for the three distributions is 114.5%, and those who were purchasing and consuming beer were not accounted for.
As a committed observer, I have this feeling that Gen Zs are not shifting from beer, because they do not like beer. Factors necessitating this shift are out there in the open, but it seems those who should fight it are helpless.
The first is the counterfeit industry. There are more fake beers in circulation than there are real products. The counterfeiters have become so omnipresent that manufacturers cannot out-innovate them. Changing bottles and labels and including some security features on bottles have become impossible to defeat these guys. They respond as quickly as the beers innovate. Some insist that the real culprits operate along the production chain and are aware of what would come even before it is communicated.
The second reason might be cost. Beer has become quite expensive. A sit-out of four friends would easily cost the host some N20,000 if they are good drinkers. The economy has made this quite unaffordable, compelling many people to resort to the cheaper local drinks, mostly classified as bitters. When binging on this, less than N5,000 could easily get some five people high.
Thirdly is the matter of substances. I am not trying to disparage the young people in our society, but many of them are hooked on substances other than alcohol. There are more varieties of substances in use among the Gen Z age bracket than past generations have ever known. These alternatives to alcohol are killing beer sales.
Lifestyle changes occasioned by an increase in income have also contributed. The Gen Z are borderless. A lot of them are in Nigeria but earn their income in dollars and other major foreign currencies. A lot of people are doing crypto and other businesses. When people like this gather, they migrate upwards to perceivably safer and more expensive drinks. For instance, a bottle of Jameson Black Barrel rose from N5,000 in 2022 to N32,000 at present. Glenfiddich (21 years) has risen from N90,000 in 2022 to more than N350,000 at present.
Beer is therefore losing patrons both at the lower and at the upper segment. People give the excuse of concern for their health and gravitate to whiskey. But the rate at which they pop whiskies and guzzle the contents exposes them to greater health risk than regular beers.
This means that the health concern was a mere excuse to scale up (for the big earners) and manage their meagre income (for those at the low end of the market).
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