Why Sommarøy sees promise in lower-alcohol spirits

The facts are abundantly clear by now — young people are drinking less alcohol. This fact, supported by various bodies of data, has sent legacy beverage companies into a tailspin as they attempt to keep up with an evolving, less alcohol-fueled, social media-savvy generation. With this in mind, Sommarøy Spirits sees a clear path to success.

The Chicago-based upstart produces vodka and gin that contain two-thirds of the alcohol of regular spirits — only 27.5% alcohol by volume and 70 calories per serving. The spirits are designed to be sipped alone or poured into cocktails.

The brand was the pandemic-era brainchild of two Illinoisan entrepreneurs. Michael Barkin had previously worked in consumer goods in the clothing space, but never in food and beverage. James Cosma brings alcohol experience as the owner of a wine wholesaling company, Atlas Imports LLC.

The co-founders realized they were consuming more alcohol while spending more time at home, but regretting hangovers the next morning. They simultaneously noticed nonalcoholic products gaining steam as younger consumers began to negotiate their relationship with booze, and wanted to create smooth, easy-to-drink spirits with less of the negative side effects of alcohol.

“We thought there would be a good amount of whitespace in between nonalcoholic and full-proof offerings for people who still do want to participate in drinking, but who have an understanding and appreciation for some wellness-focused behavior,” Barkin said.

While its products are available nationwide on its website, Sommarøy’s gin and vodka are currently sold in stores like Whole Foods on the West Coast and the Midwest, with plans in the works to launch in the Northeast.

The company’s name, Sommarøy, is a nod to a fishing village in western Norway with under 1,000 residents. While neither of its co-founders have a direct link to the town, they were intrigued by learning that it stays bright there 24 hours a day during its summer months — which they believed fit well with the brand’s sunny vibe.

“You can consume these products from morning to night,” Barkin said. “The whole brand evokes a feeling of ease and sensibility. It’s very calm, light, airy and luxurious.”

Betting on the lower-alc boom

Alcohol consumption is down among younger millennials and Gen Z, with 40% of young consumers reporting they are limiting their consumption in a Mintel study earlier this year. Sommarøy believes it stands to benefit from capitalizing on moderation as it is ascending.

“Be the first to market, be one of the leaders and the innovators of it, be a pioneer for it, and people will reward you with their loyalty for paying attention to them in the early days,” Barkin said.

According to the co-founders, Sommarøy debuted vodka and gin as its first two products based on market data indicating those were the spirits with the greatest reach among U.S. consumers. The brand is currently also formulating a blanco tequila.

While large beverage companies are producing several lower-alcohol RTD drinks to capitalize on growing moderation, the duo discovered that only some brands were producing 750 milliliter spirits bottles that contain lower alcohol by volume.

While Sommarøy believes it is fulfilling a desire for low-alcohol spirits not currently being met in the beverage space, it is aware of its difficulties as a startup brand. According to Barkin, the company is currently well-funded after a generous round from angel investors, but it is aiming to take a methodical approach as consumers familiarize themselves with the drinks — including collaborations with influencers and hosting tastings at festivals.

“What’s exciting about being a startup is that you kind of get to take these big swings, and you have to be calculated with where you make your bets,” Barkin said. “We’ll eventually go after a more meaningful funding round to take this thing to the next step.”

The co-founders also have an eventual “exit” goal involving a bigger player in the beverage space, whether that means a partnership or being acquired entirely. According to Barkin, the brand is in contact with the innovation groups and M&A teams at some of the largest beverage companies.

“We know we’re very early on in the process, but it is our hope,” Barkin said.