Abstract
Consumers have an ever-growing array of choices in the beverage aisle. These choices are not only driven by tastes, but are increasingly influenced by consumers' need for convenience in all things and their desire for drinks that fit their health and lifestyle goals. Products that offer single-serve packaging and a healthy positioning are the ones that have driven strong sales growth of non-alcoholic beverages during 2002-07.
Consumer analysis covers six non-alcoholic beverage segments-regular and diet soda; fruit juice and juice drinks; bottled water; ready-to-drink tea; sports and energy drinks; and seltzer, tonic and club soda.
This report contains actionable suggestions for industry participants interested in learning about:
- The importance of price as an influence on beverage choices, and what value-added benefits are most likely to override the price.
- How evolving consumer values impact product choice.
- The importance of a healthy image, even among products not generally considered in a health context.
- How shifting demographics impact product mix now and in the future.
- Who is innovating in the marketplace and which innovations Mintel believes are most likely to succeed or fail.
- The fastest-growing brands and which are positioning themselves for future growth.
- Factors prompting trial of new products.
- Incidence of choosing specific drinks only for specific settings, the drinks that fall into this category, and what they are trying to do to get out of it.
- How often purchases are planned in advance vs. impulse and who is more likely to plan.
This report contains US IRI InfoScan data.
Table of Contents
- Scope and Themes
- What you need to know
- Definition
- Data sources
- Sales data
- Consumer survey data
- Television ads
- Store audits
- Abbreviations and terms
- Abbreviations
- Terms
- Executive Summary
- They aren' t just drinks anymore
- Standing out from the "usual" in the beverage aisle
- The two big segments continue to be a sitting target for every growing brand
- Consumers want products that meet dietary requirements
- Bottled water--decelerating, but still growing
- Consumer motivations
- Specific drinks for specific settings
- Market Size
- Key points
- Consumers on an ongoing quest for convenient nutrition
- Price increases promote consumer attrition
- Figure 1: Total U.S. sales and forecast of non-alcoholic beverages at current prices, 2002-12
- Figure 2: Total U.S. sales and forecast of non-alcoholic beverages at inflation adjusted prices, 2002-12
- Competitive Context
- Key points
- Strong brand loyalty and product awareness necessary
- Figure 3: U.S. new non-alcoholic beverage introductions, 2003-07
- Price sensitivity and exception for value add
- Changing consumer values
- Is this beverage natural?
- Is the packaging convenient?
- Is the packaging environmentally friendly?
- Does this brand resonate with my lifestyle?
- Brand identity and innovation
- Line extensions drive short-term growth, but create clutter in the beverage aisle
- Finding a line extension with independent positioning can drive sustainable long-term growth
- Brand extensions command instant consumer recognition but can dilute brand equity and create brand fatigue
- Segment Performance--Overview
- Key points
- Product mix should promote good health and experience
- Carry the product mix to cater to the area' s population profile
- Figure 4: FDM* sales and forecast of non-alcoholic beverages at current prices, by segment, 2002-12
- Figure 5: FDM* sales of non-alcoholic beverages, by segment, 2005 and 2007
- Segment Performance--Carbonated Soft Drinks
- Key points
- Consumers view soda as an unhealthy beverage
- All-natural image for soda may attract health-savvy consumers
- Attracting men may be the key to growing the diet category
- Figure 6: FDM* sales and forecast of carbonated soft drinks, 2002-12
- Segment Performance--Fruit Juice and Juice Drinks
- Key points
- Consumers move away from fruit juices amid calorie concerns
- Figure 7: Ocean Spray cranberry juice, TV ad, 2007
- Figure 8: Ocean Spray 100% Juice, TV ad, 2007
- Consumers wary of artificial ingredients in fruit drinks
- Figure 9: FDM* sales and forecast of bottled, canned, and aseptic juices, 2002-12
- Segment Performance--Bottled Water
- Key points
- Enhanced water promises future segment growth
- Communicate about water purity positioning
- Figure 10: FDM* sales and forecast of bottled water, 2002-12
- Segment Performance--Sports and Energy Drinks
- Key points
- Targeting niche consumers essential for future growth
- Manufacturers should highlight functional platform
- Figure 11: FDM* sales and forecast of sports and energy drinks, 2002-12
- Segment Performance--Bottled and Canned Tea
- Key points
- Tea maintains its healthy image
- Figure 12: FDM* sales and forecast of canned and bottled tea, 2002-12
- Segment Performance--Seltzer, Tonic Water, and Club Soda
- Key points
- Positioning seltzer as a healthier option for soda may drive growth
- Figure 13: FDM* sales and forecast of seltzer, tonic water, and club soda, 2002-12
- Retail Channels
- Key points
- Channel choice is crucial to new product launches
- Figure 14: Retail channel choice to purchase beverages in past week, by age, February 2008
- Supermarkets lose market share to mass and other channels
- Energy drinks guarantee flow of traffic at convenience stores
- Figure 15: U.S. sales of non-alcoholic beverages, by retail channel, 2005 and 2007
- Retail Channels--Supermarkets
- Key points
- Figure 16: U.S. new non-alcoholic beverage introductions, 2003-07
- Need exists for more single-serve options
- Observation: Albertsons, Miami, FL
- Shelves should reflect new products trend
- Figure 17: U.S. sales of non-alcoholic beverages at supermarkets, 2002-07
- Retail Channels--Mass and Other
- Key points
- Observation: Wal-Mart, Dallas, TX
- Figure 18: U.S. sales of non-alcoholic beverages at mass and other channels, 2002-07
- Market Drivers
- Trend towards healthier eating influences beverage choice
- Figure 19: Attitudes regarding healthy eating, 2003-07
- Obesity trends shape up the beverage aisle profile
- Figure 20: Percentage of population who are overweight or obese, 20-74 years of age, 1988-2004
- Figure 21: Attitude and opinion towards artificial sweeteners, March 2008
- Consumers weigh health news and research findings when making beverage choices
- Young adults are the key consumers in the beverage aisle
- Figure 22: Population of adults aged 18-34, 2003-13
- Baby Boomers cut down on beverage consumption with age
- Figure 23: Coca-Cola' s Minute Maid Enhanced Orange Juice, TV ad, 2007
- Households with children key to market growth
- Figure 24: Households with children under age 18 present, 2001-06
- Figure 25: U.S. child and teen population and projections, 2003-13
- Heavier consumption among Hispanics and blacks
- Figure 26: Population by race and Hispanic origin, 2001-13
- Fastest-growing Brands--Carbonated Soft Drinks
- Key points
- Fruit-flavored products appeal to growing Hispanic population
- Opportunities exist for soda brands with pro-health and functional positioning
- Diet brands need to connect with core consumers on taste and brand
identity
- Figure 27: Top carbonated drinks brands in FDM*, 2006 and 2007
- Fastest-growing Brands--Fruit Juice and Juice Drinks
- Key points
- Brands can benefit from value-added positioning
- Consumers want products that meet dietary requirements
- Figure 28: Top aseptic/canned/bottled fruit juice/juice drinks brands in FDM*, 2006 and 2007
- Fastest-growing Brands--Bottled Water
- Key points
- Mid-priced brands getting squeezed out by premium and private label brands
- Enhanced water niche becoming crowded
- Figure 29: Top bottled water brands at FDM*, 2006 and 2007
- Fastest-growing Brands--Sports and Energy Drinks
- Key points
- Sports drink mixes appeal to price-conscious consumers
- Energy drinks consumers want more
- Figure 30: Top sports and energy drinks brands in FDM*, 2006 and 2007
- Fastest-growing Brands--Canned and Bottled Tea
- Key points
- RTD should capitalize on growing interest in wider tea varieties
- Premium and organic likely to remain niche brands
- Figure 31: Top RTD tea brands in FDM*, 2006 and 2007
- Innovation and Innovators
- New product trends
- Figure 32: New product introductions, by drink category, 2003-08*
- Cane juice appeals as a natural sweetener
- Trend towards fruit and vegetable juice fusion
- Gatorade expands drinking occasions
- Attitudes and Motivations
- Key points
- Price, packaging and promotional factors influencing supermarket purchase
- Young adults, the key consumers, are most likely to respond favorably to packaging attributes
- In-store sampling and promotion can be a powerful tool to drive growth in
the beverage aisle
- Figure 33: Price, packaging and promotional factors influencing purchase, by age, February 2008
- Motivation for trying a new beverage
- Price the new beverage right in the retail aisles, compared to the existing alternatives
- Use viral marketing strategies to spread word about the new beverage
- In-store sampling is more effective in selling new beverages, compared to the existing beverages
- Capitalize on existing brand equity, but avoid creating brand fatigue
- Figure 34: Motivations for trying a new drink, by age, February 2008
- Beverage attributes driving purchase
- Increase single-serve packaging in the total product mix
- All-natural and no high-fructose corn syrup could become more important
in the future
- Figure 35: Criteria considered when drinks were bought, by age, February 2008
- Potential for purchase decisions to be made in the supermarket
- Most consumers make their beverage shopping list prior to visiting the
store
- Figure 36: How often drink purchases are planned before going to the supermarket, by age, February 2008
- Specific Drinks for Specific Settings
- Key points
- Incidence of drinking certain beverages only in specific settings
- Figure 37: Incidence of purchasing non-alcoholic beverages in special settings, by age, February 2008
- Figure 38: Incidence of purchasing non-alcoholic beverages in special settings, by race/ethnicity, February 2008
- Figure 39: Incidence of purchasing non-alcoholic beverages in special settings, by presence of children in the household, February 2008
- Beverages drunk only in specific settings
- Figure 40: Beverages drunk only in specific settings, by age, February 2008
- Figure 41: Choice of non-alcoholic beverages in special settings, by race/ethnicity, February 2008
- Figure 42: Choice of non-alcoholic beverages in special settings, by presence of children, February 2008
- Appendix: Other Useful Consumer Tables
- Price, packaging and promotional factors influencing supermarket purchase
- Figure 56: Price, packaging and promotional factors influencing purchase, by household income, February 2008
- Figure 57: Price, packaging and promotional factors influencing purchase, by race/ethnicity, February 2008
- Figure 58: Price, packaging and promotional factors influencing purchase, by household size, February 2008
- Motivation for trying a new beverage
- Figure 59: Motivation for trying a new beverage, by race/ethnicity, February 2008
- Figure 60: Motivation for trying a new beverage, by household income, February 2008
- Figure 61: Beverage attributes driving purchase, by race/ethnicity, February 2008
- Figure 62: Motivation for trying a new beverage, by presence of children in the household, February 2008
- Potential for purchase decisions to be made in the supermarket
- Figure 63: Incidence of beverage purchase intent before entering store, by household income, February 2008
- Figure 64: How often purchases are planned before entering store, by race/ethnicity, February 2008
- Beverage attributes driving purchase
- Figure 65: Beverage attributes driving purchase, by household income, February 2008
- Incidence of purchasing non-alcoholic beverages for special setting
- Figure 66: Incidence of purchasing non-alcoholic beverages in special settings, by household income, February 2008
- Choice of non-alcoholic beverages in special settings
- Figure 67: Choice of non-alcoholic beverages in special settings, by gender, February 2008
- Figure 68: Choice of non-alcoholic beverages in special settings, by household income, February 2008
- Choice of retail channels to purchase beverages
- Figure 69: Where drinks were bought in past week, by gender, February 2008
- Figure 70: Where drinks were bought in past week, by household income, February 2008
- Figure 71: Where drinks were bought in past week, by race/ethnicity, February 2008
- Figure 72: Where drinks were bought in past week, by presence of children in the household, February 2008
- Appendix: Trade Associations
- Beverage Aisle/Beverage World

