Within the pound;5.4bn soft drinks market, cola may still be king but it’s the healthier drinks that are growing fastest – and you don’t get much healthier than water.
Specialist consultancy, Zenith International, reports that UK bottled water sales rose 5.3% to 2.1bn litres in 2005, which equates to almost pound;1.6bn-worth of retail sales. Zenith research director Gary Roethenbaugh explains: “The merits of proper hydration and the benefits of bottled water to health and wellbeing continue to gain recognition among consumers. And despite phenomenal growth over the past two decades, more consumers are turning to bottled water as their favoured soft drink choice at a steady pace.” What is more, Zenith expects the growth to continue. It forecasts an annual growth rate of 6-8% over the next few years, to reach almost 3bn litres by 2010.
Meanwhile, figures from consumer research company BMRB International’s TGI survey reveal that the percentage of adults aged 15 and above drinking bottled water has jumped from 35% in 2000 to 55% in 2005. The survey also highlights a growing number of male consumers.
The Aqua Pura brand has been quick to cash in on the male water consumer, and has launched a one litre bottle primarily for men. Manufacturer Princes Soft Drinks’ research found that men want larger sports cap water bottles for when they exercise. The brand has close ties with sports via its sponsorship of UK Athletics, and this is highlighted prominently on the new sculpted bottle.
The launch is supported by advertising in fitness magazines and at key fitness shows.
Buxton too has a new one litre bottle. This features an ‘easy open’ thumb-up sports cap, which the company says can be opened one-handed, and it says the bottle is the ideal shape for gripping while on the go.
Highland Spring claims to be the number one brand in the cash and carry sector and, according to ACNielsen data, a quarter of all bottled water sold in cash and carries is Highland Spring. Again, according to ACNielsen, Abbey Well is the number one natural mineral water in UK foodservice. Margaret Johnson, Abbey Well’s trade marketing and national account manager, says the company is constantly monitoring the needs of the marketplace: “We have developed a range of drinks that complies with the recent government guidelines for drinks in schools. Many wholesalers are very concerned about the effect that the guidelines will have on their Features > Business, which is why we have ensured that our wholesalers have a range to supply. Watch this space for a super new range of drinks, which will be available in October.”
Getting kids to drink more water can be difficult but the transition from sugary, fizzy drinks to water has been made easier by the availability of flavoured waters. New product development means value growth in the kids flavoured waters market is rocketing. For kids, smaller bottles are key which is why Buxton has introduced an 8x25cl multipack of its lemon wave and strawberry splash flavoured waters.
Twenty three million litres of pure fruit juice were sold through independent outlets last year. The data comes from ACNielsen Scantrack, MAT Dec 24, 2005, which puts the value of those litres at pound;32m.
Juices with added health benefits are taking the market by storm and pomegranate is up there with the best of them. The Pomegreat juice drink is performing particularly well, its strength being that it’s the only juice drink that’s been approved by Heart UK.
The brand is selling well in the grocery multiples and distributor, RJA Foods, hopes to repeat this success in the independents with the launch of a new 6×1 litre pack specifically for the cash and carry/wholesaler sectors.
RJA Foods managing director Adam Pritchard says: “With consumer interest in pomegranate juice at an all-time high and sales of more than one million litres a month for Pomegreat, the introduction of our six-pack presents a major opportunity for the independent retailer and the catering sectors to tap into the ‘super-juice’ phenomenon.”
Cranberry is another berry with healthy credentials. Ocean Spray’s Cranberry Classic, for example, is rich in antioxidants and anti-bacterial PACs (proanthocyanidins), which are naturally occurring compounds that help stop certain bad bacteria from taking a hold in the body. A new ad campaign emphasises these benefits.
Jonathan Duffin, business development and brand manager for Ocean Spray, says the wholesale channel is important for both its multi-serve and impulse formats, and driving depth of distribution is a key objective for this year.
“Price-marked packs of our ambient range are an excellent way of guaranteeing the promotion is consistent throughout the independent trade. This activity has been running very successfully throughout June for the summer, and is scheduled to break again in November in time for the Christmas season. We also run a number of account-specific promotions, such as one with Nisa on Super Hot Spot ‘2 for pound;1.50′ deals.”
Mindful of consumer demand for better-for-you products, Unilever has launched AdeZ, a fruit juice and soya drink. It is fortified with vitamins and minerals; is dairy-free and made with non-GM soya. It has vitamin C to help support our natural defences, and is said to contain as much calcium as a glass of milk and one-third less calories than most regular fruit juice drinks. It is also low in sugar and fat and contains no preservatives.
Mike Knowland, AdeZ business manager at Unilever, says that he expects the launch of Adez will help to make soya “much more accessible, everyday and mainstream”.
Of course, cash and carries and wholesalers mustn’t forget PepsiCo’s Tropicana, which is the number one juice brand in the UK and is carrying out a lot of work in depots to increase penetration in the cash and carry sector (ProWholesaler, p62, May). In addition, PepsiCo’s apple juice, Copella, will be backed by a pound;3.75m spend.
Coca-Cola Enterprises’ fruit juice offering is Minute Maid Froot Refresh with variants including orange with a squeeze of passion fruit with calcium. Consumers can currently try Froot Refresh free if they pick up bottles of the drink with special ‘try me free’ neck collars. There are 1.4 million such bottles in circulation.
And for kids, CCE is launching Capri-Sun 100% Juice, available in orange and apple flavours. The new drink contains no added sugar or sweeteners, and no additives or preservatives. It also counts as one of the five daily portions of fruit and vegetables recommended by nutritional experts.
Sunny Delight, or Sunny D as it’s now known, has endured a rollercoaster ride of sales highs and lows, however new brand owner, the aptly-named Sunny Delight Beverages Company (SDBC), reckons sales highs will be back thanks to a new 100% pure juice drink fortified with vitamins A, C and E and containing Omega 3. New Sunny D has no artificial colours, flavourings, preservatives or added sugar or sweeteners and has been developed to deliver “unbeatable taste for kids”.
The Appletiser apple juice drink is performing very well in cash and carry/wholesalers as commercial manager James Bruckner explains: “Appletiser is a great accompaniment for food and our focus on caterers has led to the brand’s success in wholesalers like Booker, where we are enjoying volume sales growth of 24% in the past six months. Our new listing in Costco is also exceeding our expectations.”
In the soft drinks market, smoothies are the star performers – but from a very low base. According to the Britvic Soft Drinks Report, take-home sales of smoothies in 2005 were worth pound;79m and recorded 72% sales growth.
However in volume terms, they accounted for just 24 million litres, a less than 1% share of the market. Even though the numbers are small, smoothies is definitely a category to explore, especially as more and more longer-life products are being launched onto the market.
For instance, hot dog specialist Rollover has entered the smoothies market with a product that has a 12-month shelf life. Its Pure Fruit range comes in two flavours: pineapple mango and banana raspberry; in cases of 36x330ml bottles, or in catering packs of 6×1 litre cartons.
The wholesale price of the smoothies is approximately 84p per 330ml bottle and the recommended retail price is pound;1.70- pound;2.29. For the one litre cartons, the price is approximately pound;1.85 per litre.
And The Big J offers two different smoothies lines, both with a six-month shelf life. Its Smoothiepack is 100% pure fruit, with no additives or preservatives, and it is aseptically packaged in 250ml and one litre packs. Its Smoothie Smile 100% pure fruit smoothie is bottled with screwcap and no additives or preservatives.
=== Buyer’s viewpoint ===
Water is our biggest seller by far and Volvic is the brand that people want. We can’t get enough of it – all flavours, all sizes are all selling well. Most of our business is retail but we also supply some schools and because of the emphasis on healthy eating they’ve switched to water too. We’ve had some really hot weather but so far we’ve managed to keep up with demand.
=== retailers seeking better availability OF JUICES AND WATERS in cash CARRY DEPOTS ===
Him quizzed hundreds of retailers on their way into and out of depots for its Cash and Carry Retailer Tracking Programme 2006.
It found that Coca-Cola was the top selling soft drink for most retailers; Evian was the top selling water brand; and Tropicana the top selling juice. In addition, 38% of 1,170 retailers questioned said they purchased own label soft drinks.
Other data gathered included:
l Of 802 retailers questioned, 32% said they bought fizzy soft drinks from a delivered wholesaler; 28% bought still soft drinks from them; and 23% mineral water
l Out of stocks were a problem with 9% (of 441 retailers) failing to buy the fizzy soft drinks they had intended to buy; 9% failing to buy still soft drinks; and 3% failing to buy mineral water
l All the retailers questioned said availability could be better at the depot they were in
l Of 1,611 retailers surveyed, many said they’d given more space to soft drinks in their stores this year; and some said smaller case sizes would help
l Retailers said water accounted for 21% of their soft drinks sales and was allocated 21% of space in their stores
l Grouping by type was the most popular way of merchandising soft drinks
l Bogofs and money-off offers were the most popular type of promotions on soft drinks
l Only 35% of retailers questioned sold multipacks of soft drinks
l 36% said they look at the RRP and then mark up on that
l 23% said they would like to see soft drinks sold from a chiller in depot
=== Buyer’s viewpoint ===
We trade in natural and organic lines and at the moment, because of the weather, everything is selling well. However, if I were to name best sellers then in cans it would be Whole Earth and Santa Cruz organics. In bottles, the small bottles of Bottlegreen press eacute;s are going well. The usual orange and apple juices in TetraPaks are doing well as is Fairtrade’s Fruit Passion drink as more and more people are aware of fair trade. In water we have a brand called Purely Scottish that sells well as does Strathmore and our customers tend to go for glass bottles rather than plastic.