Consumer Choices in the Beverage Aisle - US

Published by: Mintel International Group Ltd.

Published: Apr. 1, 2008 - 91 Pages

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... 17

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 64

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 43: Price, packaging and promotional factors influencing purchase, by household income, February 2008 67

Figure 44: Price, packaging and promotional factors influencing purchase, by race/ethnicity, February 2008

Figure 45: Price, packaging and promotional factors influencing purchase, by household size, February 2008

Motivation for trying a new beverage

Figure 46: Motivation for trying a new beverage, by race/ethnicity, February 2008

Figure 47: Motivation for trying a new beverage, by household income, February 2008

Figure 48: Beverage attributes driving purchase, by race/ethnicity, February 2008

Figure 49: 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 50: Incidence of beverage purchase intent before entering store, by household income, February 2008

Figure 51: How often purchases are planned before entering store, by race/ethnicity, February 2008

Beverage attributes driving purchase

Figure 52: Beverage attributes driving purchase, by household income, February 2008

Incidence of purchasing non-alcoholic beverages for special setting

Figure 53: Incidence of purchasing non-alcoholic beverages in special settings, by household income, February 2008

Choice of non-alcoholic beverages in special settings

Figure 54: Choice of non-alcoholic beverages in special settings, by gender, February 2008

Figure 55: Choice of non-alcoholic beverages in special settings, by household income, February 2008

Choice of retail channels to purchase beverages

Figure 56: Where drinks were bought in past week, by gender, February 2008

Figure 57: Where drinks were bought in past week, by household income, February 2008

Figure 58: Where drinks were bought in past week, by race/ethnicity, February 2008

Figure 59: Where drinks were bought in past week, by presence of children in the household, February 2008

APPENDIX: TRADE ASSOCIATIONS

Abstract

• 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.

About MarketResearch.com
MarketResearch.com is an online aggregator selling over 160,000 market research reports, company profiles and country profiles from over 600 research firms. Our reports will provide you with the critical business and competitive intelligence you need for strategic planning and marketing research. Coverage includes the US, UK, Europe, Asia and global markets.