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State of the Industry - Beverage Blockbusters 2007
BY JENNIFER ZEGLER
Caribbean invaders, transformers and triumphant heroes not only appeared on movie screens, but also in beverages. The invaders are not big screen pirates, rather Caribbean-inspired flavors that continue to advance across many beverages. More new releases transformed category lines with new drinks that blend two or more categories.
These category transformers are aiming at niche
segments, explains Jeanette Bengtsson, non-alcohol drinks account manager
for Euromonitor International, London.
“With more manufacturers entering emerging
market sectors that are already quite saturated with carbonates, juice and
water, they’re going after niche segments,” Bengtsson says.
“We’re seeing juice/ready-to-drink (RTD) tea mixes,
juice/energy drinks, juice/water, sparkling juices and premium juices, such
as smoothies, that are going for niches.”
And in some categories that have been downtrodden, new
product heroes have enlivened the category.
“In the past year or the past two years, one of
the main trends has been an increase in health awareness,” Bengtsson
says. “Consumers have been worrying more about the content of their
drinks and making sure to eat and drink healthfully. This has led to an
increase in natural products, such as 100 percent juices, smoothies and
low-calorie beverages.”
In the alcohol segment, premium and economy alcohol
drinks are growing, which is squeezing mainstream brands that are caught in
the middle, explains Anne Nugent, alcohol drinks account manager at
Euromonitor International.
Summer is the time when studios roll out their
potential blockbusters and a few beverage categories have experienced the
beverage equivalent of a multi-million dollar opening weekend. Double-digit
growth was reported for energy drinks, RTD tea, RTD coffee and bottled
water, according to data from Information Resources Inc. (IRI), Chicago,
for sales ending May 20, 2007. Only carbonated soft drinks and domestic
beer experienced a “flop,” to borrow the movie industry term
for disappointing performance. Both categories saw single-digit decreases
in the past year.
Is the buzz knocked out of energy drinks?
Though it’s plentiful
with new entries, the category that offers its consumers a boost may have
reached its peak, the data show. Energy drinks are still growing, but
growth is slowing. The category boasted 70 percent growth in 2004 and a 54
percent increase in 2005, according to IRI data. This year’s numbers,
which include 2006 and half of 2007, show a 36 percent lift in sales.
Energy drink’s top performers, such as pioneer
brand Red Bull, remain in the ranks and it seems new entries join each day.
Mintel’s Global New Products Database yields more than 140 new energy
drinks in the past year. With so many new entries, many carve out their
point of difference by target demographic. For 18- to 35-year-old males
there are plenty of testosterone-inspired products with names such as
DareDevil, Power Trip, The Beast and XS Energy Drink.
For consumers who are concerned about a product’s
endorser plenty of celebrity endorsed formulations are out there. Socko has
a product endorsed by former professional wrestler Hulk Hogan, action movie
star Steven Seagal has his own Lighting Bolt line, and Pepsi recently
partnered with racecar driver Jeff Gordon for a limited-edition energy
drink called 24 High Octane.
Carbonated soft drink player, Coca-Cola Co., Atlanta,
had a large gainer in its hybrid energy drink/carbonated soft drink Vault.
The brand reported a 781 percent growth. The
growth was so convincing, it added berry-flavored Vault Red Blitz this
March to the lineup. Coca-Cola also expanded its Full Throttle line with a
Blue Demon variety, which was inspired by the Hispanic wrestling legend of
the same name.
Top 10 energy drinks (individual brands) | |||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
red bull | $301,757,200 | 19.3% | 41.5 | -5.7% | |
monster energy | $111,701,900 | 70.8% | 15.4 | 3.2% | |
rockstar | $85,969,880 | 52.6% | 11.8 | 1.3% | |
full throttle | $47,512,540 | 43.8% | 6.5 | 0.4% | |
sobe no fear | $35,579,070 | 33.7% | 4.9 | -0.1% | |
amp | $26,260,140 | 18.7% | 3.6 | -0.5% | |
sobe adrenaline rush | $17,735,360 | 17.4% | 2.4 | -1.6% | |
tab energy | $14,626,450 | 212.5% | 2.0 | 1.1% | |
powerade | $10,719,600 | 117.6% | 1.5 | 0.6% | |
monster energy xxl | $8,033,378 | 230.8% | 1.1 | 0.7% | |
Category total | $727,391,000 | 35.8% | 100.0 | — | |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Global functional drink volume (millions of liters) |
||
CATEGORY | 2006 | FORECAST 2011 |
SPORTS DRINKS | 9,870.6 | 13,301.7 |
ENERGY DRINKS | 2,429.4 | 3,534.1 |
ELIXIRS | 320.7 | 366.1 |
TOTAL | 12,620.7 | 17,201.9 |
Source: Euromonitor International, 2007 |
Hispanics have become a big target for energy drink
formulations with Spanish names and regional flavors. Caballo Negro by
Distribuidores De La Energia Inc., Burlingame, Calif., features Spanish
language packaging. Chicago-based Tampico entered the category last summer
with Tampico Energy. Also new is Potencia energy drink, which featured its
Tamarind flavor at tradeshows this spring.
Females also are a target for energy drink makers who
have rolled out daintily packaged products that pack a punch. Coke’s
Tab Energy holds the No. 8 spot in IRI’s Top 10 energy drinks with
nearly $15 million in sales. In addition, brands such as HER, Go Girl and
Rip It Chic also use pink packages to attract female consumers.
Natural energy is another segment of the market that
increased this year. Hydrive from the same-named Rye, N.Y.-based company,
uses spring water as its base. Naked Juice, Azusa, Calif., rolled out its
energy smoothie line in the spring of 2006, which has grown to include
three flavors that have one pound of fruit and 43 mg. of caffeine in every
bottle.
Juice also has been leveraged as a base for extensions
in the Rockstar, Kronik and BooKoo portfolios. Better known for its
produce, Del Monte entered into energy drinks last month with Bloom energy.
The drink has real fruit, antioxidants and calcium. Bloom launched in Mango
Passionfruit, Wild Berry and Cran Raspberry varieties.
Surf’s up for flavored, functional waters
Consumers are well aware of
the benefits of drinking eight 8-ounce glasses of water a day. The trouble
is, they have a hard time complying. To help consumers get hydrated,
companies have released a vast array of flavored and functional waters.
In January, Pepsi got into the enhanced water field
with Aquafina Alive. The extension of the $523 million Aquafina brand is
low in calories and vitamin enhanced. Each of the three flavors, Berry
Pomegranate, Peach Mango and Orange Lime, are made with a splash of fruit
juice.
Global bottled water volume (millions of liters) |
|||
CATEGORY | 2006 | FORECAST 2011 | |
STILL BOTTLED WATER | 143,103.0 | 194,449.8 | |
CARBONATED BOTTLED WATER | 29,904.7 | 34,425.0 | |
FLAVORED BOTTLED WATER | 4,464.0 | 7,704.6 | |
FUNCTIONAL BOTTLED WATER | 2,488.1 | 4,388.9 | |
TOTAL | 179,959.8 | 240,968.3 | |
Source: Euromonitor International, 2007 |
Top 10 bottled waters (individual brands) |
||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR |
private label | $569,050,700 | 21.0% | 14.8 | 0.5% |
aquafina | $523,757,100 | 12.8% | 13.6 | -0.5% |
dasani | $458,441,900 | 19.3% | 11.9 | 0.2% |
poland spring | $267,001,100 | 18.4% | 6.9 | 0.1% |
glacéau vitaminwater | $226,389,400 | 118.1% | 5.9 | 2.7% |
propel | $194,665,200 | -2.4% | 5.1 | -1.0% |
arrowhead | $181,921,700 | 12.6% | 4.7 | -0.2% |
deer park | $148,766,700 | 20.5% | 3.9 | 0.1% |
crystal geyser | $108,070,300 | 31.9% | 2.8 | 0.3% |
nestlé pure life | $103,321,300 | 55.1% | 2.7 | 0.7% |
Category total | $3,849,570,000 | 17.0% | 100.0 | — |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Coca-Cola’s Dasani ranks third on IRI’s
Top 10 and expanded its brand with the addition of Dasani Plus this spring.
Flavored and fortified, the line is available in three formulations all
with zero calories. Cleanse + Restore, Refresh + Revive, and Defend +
Protect all have added vitamins and minerals to achieve their individual
intended benefits.
Coca-Cola-owned Odwalla also announced its new line of
H2Odwalla enhanced waters. Launched in February, H2Odwalla comes in five
flavors with organic ingredients and is sweetened with evaporated cane
juice. The line is focused around a Replenishment theme and features
flavors such as Jasmine Lime, Ginger Plum and Blueberry Tea.
Known for its quirky soft drinks, Jones Soda
introduced its 24C line early this summer. The line of vitamin-enhanced
waters and powdered drink mixes are formulated to provide daily
requirements of several vitamins and minerals. 24C launched in six flavors,
including Mandarin Orange and Berry Pomegranate.
Following the revamp of its traditional sparkling
water line, Clearly Canadian introduced a new line of natural enhanced
water this spring. Available in dailyHydration, dailyEnergy, and
dailyVitamin, each formulation has two fruit flavored options. All are made
with artesian Canadian water and vary in flavor from traditional Lemon to
tangy Pink Grapefruit.
The combination of fruit flavors and water also
appeared in premium waters by O Beverages as well as new entries. Kraft
reintroduced its Fruit20 line in April, now with fruit flavors as well as
functional benefits. Last month, Pepsi’s Tropicana brand introduced
Fruit Squeeze. Tropical Tangerine, Summer Lemon, Pink Grapefruit and Lime
Raspberry all have a ‘squeeze’ of Tropicana fruit juice and 20
calories per serving.
Among IRI’s Top 10 brands, only two are strictly
flavored water brands. Pepsi’s Propel Fitness water extends from its
Gatorade sports drink line and had $194 million in sales. The brand also
released stick packs for on-the-go mixing of the product.
Just above Propel is Glacéau’s
Vitaminwater with $226 million in sales. This year, Vitaminwater added a
new Lemon-Lime flavor with electrolytes as well as Vitaminwater XXX, which
is flavored with antioxidant-rich acai, blueberry and pomegranate. The
brand also made headlines following last month’s sale to Coca-Cola.
Getting water into lunch boxes was a focus for other
companies as well. Vitaminwater rolled out 12-ounce packaging of its most
popular flavors. Kids Only LLC, Westborough, Mass., uses cartoon characters
Spiderman, Scooby-Doo and Bratz to entice children.
Other companies have added hints of flavor to
encourage sipping. Wateroos, San Francisco, added Berry and Grape flavors
to its lineup of all-natural water in a box. In addition, Coca-Cola’s
Minute Maid and Kraft’s Capri Sun added flavored waters in flexible
pouches.
Soft drinks slim down
The better-for-you beverage
trend has not worsened the slump carbonated soft drinks have been
experiencing, but it has not helped either. Combined data from IRI and
ACNielsen show the category dropped 3.8 percent this year. On the bright
side, that’s a 0.01 percent improvement since 2005.
Overall, the CSD category saw few new product
introductions as traditional CSD manufacturers focused on expanding their
portfolios in energy drinks, juice, water and tea. Out of the vast lineups
from Coca-Cola, PepsiCo and Cadbury Schweppes, only 14 brands showed
positive gains in 2006. In terms of new products, Coca-Cola and PepsiCo
released mostly no-calorie formulations.
Coca-Cola reported small gains worldwide, but North
American case volume declined 2 percent from the prior year. Trademark
Coca-Cola, Sprite and Fanta had 3 percent gains globally, while in North
America, CSD/energy drink hybrid Vault, Fresca and Fanta reported gains.
Part of Coca-Cola’s focus was the development of
its Coca-Cola Zero brand. The no-calorie soda is formulated with a blend of
sweeteners, aspartame and acesulfame potassium to taste more like trademark
Coca-Cola than Diet Coke. The brand launched in June 2005, and reported an
82 percent increase in sales in 2006.
The Coke Zero line also was extended, welcoming Cherry
Coke Zero in February and Vanilla Coke Zero in May. The company also
re-introduced regular Vanilla Coke, which had been pulled from shelves at
the end of 2005. Another addition to the portfolio was Diet Coke Plus.
Boasting the same taste as the No. 1 diet CSD, Diet Coke Plus has added
vitamins and minerals.
PepsiCo experienced single-digit declines for flagship
Pepsi and Mountain Dew, but that was offset by single-digit increases for
its Sierra Mist lineup.
Pepsi also unveiled a massive marketing and
repackaging campaign at the start of 2007. Aimed at attracting a younger
demographic, Pepsi-Cola cans, bottles and cups will receive new graphics
every few weeks. The graphics, some designed by celebrities, will change 35
times this year to reflect images of sports, music, fashion and cars. The
company also introduced limited-edition aluminum Mountain Dew bottles in
May. As part of the Green Label Art campaign, the packages will feature
rotating designs through October.
Global carbonate volume (millions of liters) |
||
SUBSECTOR | 2006 | FORECAST 2011 |
COLA CARBONATES | 111,809.7 | 121,616.6 |
NON-COLA CARBONATES | 81,993.7 | 92,592.4 |
TOTAL | 193,803.4 | 214,209.0 |
Source: Euromonitor International, 2007 |
Top 10 soft drink brands by volume | ||||
BRAND | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
coca-cola classic | -4.8% | 13.5 | -0.1% | |
pepsi-cola | -6.2% | 11.9 | -0.3% | |
diet coke | -2.2% | 7.7 | 0.1% | |
MOUNTAIN DEW | -0.3% | 6.8 | 0.2% | |
PRIVATE LABEL FLAVORS | -8.6% | 5.0 | -0.3% | |
diet pepsi | -3.6% | 5.7 | 0.0% | |
DR PEPPER | -3.1% | 4.6 | 0.0% | |
SPRITE | -4.7% | 5.1 | 0.0% | |
PRIVATE LABEL COLAS | -4.8% | 2.4 | 0.0% | |
CAFFEINE-FREE DIET COKE | -8.9% | 2.2 | -0.1% | |
Source: Information Resources Inc./ACNielsen; food, drug, mass merchandise (excluding Wal-Mart), convenience and gas sales for full-year 2006. |
Soft drink volume by company | |||
COMPANY | % change a YEAR AGO | VOLUME share | VOLUME share change VS. YEAR AGO |
Coca-Cola | -3.6% | 35.9 | 0.1% |
Pepsi-Cola | -4.4% | 34.5 | -0.2% |
Cadbury Schweppes | -0.9% | 18.2 | 0.5% |
Category Total | -3.8% | 100.0 | — |
Source: Information Resources Inc./ACNielsen; food, drug, mass merchandise (excluding Wal-Mart), convenience and gas sales for full-year 2006. |
In addition, Pepsi was active in launching no-calorie
formulations this year. Its diet CSDs experienced slight increases in the fourth quarter of 2006. The company reported a
7.4 increase in sales for Diet Wild Cherry Pepsi. It also rolled out a
sampling program for its reformulated Diet Mountain Dew. Now with a blend
of sweeteners, 3 million cans of Diet Mountain Dew were handed out in
cities nationwide.
The caffeine content of Diet Mountain Dew was used as
a benchmark in materials for Pepsi’s latest extension, Diet Pepsi
Max. Released nationwide last month, Diet Pepsi Max packs one-third more
caffeine than the citrus soda and has added ginseng.
For consumers turning to CSDs for a sweet fix, Pepsi
rolled out Jazz last July. Pepsi Jazz is a no-calorie cola that taps into
sweet cravings with its flavors. Initially launched in Black Cherry French
Vanilla and Strawberries & Cream, Jazz added Caramel Cream flavor in
March. Flavors are another focus for a rumored fall launch. Pepsi plans to
release Tava with Caribbean-inspired flavors
and bills it as a “sparkling fortified fruit drink.”
While the company’s beverage division is mired
in sales talks, Cadbury Schweppes reported the smallest sales decrease of
the soft drink giants. To boot, the company’s Sunkist and A&W
flavors posted the largest gains with 9.4 percent and 7 percent,
respectively. The company also unified its diet line with updated packaging
that spanned its Sunkist, A&W, Canada Dry and 7 UP product lines.
Its Diet 7 UP also launched in a reformulated version
this spring. The new formulation touts more lemon-lime taste and features
aspartame and acesulfame potassium as sweeteners. In addition, regular 7 UP
began a marketing campaign for its “100 percent natural
flavors” following controversy with its “all natural”
tagline. Some consumer groups had taken issue with the characterization of
high fructose corn syrup as an all-natural ingredient.
The company’s flagship Dr Pepper also received
new packaging as well as line extensions. Dr Pepper’s Soda Fountain
Classics line experienced declines from its initial release last year. Its
Cherry Vanilla flavor had a 36 percent decrease, but it did extend the line
with Berries & Cream last spring.
Top 10 canned and bottled teas (individual brands) | |||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
arizona | $282,476,400 | 15.6% | 26.0 | -3.1% | |
lipton | $221,921,600 | 146.9% | 20.4 | 9.7% | |
snapple | $126,145,000 | 21.3% | 11.6 | -0.8% | |
lipton brisk | $87,889,870 | 7.6% | 8.1 | -1.6% | |
Diet snapple | $85,600,960 | -4.8% | 7.9 | -2.8% | |
nestea | $61,307,530 | 275.7% | 5.6 | 3.7% | |
lipton iced tea | $60,959,570 | 31.8% | 5.6 | 0.1% | |
private label | $32,653,170 | 8.0% | 3.0 | -0.6% | |
Nestea enviga | $16,657,580 | n/a | 1.5 | 1.5% | |
nestea diet | $14,126,890 | 184,653.7% | 1.3 | 1.3% | |
Category total | $1,086,888,000 | 29.5% | 100.0 | — | |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Tea continues hot streak
Ready-to-drink teas may be
served cold, but the category is on a hot streak. It is the only category
this year that continued building on past year increases. In 2005, the
category reported a 12.8 percent increase, last year a 22.6 percent
increase and this year sales have jumped 29.5 percent.
Whether it’s the healthy benefits of tea or the plethora of varieties and flavors, consumers
are flocking to the category. Introductions include a new
“blue” tea as well as a wide variety of flavors to complement
the white, green, black and red variations already on the market.
Extending the colors of tea, New Leaf from Skae
Beverage International, Orangeburg, N.Y., released a line of blue teas in
the spring. The product gets its name from the hue of oolong tea. The
company partnered the tea with Lemon, Peach and Raspberry flavors that are
organically sweetened. It also revamped the packaging on its entire line of
teas.
While the focus had shifted to green, red and white
teas, a few companies reintroduced their traditional black tea lines. The
category’s No. 2 brand, Lipton, was re-branded as Pure Leaf and
rolled out in six options of black tea in addition to green and white this
spring. In April, Snapple re-branded its Classic Black Tea range with Earl
Grey, English Breakfast and Orange Pekoe varieties. The brand holds the No.
3 position on IRI’s Top 10 canned and bottled tea with its extensive
lineup of plain, sweetened and flavored white, green, diet green, red and
classic black teas.
Flavors also extend the reach of tea. The
category’s No. 1 seller, Arizona iced tea, blended its teas with 50
percent juice for a new option. Debuting in late 2006, Arizona offers
Apple, Pomegranate and White Grape Green Teas. In May, Kraft introduced
Tazo Iced Teas in White Cranberry, Berryblossom White, Diet Green Mojito
and Diet Giant Peach. Bethesda, Md.’s Honest Tea’s newest
addition Pomegranate White Tea with Acai combines trendy high-antioxidant
ingredients.
Also combining traditional flavors with tea, Sweet
Leaf, Austin, Texas, rolled out new packaging for its Tea and Half and Half
line of tea mixed with Lemonade. Relative newcomer Pom introduced Pom Tea,
which blends its Pom Wonderful pomegranate juice with green and black tea.
The line extended from its initial reusable single-serve glass to a larger
jug due to its popularity.
Extending its bottled iced tea line, Republic of Tea,
Novato, Calif., worked with women’s nutrition brand Luna for a new
line. Republic of Tea’s Luna iced tea range was introduced in March
in five flavors and the teas feature Luna’s color scheme and graphics
from its nutrition bars.
Also formulating tea with health benefits, Ito En,
Brooklyn, N.Y., partnered with well-known integrative medicine doctor
Andrew Weil to develop a line of tea beverages. The Dr. Andrew Weil for Tea
line was introduced this spring in 245-ml. cans of RTD teas as well as
loose-leaf teas.
In addition to its Gold Peak line, Coca-Cola partnered
with Nestlé to bring a calorie-burning tea-based beverage to market.
Enviga uses the EGCG in green tea to reportedly burn calories. The brand
reported more than $16 million in sales in its debut year. Building on the
functional platform, Coca-Cola announced plans to create a tea-based
nutraceutical beverage with cosmetics company L’Oreal. The company
also acquired Fuze Beverage LLC, Englewood, N.J., early this year.
Top 10 ready-to-drink coffees (Individual brands) |
||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR |
Frappuccino | $183,085,500 | 6.3% | 72.0 | -9.2% |
doubleshot | $27,340,100 | -1.6% | 10.8 | -2.4% |
starbucks iced coffee | $12,316,720 | 5,582.6% | 4.9 | 4.7% |
bolthouse | $11,298,480 | 635.1% | 4.4 | 3.7% |
doubleshot light | $10,340,570 | 1,477.8% | 4.1 | 3.8% |
godiva belgian blends | $7,060,123 | n/a | 2.8 | 2.8% |
cinnabon | $493,432 | n/a | 0.2 | 0.2% |
caffe d’vita | $363,612 | 58.8% | 0.1 | 0.0% |
hillside | $358,157 | 125.4% | 0.1 | 0.1% |
havana | $276,739 | -26.7% | 0.1 | -0.1% |
category total | $254,196,600 | 19.9% | 100.0 | — |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
RTD coffee gets re-animated
In the ready-to-drink
coffee sector, iced coffee is hot. Starbucks’ Iced Coffee found its
niche and fellow chain Caribou Coffee is getting into the mix with an RTD
deal with Coca-Cola. In addition to other entries and popular favorites,
the category reported a nearly 20 percent increase in sales according to
IRI data.
Seattle’s Starbucks has built a brand that is
nearly synonymous with coffee. It also has expanded this appeal with its
RTD options that have a stronghold on the market. Starbucks’
Frappuccino, Doubleshot, Iced Coffee and Doubleshot Light hold four places
on IRI’s Top 10 RTD coffee list. Together, the brands, which are made through a venture with PepsiCo, boast $233 million in
sales in a category where sales total $254 million.
Global RTD tea and coffee volume (millions of liters) |
||
2006 | FORECAST 2011 | |
RTD TEA | 20,755.3 | 27,751.5 |
RTD COFFEE | 2,817.6 | 3,241.3 |
Source: Euromonitor International, 2007 |
Competitor Coca-Cola is still building its RTD coffee
portfolio. In addition to the cola/coffee fusion soft drink, Coca-Cola
Blak, the company released Godiva Belgian Blends nationally last summer.
The product blends coffee with indulgent flavors such as French Vanilla,
Dark Chocolate and Milk Chocolate and is now the No. 6 brand, according to
IRI data.
In November, Coca-Cola announced a partnership with
Caribou Coffee and will launch the products this summer. The line of RTD
iced coffees is positioned as premium and will be available in Regular Iced
Coffee, Vanilla Iced Coffee and Iced Coffee Plus Espresso.
Also introduced last year, BYB Brands, Charlotte,
N.C., rolled out Cinnabon Premium RTD coffees. The line ranks seventh on
IRI’s list for its sales of Cinnabon Vanilla Latte, Carmel Nut Latte,
Espresso & Cream and Mocha Latte. The drinks also are formulated to be
all natural. Initially launched in the Southeast United States, Cinnabon
coffees have expanded distribution through a partnership with Cadbury
Schweppes.
Weighing in at No. 4 on the list are Bolthouse’s
RTD coffee-based smoothies. The California-company’s lineup is
stocked in the produce section and is mostly made up of juice and
smoothies, but its two coffee-based Perfectly Protein options have garnered
$11 million in sales. In April, the company introduced Hazelnut Latte,
which is based on Arabica coffee and accented with low-fat milk, whey
protein and a touch of roasted hazelnut.
In contrast to the chilled options, self-heating
coffees from OnTech’s Hillside Coffee brand also made the Top 10. The
California company’s self-heating package offers the convenience of
heating its four varieties of coffee on demand. The products are available
in Hazelnut Latte, Mocha Latte, Double Shot Latte and French Vanilla Latte.
Magic of juice boosts sales
With new information on the benefits of
fruit juice, sales for both bottled shelf stable and refrigerated juices
were up 4 percent this year. Beyond traditional vitamin C benefits, it was
reported that orange juice also may reduce the risk of Alzheimer’s
disease, among other benefits. Despite supply issues, this year yielded a
plentiful harvest for functional varieties, premium and organic bases and
new varieties of juice.
This year saw both Coca-Cola Co. and PepsiCo increase
the prices of their orange juice due to crop shortages. Coca-Cola’s
Minute Maid and Simply Orange brands increased 9 to 11 percent; while
Pepsi’s Tropicana and Dole brands raised 4 to 8 percent. Consumers
were not deterred as orange juice boasted $2.8 billion in sales and a 3
percent increase, according to IRI’s figures.
The sales figures could have led to extensions from
the brands. Coca-Cola’s Minute Maid introduced a line of enhanced
orange juices fortified for specific benefits. The line includes Minute
Maid Active with added glucosamine, Heart Wise with plant sterols for
cholesterol reduction, and 16 added vitamins and minerals are in the
Multi-Vitamin variety.
In April, Minute Maid introduced Breakfast Blends. A
line of citrus-based juices that provide 100 percent of the daily value of
vitamin C in Citrus, Tropical and Berry flavors. Also from the beverage
giant, Simply Orange announced in May that it will add single-serve carafes
of orange juice to its lineup, and announced it will expand the line to
include Apple and Grapefruit varieties as well. Last month, Coca-Cola inked
a deal with Campbell Soup to distribute V8 juices and Campbell’s
tomato juice.
At Pepsi, Tropicana introduced Pure Premium juices
last fall. The upscale juices are stocked in the produce section in arched
bottles. The brand also introduced Tropicana Pure Premium Orange Juice with
Omega-3 for heart health benefits. Last month, the brand announced a new
100 percent juice Organic line. Tropicana Organics launched with Orchard
Medley and Orange Juice varieties.
Organic is a hot topic in the juice arena. In addition
to Tropicana, Florida’s Natural, Tree Ripe, Old Orchard and
Mott’s brands all released organic varieties this year. Whether
it’s a single fruit juice or a blend, organic is a differentiator
that helps appeal to discerning consumers.
Global juice drink volume (millions of liters) |
||
CATEGORY | 2006 | FORECAST 2011 |
JUICE DRINKS (UP TO 24% JUICE) | 17,915.1 | 21,710.8 |
NECTARS (25-99% JUICE) | 10,562.3 | 13,336.0 |
FRUIT-FLAVORED DRINKS (NO JUICE CONTENT) | 2,914.2 | 3,388.9 |
TOTAL | 52,825.8 | 63,218.3 |
Source: Euromonitor International, 2007 |
Top 10 refrigerated juices by variety | ||
variety | dollar sales | % change vs. prior year |
orange juice | $2,753,306,000 | 3.4% |
fruit drink | $689,389,900 | -2.0% |
blended fruit juice | $270,838,500 | 10.1% |
lemonade | $167,034,100 | 24.9% |
juice and drink smoothies | $123,349,900 | 48.6% |
grapefruit juice | $69,711,700 | 4.3% |
cider | $53,034,570 | 4.1% |
vegetable juice/cocktail | $29,478,800 | -5.0% |
fruit nectar | $20,254,030 | 7.4% |
pineapple juice | $14,152,170 | 7.8% |
category total* | $4,283,626,000 | 4.3% |
* Includes categories not shown Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Top 10 bottled juices by variety | ||
variety | dollar sales | % change vs. prior year |
fruit drinks | $756,516,400 | -5.9% |
cranberry cocktail/juice drink | $686,607,400 | 5.6% |
apple juice | $531,809,600 | -0.2% |
fruit juice blend | $338,070,300 | 25.3% |
tomato/vegetable juice/cocktail | $260,068,400 | 10.1% |
grape juice | $224,000,600 | -1.4% |
cranberry juice/blend | $174,320,000 | 14.5% |
lemonade | $123,726,100 | -4.4% |
prune/fig juice | $93,590,550 | 13.1% |
cider | $81,445,450 | 3.3% |
category total* | $3,735,450,000 | 3.9% |
* Includes categories not shown Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Top 10 bottled sports drinks (individual brands) |
|||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
gatorade | $684,193,900 | -2.7% | 43.4 | -4.3% | |
powerade | $211,228,300 | 7.3% | 13.4 | 0.1% | |
gatorade frost | $144,344,000 | 1.4% | 9.2 | -0.5% | |
gatorade rain | $137,918,600 | 249.6% | 8.7 | 6.1% | |
gatorade all stars | $118,951,300 | 19.8% | 7.5 | 0.8% | |
gatorade fierce | $94,361,780 | -11.7% | 6.0 | -1.3% | |
gatorade x factor | $92,338,850 | -8.6% | 5.9 | -1.0% | |
gatorade am | $21,330,730 | n/a | 1.4 | 1.4% | |
powerade option | $17,886,990 | 62.1% | 1.1 | 0.4% | |
gatorade xtremo | $15,969,610 | -28.5% | 1.0 | -0.5% | |
category total | $1,577,287,000 | 6.9% | 100.0 | — | |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Premium also has become a key word for juice. The move
to the produce section has set some brands, such as Pom Wonderful and
Bolthouse Farms, apart while others emphasize their upscale bases. The
premiumization of the category inspired PepsiCo to acquire smoothie company
Naked Juice in late 2006. The Azusa, Calif.-company is known for its juice
smoothies that have a pound of fruit in every bottle. PepsiCo also acquired
sparkling juice maker Izze to expand its portfolio.
For parents concerned about a product’s makeup,
100 percent juice blends offer an option. Kraft brand Capri Sun released a
100 percent juice pouch last month. Nestlé’s Juicy Juice
expanded the reaches of children’s juices with Harvest Surprise.
Similar to the remainder of the Juicy Juice lineup, Harvest Surprise is 100
percent juice, but combines fruit and vegetable juices.
Products, such as Frutzzo’s line of pomegranate
blends, continue the popularity of the high-antioxidant fruit. Yet,
consumers are looking for the next big thing, which has juice producers
getting creative. In the past year new varieties of acai, cherry, plum,
watermelon and aloe vera juices have come to market — all touting
their health benefits.
Sports drink rookies rush in
Similar to professional
sports, the sports drink category has its own stars. Powerhouse brands
Gatorade and Powerade continue to dominate. But
new brands — with a competitive edge — are adding to the
category. Their formulations appeal to industry trends, such as natural and
organic formulations.
Gatorade continues to dominate the competition and
though some of its flavors slipped, others boasted increases. The
brand’s largest gainer was Gatorade Rain, which is formulated for a
lighter flavor that finishes clean, according to the company. Rain
experienced a 376 percent increase, according to IRI data, and introduced a
new Strawberry-Kiwi flavor early this year. Its newest formulation,
Gatorade A.M., rolled out in December and racked up $21 million in sales
for a spot in the Top 10. It was formulated to replenish fluids and energy
lost during sleep and comes in breakfast-inspired flavors such as Orange
Strawberry.
Coca-Cola’s Powerade holds two spots in
IRI’s Top 10, but was not active in launching new products this year.
Following the company’s purchase of Glacéau, Coca-Cola
announced the Vitaminwater-maker will run its Powerade brand.
Another CSD giant, Cadbury Schweppes joined the arena
with the acquisition of the Accelerade brand from PacificHealth
Laboratories. Unlike its competitors, the brand uses a protein base to fuel
workouts. The drink has a patented four-to-one carbohydrate-to-protein
ratio and re-launched in four flavors.
For athletes who are concerned about the natural appeal
of their sports drinks, several rookie formulations are going all natural.
Made by R.W. Knudsen Family, Orrville, Ohio, Recharge is made with 50
percent juice, water and sea salt for a natural source of electrolytes.
Also emphasizing its wholesome roots is LIV Natural by Princeton,
N.J.-based Ritorna Natural. The brand launched in the summer of 2006 in the
initial Lemon and Berry flavors and added an Orange flavor this spring.
Craft, import beers relieve sluggish sales
The U.S. beer industry is
battling its way back from several years of sluggish sales. Brewers shipped
207.6 million 31-gallon barrels of beer last year, up from 2005’s
203.5 million, and per capita consumption of beer edged slightly higher to
30.3 gallons per person (age 21 and older) in the United Sates, according
to the Beer Institute, Denver.
Global beer volume (millions of liters) |
||
2006 | FORECAST 2011 | |
TOTAL BEER | 162,357.2 | 184,087.1 |
Source: Euromonitor International, 2007 |
Top 10 domestic beers (Individual brands) | |||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
bud light | $1,421,916,800 | 3.1% | 34.9 | 1.3% | |
budweiser | $760,953,408 | -5.4% | 18.7 | -0.9% | |
miller lite | $727,616,256 | 0.2% | 17.8 | 0.2% | |
coors light | $633,033,536 | 2.6% | 15.5 | 0.5% | |
miller genuine draft | $170,896,928 | -7.0% | 4.2 | -0.3% | |
budweiser select | $118,069,848 | -16.1% | 2.9 | -0.5% | |
coors | $62,024,252 | -9.0% | 1.5 | -0.1% | |
icehouse | $58,397,072 | -1.6% | 1.4 | 0.0% | |
yuengling traditional lager | $37,809,616 | 16.7% | 0.9 | 0.1% | |
bud ice | $23,844,368 | -4.1% | 0.6 | 0.0% | |
category total | $4,079,505,664 | -0.7% | 100.0 | — | |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Beer’s mainstay brands, including Bud Light,
Budweiser, Miller Light and Coors Light, continued their market dominance,
but consumers are considering imports and craft beers more than in the
past. Consumers’ sense of adventure or desire for a change of pace
could be why IRI data reports a 9 percent increase in sales of imported
beer and 17 percent rise in sales for craft beer.
Top 10 imported beers (individual brands) |
|||||
BRAND | DOLLAR SALES | % CHANGE VS. PRIOR YEAR | MARKET SHARE | % CHANGE VS. PRIOR YEAR | |
corona extra | $495,211,072 | 4.3% | 25.4 | -1.2% | |
heineken | $306,800,256 | 4.5% | 15.7 | -0.7% | |
corona light | $128,799,576 | 10.4% | 6.6 | 0.1% | |
tecate | $88,567,648 | 7.0% | 4.5 | -0.1% | |
heineken premium light lager | $64,975,316 | 531.1% | 3.3 | 2.8% | |
modelo especial | $56,525,492 | 23.2% | 2.9 | 0.3% | |
newcastle brown ale | $50,291,344 | 16.6% | 2.6 | 0.2% | |
labatt blue | $50,121,964 | -3.0% | 2.6 | -0.3% | |
guinness draught | $49,685,832 | 8.5% | 2.6 | 0.0% | |
becks | $48,806,192 | 1.5% | 2.5 | -0.2% | |
category total | $1,949,829,632 | 9.3% | 100.0 | — | |
Source: Information Resources Inc., Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending May 20, 2007. |
Although domestic beers experienced a 0.7 percent
decrease, the major breweries are not considered down for the count.
Anheuser-Busch, St. Louis, carries the No. 1 and No. 2 selling domestic
beers with its Bud Light and Budweiser brands, respectively. But the
company has reinvented itself under the control of its new President and
Chief Executive Officer August Busch IV. The brewery restructured its sales
organization to be closer to key retail customers, placed a greater focus
on new product development and new partnerships with import and craft
beers. It made notable additions to its portfolio, including Grolsch, Goose
Island, Stella Artois, Rolling Rock and Tiger beers. Anheuser-Busch also
placed renewed focused on on-premise channels, promoting its brands in
nightclubs, bars and restaurants.
Another brewer that has used on-premise momentum to
boost sales is Molson Coors Brewing Co., Golden, Colo. The company’s
Blue Moon has quietly turned into one of the hottest brands in the beer
business, selling a reported 400,000 barrels in 2006. The Belgian-style
wheat beer has performed well in on- and off-premise outlets alike. Coors’ flagship product, Coors Light, also fared well
during the past year, with 2.6 percent growth in FDM outlets.
Of the three major U.S. brewers, Miller Brewing Co.,
Milwaukee, Wis., struggled most during the past year. During the first half
of the 2007 financial year, SABMiller reported its North American
operations lost 1 percent revenue growth, and the company indicated
full-year 2006 sales were up 1 percent. Miller Lite held onto its spot at
No. 3 in IRI’s Top 10, reporting only incremental 0.2 percent growth.
Despite new packaging, Miller Genuine Draft fell nearly 7 percent this
year.
While mainstream brands have been sluggish, imports and craft beers have the industry buzzing. Import
beers brought in nearly $2 billion in sales from FDM outlets. Within
imports, nine brands in IRI’s Top 10 brand experienced increases.
Craft beers report similar success in FDM outlets with only one brand,
Redhook, showing negative numbers.
Mexican imports Corona Extra and Corona Light hold the
No. 1 and No. 3 spots on the Top 10 list of imports, respectively. This
fall, the brand, which had previously been handled by Gambrinus Co., San
Antonio, Texas, moved under the control of Crown Imports. The Chicago-based
company now handles national distribution for the popular import brands.
Heineken Premium Light was a stand out success in the
import category. In its first year on the market, Heineken Premium Light
reported 531 percent growth. The brand expands on the success of regular
Heineken, which occupies the No. 2 spot on IRI’s Top 10 import
brands.
Craft beers were up almost 12 percent overall in 2006,
according to the Brewers Association, based in Boulder, Colo. The industry
produced more than 6.6 million barrels of beer last year. Sierra
Nevada Pale Ale, from Sierra Nevada Brewing Co., Chico, Calif., is the top
seller through measured retail channels, and enjoyed dollar sales gains of
6 percent in FDM outlets. Boston Beer, maker of Samuel Adams Boston Lager,
is the largest of the craft brewers, and its flagship product also pulled
in large increases during the past year, with nearly 12 percent in FDM
outlets.
For the next year, an
upcoming trend predicted by Euromonitor’s Anne Nugent is flavored
beers. Michelob released its Ultra Fruit Infused Beers last month. Miller
rolled out its Chill nationally, taken from Mexican chelada-style beers
that mix beer with lime and salt. Several seasonal options combined fruit
flavors and beer, such as Leinenkugel’s Summer Shandy.
Rise of ‘cocktail culture’ lifts
spirits
The chic and sophisticated
pull of a “cocktail culture” raised sales in the spirits
category. Both flavored spirits and premium brands have experienced a boost
in popularity due to consumers, especially the newly legal crowd’s
desire for specially crafted drinks. From an energy drink-vodka mix to Grey
Goose martini, consumers of all legal drinking ages are turning to spirits,
which led to a 2.8 percent retail sales growth experienced by the spirits
category, IRI data states.
One category benefiting from the attenti