Long dominated by a handful of major brands, the U.S. beverage market is being transformed by niche drinks that target specific consumer needs, occasions and benefits, according to recent research by Packaged Facts.
According to "Beverage Trends: Culinary Trend Mapping Report" recently released by the Center for Culinary Development (San Francisco) and Packaged Facts (Rockville, Md.), two forces are spurring sales in the beverage market: Better-for-you trends (the number-one driver in the new beverage landscape, including functional, nutrition boosting, and holistic-wellness drinks) and consumers' quest for quality, including organic, local, artisan-made, and retro/nostalgic beverages.
The potential for new beverages targeting these trends is significant, with diverse consumers, from Gen Y teens to Gen X parents and sporty Boomers, looking for new healthful and premium new drinks, the report concluded.
“Because of this diversity in consumer demographics and psychographics,” emphasizes Kimberly Egan, CEO of the Center for Culinary Development, “the beverage market is an arena with plenty of room for growth and innovation.”
But what does this mean for c-store operators, who often rely on the major soda companies and their bottlers to shape their cooler planograms? The major cola companies are slowly reshaping their product mixes along consumer trends, but their track record with alternative beverages is littered with failures.
It will be interesting to see how retailers balance limited space and attractive incentives with the potential of new, not-yet-mainstream, niche beverages that carry more risk, but also higher margins, and which may be more desirable to customers who are shunning sodas and have concerns about the ingredients in energy drinks.
-- Barbara Grondin Francella
Comments