Healthy, Natural Claims Driving Soft Drink Growth

DUIVEN, The NetherlandsConsumers desire for natural and healthy products is helping drive the global soft drink market that is accelerating with rising levels of launch activity over the past two years, according to Innova Market Insights.

More than 58% of the soft drinks launches in the 12 months ending June 2012 had a health positioning of some kind, with over 50% using passive health claims and 18% active health claims, indicating that a number may use both types of claim together.

The most popular health-related claims recorded were undoubtedly concerned with naturalness and freedom from artificial additives and preservatives, and encompassed a wide range of products, led by water and juices that tend to be seen as inherently fairly natural, or can be relatively easily formulated to use this type of claim. More than 23% of launches were marketed as free from additives and preservatives, while nearly 13% used natural claims. Combining the two categories resulted in more than 30% of total soft drinks launches using either one or both claims. If organic claims, used for over 5% of launches, are added, the total rises to 35% using one or more of the three claims.

Fruit juices and drinks dominated launch activity with more than 43% of the total, reflecting the extremely diverse range of products included in the category. Carbonates took second place with 14%, just ahead of concentrates and mixes, then iced tea and coffee drinks, sports and energy drinks, plain and flavored water and sports and energy drinks.

Over the past five years, the shares of carbonates, juices and juice drinks, concentrates and mixes and iced tea and coffee have risen, while the shares of bottled water (flavored and unflavored) and sports and energy drinks have fallen.

Lu Ann Williams, director of innovation at Innova Market Insights, said a declining share of launch activity does not necessarily indicate a poor market performance overall.

Sports and energy drinks remain one of the fastest-growing sectors of the market over that period, despite their share of global soft drinks launch activity falling from a peak of 13% in 2005 to just under 7% today. Consolidation in the increasingly mature market, particularly the greater dominance of multinational brands and the disappearance of many smaller brands is probably the main reason for slowing activity rates, although actual launch numbers did still rise over the 5-year period," she said.