Consumers’ Hot and Soft Drink Preferences: New Trends & Future Perspectives

NEW YORK–(BUSINESS WIRE)– announces that a new market research report related to the Soft Drinks industry is available in its catalogue.


Consumers’ Hot And Soft Drink Preferences: New Trends & Future Perspectives


Consumer’s consumption of hot and soft drinks is increasing year-on-year, mainly to fulfill hydration and health demands, and partly to satisfy indulgence needs. This report identifies what is driving consumers soft and hot drink occasions and assesses which drinks categories are winning share of throat. Marketers must understand key consumer drivers to grow occasions and maintain market share.

Detailed occasion and consumption data covering bottled water, carbonated beverages, juices, functional drinks, coffee, tea and other hot drinks. Insight in to consumers changing share of throat preferences and the trends driving beverage choice through 2011. Showcases the latest best-practice product and marketing innovation highlighting how to capitalize on consumer’s unmet needs. Strategic conclusions and actions highlighting how manufacturers and retailers should direct resources towards evolving drink trends.

Consumers are creating new drink occasions in an effort to satisfy conflicting need states, with health a key driver of future soft and hot drink occasions. European and US consumers had on average 1,186 soft drink occasions in 2006 and this is forecast to rise to 1,331 by 2011, a growth of 2.3%

Drinks categories are becoming increasingly blurred as consumers’ share of throat evolves, and drinks manufacturers are facing increasing competition both from rival brands and more importantly from different drinks categories.

Hot drink preferences are changing with tea becoming increasingly popular in coffee dominated markets such as the US, France and the Netherlands, due to its perception amongst consumers of being healthy. In contrast, coffee occasions are becoming increasingly indulgent with strong growth in specialty coffee through foodservice channels.

Gain a detailed understanding of the drivers and inhibitors associated with consumers soft and hot drink choices. Update your strategic marketing by determining how and why to target consumers better by focusing on key occasions and locations. Drive insight generation by using a compelling mix of quantitative and qualitative data illustrating consumer preferences and market developments.

Overview 1

Catalyst 1

Summary 1

Table of Contents 2

Table of figures 3

Table of tables 4



This report covers bottled water, carbonates, functional drinks, juices, tea, coffee and other hot drinks 5

TREND: New beverage occasions are emerging as consumers look to satisfy conflicting need states 6

Per capita frequency of soft drink occasions is higher in the US than Europe 7

German consumers’ drinks choices are driven by the health trend 8

Increasing temperatures are set to drive soft drink occasion frequencies, especially in the summer months 9

The growing number of non-alcoholic drinkers in some countries is driving growth in soft drink alternatives 9

Moderated consumption of alcohol is even being seen among students 10

Aging populations are shaping the soft drinks industry 11

Carbonated drink occasions are evolving to different day parts 12

Children are drinking less carbonated drinks 12

Hot drink consumption in Western markets is heavily dependent on culture and climate 12

Coffee is becoming an indulgent drink 13

Hot drink consumption increases in colder climates 14

Key take-outs and implications: consumers are choosing beverages that best fit their needs and are willing to forego previous beverage format preferences 16

TREND: Healthier drinks are gaining ‘share of consumer’s throat’ 17

Consumers are increasingly opting for ‘better-for-you’ and ‘good-for-you’ beverages 17

There are marked differences between European and US soft drink share of throat 18

Consumers’ propensity to drink tea is growing in the US, while European consumers are drinking more coffee 19

Consumers’ growing propensity to drink tea in the US is being driven by its positive health associations 20

Key take-outs and implications: health is heavily influencing consumers’ hot and soft drink preferences, something which must be recognized in future NPD activity 20

TREND: The importance of instantaneous and constant hydration to consumers is growing 21

Consumers are increasingly appreciating the importance of staying hydrated 21

Women consider hydration to be more important than men 23

Older consumers find drinking water more important than younger consumers 23

Children are increasingly appreciating the importance of drinking enough water 23

Key take-outs and implications: in addition to health, indulgence and convenience needs, physical hydration needs have intensified in recent years 24

INSIGHT: Bottled water occasions are increasing, taking an increasing ‘share of throat’ 24

Bottled water now accounts for half of all soft drink consumption in Europe 25

There is a correlation between the type of ice or water that consumers prefer to consume at home, and the size of the bottled water market in those countries 26

There is concern over the nutritional content of flavored water, which may inhibit future growth 26

Concerns over the environment may encourage greater tap water consumption in the future 27

Key take-outs and implications: bottled water growth has been extremely strong, although there are barriers facing the category in the future 27

INSIGHT: The carbonates market is showing little growth as consumers switch to healthier beverages 28

Consumers in Europe have under half the number of carbonated drink occasions as the US 29

Growth in the carbonates market is being driven by diet variants 29

Key take-outs and implications: consumers are switching from carbonated beverages, as it is a category that is generally ‘off-trend’ 30

INSIGHT: Juices growth is being driven by the health and indulgence trends 30

The number of juice occasions is increasing as consumers look to increase their consumption of fresh items and ‘good-for-you’ nutrients 31

Consumers believe that juices are a convenient way of providing part of their five-a-day requirement 32

Consumers feel confused by juice labeling 32

Key take-outs and implications: as health becomes more important to consumers, the juices market is well placed to benefit 32

INSIGHT: Functional drink occasions are growing as consumers take a preventative and convenience driven approach to consumption 33

Europeans account for just a third of the total functional drink occasions accounted for by US consumers 33

Men are core functional drink consumers but female consumption is increasing 34

Aging populations are also changing the profile of the functional beverage consumer 34

Key take-outs and implications: consumers are slowly embracing the healthy science behind functional beverages 35

INSIGHT: Coffee is overwhelmingly the hot drink preference among Europeans and Americans 36

The number of coffee occasions is increasing 36

Tea is gaining share of throat at the expense of coffee in the US 37

Tea is capitalizing on the health trend 38

Other hot drinks represent a small but growing part of overall hot drink occasions 39

Key take-outs and implications: coffee continues to attract consumers requiring a pick-me-up and indulgence 40



ACTION: Recognize and react to consumers shifting ‘share of throat’ dynamics 42

Target alternative beverage occasions by making beverages more versatile 44

Target the student demographic with greater intensity to capitalize on their desire for sophisticated alternatives to alcoholic beverages 44

Develop multiple packaging sizes to capture new occasions 45

ACTION: Inflate the premium credentials of beverage products and services 45

Promote freshness as a core product attribute 46

Develop natural or organic products that facilitate premium pricing 47

Consider glass packaged beverages to capitalize on the demand for superior sensory satisfaction 48

ACTION: Develop and promote healthier coffee at specific occasions 48

Challenge the perception that coffee is unhealthy 49

Explore the possibilities of promoting coffee’s antioxidant benefits to help fight back against teas 49

Consider developing milder strength coffee to target health conscious consumers 51

Appeal to consumers seeking functional drinks by developing energized coffee, especially by infusing existing variants with natural ingredients 52

ACTION: Emphasize the benefits that bottled water offers over tap water 53

Emphasize the origin of bottled waters to differentiate from tap water 53

Offer a value proposition to attract lower income consumers 54

Add additional nutrients to bottled water to compete with functional beverages 55

Lower sugar levels in flavored waters to combat cynicism 55

Develop recyclable packaging to counter wastage concerns 56

ACTION: Focus juice marketing efforts on both healthy and indulgent occasions 57

Promote five a day in promotional literature 57

Target parents and children with good-for-you juice brands 58

Consider altering juice formulations 58

Target different day-parts 59

Juice marketers should ensure that the origin of their products is clearly marketed 60

ACTION: Encourage everyday tea consumption 60

Promote tea as a self indulgent treat 61

ACTION: Challenge perceptions that carbonated drinks are unhealthy 62

Consider added functionality in carbonated drinks to counter the functional drink threat 63

Replace artificial flavors and additives with natural ingredients 64

Target different day-parts 64

Carbonated drinks are increasingly being consumed at breakfast time in the US 64

Consider positioning carbonated drinks as an ‘indulgent treat’ 65

ACTION: Target specific consumer groups with functional beverage occasions 66

Target specific health concerns with functional beverages 67

Communicate the ease that your products offer in maintaining a healthy diet 68

Ensure that attempts at gender specific functional drink positioning are targeted appropriately 68

Appendix 70

Definitions 70

Methodology 70

Further reading and references 71

Ask the analyst 71

Datamonitor consulting 72

Disclaimer 72

List of Tables

Table 1: Overall and per capita consumption of soft drinks (liters, million), Europe & US, by country, 2001-2011 7

Table 2: Overall and per capita soft drink occasions, Europe & US, by country, 2001-2011 (millions) 8

Table 3: European and US consumers abstaining from alcohol by country (percentage and overall, millions), by country, 2006 10

Table 4: Overall expenditure on soft drinks split by age group, Europe & US (% expenditure) 2003-2005 12

Table 5: US away from home vs at home sales of coffee products (US$m) 2001-2011 13

Table 6: Overall and per capita consumption of hot drinks (liters, millions), Europe & US, by country, 2001-2011 14

Table 7: Overall and per capita hot drink occasions, Europe & US, by country, 2001-2011 (millions) 15

Table 8: Extent to which consumers consider soft drinks healthy, (% respondents), US & Europe, 2007 18

Table 9: Hot drinks share of throat(%), by beverage format, Europe & US, 2001-2011 20

Table 10: Proportion of European consumers who drank more water over the past year, (ranking and % of respondents), 2006 22

Table 11: Proportion of European consumers who drank more water over the past year, (ranking and % of respondents split by gender), 2006 23

Table 12: Overall and per capita bottled water occasions (millions), Europe & US, by country, 2001-2011 25

Table 13: Consumer preferences for water type, Europe & US, 2006 (%) 26

Table 14: Overall and per capita carbonate occasions (millions), Europe & US, by country, 2001-2011 28

Table 15: Overall and per capita juices occasions (millions), Europe & US, by country, 2001-2011 31

Table 16: Expenditure on functional drinks, by age group, Europe & US (% overall expenditure) 2003-2005 35

Table 17: Overall and per capita coffee occasions (millions), Europe & US, by country, 2001-2011 37

Table 18: Overall and per capita tea occasions (millions), Europe & US, by country, 2001-2011 38

Table 19: Overall and per capita other hot drink occasions, Europe & US, 2001-2011 (liters, million) 40

Table 20: Definition of terms 70

List of Figures

Figure 1: Packaged coffee sales in the US increase as temperatures decline 16

Figure 2: Soft drinks share of throat (%), by beverage format, Europe & US, 2001-2011 19

Figure 3: Consumers across Europe and the US increasingly consider drinking water an important factor in maintaining a healthy diet 22

Figure 4: Diet Cola will account for over 45% of total cola sales in the US by 2011 29

Figure 5: Coca Cola Zero has achieved global success by tapping into the values and beliefs of global males and giving them their own Coke 30

Figure 6: Consumers in the US are forecast to have 114 functional drinks per person per year by 2011 34

Figure 7: Soft and hot drinks share of throat by age, Europe & US, 2005 (% expenditure) – this shows how functional drink expenditure is dominated by younger consumers 43

Figure 8: The on-trade offers beverage marketers opportunity to target new soft drink occasions 44

Figure 9: Consider setting up juice bars to capture soft drink occasions away from alcohol 45

Figure 10: Ensure that you have packaging sizes to cater for different types of occasion needs 45

Figure 11: Innocent Drinks has achieved considerable success by marketing healthy products in an engaging and fun manner 47

Figure 12: Develop natural or organic products to generate premium pricing 48

Figure 13: Focus marketing on antioxidant levels in your coffee to gain consumer share of throat 50

Figure 14: Tea manufacturers have long emphasized the healthy properties of their products 51

Figure 15: Folgers Simply Smooth Coffee provides consumers with a milder strength coffee to cater for those consumers who find coffee too acidy 52

Figure 16: Appeal to consumers seeking functional drinks by developing energy coffee 53

Figure 17: Emphasize the origin of bottled waters to differentiate from tap 54

Figure 18: Develop enhanced waters to capture share of throat from functional drinks 55

Figure 19: Lower sugar levels in flavored waters to combat cynicism 56

Figure 20: Target fruit and vegetable juices to parents and children 58

Figure 21: Industry players need to alter juice formulations with ‘good-for-you’ and ‘better-for-you’ content 59

Figure 22: Encouraging ‘everyday consumption’ in a broad range of occasion scenarios is an effective way of boosting the versatility of beverage formats and maximizing market potential 61

Figure 23: Manufacturers must avoid category myopia and recognize that a broader range of product formats are now offering similar benefits 63

Figure 24: Consider added functionality in carbonated drinks to counter the functional drink threat 64

Figure 25: Targeting the breakfast occasion could provide a welcome boost to carbonate consumption 65

Figure 26: Consider positioning carbonates as an indulgent treat to capitalize on the desire for ‘me-time’ 66

Figure 27: Target specific consumer groups with functional beverage occasions 67

Figure 28: Embracing functional beverages allows industry players to target specific health concerns 68

Companies involved in the industry :

The Coca-Cola Company, PepsiCo Inc., Cott Corporation, Cadbury Schweppes plc, Dr Pepper/Seven Up , Inc., Britvic, Cadbury Schweppes Americas Beverages, Coca-Cola Enterprises Inc., National Beverage Corp., The Pepsi Bottling Group , Inc., PepsiAmericas Inc, Red Bull GmbH, Coke, Hansen Natural Corporation, Lancer Corporation, Kraft Foods Inc., A.G. Barr p.l.c., Orangina, American Beverage Corporation, Coca-Cola Amatil, S. M. Jaleel & Co, 7UP, Carolina Beverage Corp., Jarritos, Canada Dry Bottling Company, Blue Ridge Beverage Company , Inc., Kirin Brewery Co. , Ltd., Diageo plc, Refresco Holding B.V, Efes Beverage Group, Sangs Ltd, Shasta Beverages , Inc., Pepsi Russia, Jones Soda Co., British Soft Drinks Association, Amalgamated Beverage Industries Limited, Mrs. Fields Famous Brands , LLC, Princes Soft Drinks Group, Orchid Drinks Limited, Radnor Hills Ltd, Sonut, Kofola, ABC News, Safeway Inc., Compania Cervecerias Unidas S.A., P&E Distributing Company, Hellena, Scotsman Ice Systems, Wis-Pak Inc., Vitanta, McDonald`s Corporation, Qibla Cola Company Ltd, Sunglint, AmBev, CALCOL INC., Bottle Green Drinks Co, Nichols plc, Aquabar, Ensemble Beverage Co., Canadian Broadcasting Corporation, AUJAN Industries Co. , L.L.C, Burger King Corporation, FEMSA, Unibev Ltd, Mellow Moon, Ale-8-One Bottling Company Inc, Mecca-Cola, Snapple, Suntory Limited, Icy Splash Food & Beverage Inc, Pepsi MidAmerica, John Barritt & Son Ltd, Alpine Beverages, Slades Beverages Pty Ltd, Heineken N.V., Buffalo Rock Company, Fuze Beverage , LLC, Hey-Song Corporation, United Wine Merchants Limited, R&T Beverages Inc., Ball Corporation, Central European Distribution Corporation, Dixie-Narco Inc, Merrydown plc, Agros Nova, Galada Agro Industries, Cervecería Nacional S.A., Sumolis S.A., Alcoa Inc., Triarc Companies Inc, WAYSO, Columbia Beverage Company, The Feel Good Drinks Company, Ochakovo, VSD Logistics Nordic, PBG Fiance, Vrumona, Lemon-Lite, Krones AG, National Soft Drink Association, Cafédirect plc, Fairtrade Vending, Level-Ground , LLC,, Drinkmaster Ltd, Conference Cup Ltd., Ron & Frank`s, Basics Products Inc, Cuda Coffee Company , Inc., Cuda Coffee Vending Inc, Mamma Roma Ltd, Refreshment Systems Ltd, Eagle Vending Services Ltd, Coinadrink Limited, Allied Drink Systems Ltd, SPRINGBANK INDUSTRIES LIMITED, Kampery Development Limited, The Alba Beverages Company, Cafe Vending

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