CARBONATED SOFT DRINKS - US - APRIL 2018

CARBONATED SOFT DRINKS - US - APRIL 2018

  • Mintel
  • April 2018
  • Soft Drinks
  • 0 pages

Report Description

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The mature $36.2 billion CSD (carbonated soft drink) market faces competition from RTD (ready to drink) coffees, energy drinks, sparkling waters, and BFY (better-for-you) options. Growth opportunities lie in targeting the occasions when CSDs offer unique benefits and focusing on functional and aspirational qualities that set these apart from other drinks. Focusing on key demographics such as 18-34 year olds and parents will also be essential, as will developing new products such as craft/premium CSDs with natural sweeteners, new flavors, and functional benefits.

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Table of contents
OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
On-going challenges limit growth in $36.2 billion CSD market
Figure 1: Total US sales and fan chart forecast of carbonated soft drinks, at current prices, 2012-22
The issues
Diet soda faces on-going challenges and continues to lose share
Figure 2: Total US retail sales of carbonated soft drinks, by segment, at current prices, 2015 and 2017
Still beverages are go-to drinks for most everyday occasions
Figure 3: Occasion for beverage consumption, February 2018
The opportunities
High market penetration and engagement of 18-34 year olds and parents
Figure 4: Carbonated soft drinks consumed in past three months, for those 18-34 and parents, February 2018
CSD usage climbs on weekends, for celebrations, and for treats
Figure 5: Occasion for beverage consumption, February 2018
Ideal CSD is foremost “refreshing,” but also associated with aspirational qualities
Figure 6: Qualities of ideal CSD, February 2018
Quest for new tastes and interest in craft CSDs from big brands
Figure 7: Attitudes toward flavors and craft sodas, for 18-34 year olds and parents, February 2018
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Little growth in mature, crowded CSD market
Regular carbonated soft drinks are the larger, more stable segment
Obesity and taxes hurt CSD sales, while economic factors lift them
MARKET SIZE AND FORECAST
Growth dips in 2017 and forecast shows little growth through 2022
Figure 8: Total US sales and fan chart forecast of carbonated soft drinks, at current prices, 2012-22
Figure 9: Total US retail sales and forecast of carbonated soft drinks, at current prices, 2012-22
MARKET BREAKDOWN
Regular soft drinks the larger, faster-growing segment
Figure 10: Market share of carbonated soft drinks, 2017
Figure 11: Total US retail sales of carbonated soft drinks, by segment, at current prices, 2015 and 2017
Sales down for diet CSDs, while regular CSDs hold ground
Figure 12: Total US retail sales and forecast of carbonated soft drinks by segment, at current prices, 2012-22
“Other” retailers account for almost half of retail sales
Figure 13: Total US retail sales of carbonated soft drinks, by channel, at current prices, 2015 and 2017
MARKET PERSPECTIVE
Bottled water sales climb, reflecting consumer quest for BFY drinks
Figure 14: Total US retail sales and forecast of bottled water, at current prices, 2012-22
Coffee and tea – including new cold RTD brew – compete with soda
Energy drinks continue to climb and are popular with males 18-34
Juice drinks offer natural alternatives to CSDs
Hybrid drinks offer competition, but also potential opportunity
At-home carbonation offers low-cost, eco-friendly alternative
Figure 15: Sodastream infomercial, November 2017
MARKET FACTORS
Obesity concerns leading consumers away from CSDs
Sin taxes raise health issues and increase prices on CSDs
Disposable income and consumer confidence can shape CSD spending
Figure 16: Consumer confidence and unemployment, 2000-February 2018
Younger consumers, including 18-34 year olds, are increasingly diverse
Figure 17: US population aged 18+, by age, 2013-23
Figure 18: Population by race and Hispanic origin, 2013-23
Figure 19: Distribution of population, by age, race and Hispanic origin, 2018
KEY PLAYERS – WHAT YOU NEED TO KNOW
Two of the three largest CSD suppliers saw MULO sales grow in 2017
Coca-Cola and Dr Pepper/Snapple promote core brands, revamp others
Private label sales fall, while “other” suppliers innovate and build share
BRAND SALES OF CARBONATED SOFT DRINKS
Coca-Cola and Dr Pepper/Snapple build share
Pepsi continues to struggle, but rolls out new ad campaign in 2018
Private label sales fall, as retailers shift focus to bottled water
Niche suppliers do well as “others” grow sales from a small base
Figure 20: Multi -outlet sales of carbonated soft drinks, by leading companies, rolling 52 weeks 2016 and 2017
WHAT’S WORKING?
Multi-platform marketing suggests there’s a Coke for everyone
Figure 21: Coke Super Bowl ad, “The Wonder of Us,” February 2018
Connecting communities through celebration
Figure 22: Coca-Cola “Food Feuds,” February 2018
Dr Pepper/Snapple grows share with Dr Pepper, Canada Dry
Figure 23: Dr Pepper, “Lil Sweet in a Cake,” February 2018
Figure 24: Canada Dry, “Busy is a 4-Letter Word,” August 2017
WHAT’S STRUGGLING?
Diet sodas continue to struggle, although sales stagnate rather than fall
Pepsi Cola loses market share, but launches major campaign in 2018
Figure 25: Pepsi “Generations,” February 2018
Figure 26: Pepsi, “Paint the world blue,” March 2018
WHAT’S NEXT?
Potential reinvigoration of diet soda category, as Coke gets proactive
Figure 27: Diet Coke, “Like What You Like/Because I Can,” February 2018
Figure 28: Diet Coke, “Twisted Mango,” February 2018
Rebranding of Coca-Cola Zero with refreshed look and new taste
Figure 29: Coca-Cola Zero Sugar, January 2018
Expanded craft/premium CSDs from major suppliers
Health and digestive benefits in ginger ale and other natural craft sodas
Natural craft CSDs with floral essences, botanicals, sophisticated tastes
THE CONSUMER – WHAT YOU NEED TO KNOW
Consumption is high, especially among younger adults and parents
CSDs widely used on weekends, special occasions and as treats
“Refreshing” is top quality sought in CSDs, but many others follow
Dedicated regular CSD and diet CSD users have distinct profiles
Brand allegiance is fairly strong, but lower among younger consumers
Consumers favor sweeteners with a more natural profile
Majority seek familiar tastes, but interest fairly high for craft CSDs
CONSUMPTION OF CARBONATED DRINKS
Vast majority enjoy a range of CSDs
Figure 30: Carbonated drinks consumed in past three months, February 2018
Younger consumers enjoy more regular CSDs, older ones turn to diet
Figure 31: Carbonated soft drinks consumed in past three months, by age, February 2018
Younger adults also over index for other carbonated drinks
Figure 32: Non-CSD carbonated drinks consumed in past three months, by age, February 2018
More affluent HHs show preference for low calorie, natural CSDs
Figure 33: Carbonated soft drinks consumed in past three months, by household income, February 2018
Figure 34: Non-CSD carbonated drinks consumed in past three months, by household income, February 2018
Parents consume a greater number, wider range of CSDs
Figure 35: Consumption of regular cola and other soft drinks, for children aged 6-11
Figure 36: Consumption of regular cola and other soft drinks, for teens aged 12-17
Figure 37: Carbonated soft drinks consumed in past three months, by parental status, February 2018
Figure 38: Non-CSD carbonated drinks consumed in past three months, by parental status, February 2018
Black consumers drink more regular CSDs, White consumers seek low-sugar options
Figure 39: Carbonated soft drinks consumed in past three months, by race, February 2018
Figure 40: Non-CSD carbonated drinks consumed in past three months, by race, February 2018
Hispanics over index for natural and craft sodas
Figure 41: Carbonated soft drinks consumed in past three months, by Hispanic origin, February 2018
CONSUMPTION OCCASIONS
CSD usage climbs on weekends, at celebrations, and as treats
Figure 42: Occasion for beverage consumption, Part I, February 2018
Figure 43: Occasion for beverage consumption, Part II, February 2018
18-34 year olds embrace regular and craft CSDs for special occasions
Figure 44: Occasion for CSD consumption, by age, February 2018
Less affluent consumers favor regular and craft CSDs for celebrations and treats
Figure 45: Occasion for CSD consumption, by household income, February 2018
Parents post high usage of CSDs for special occasions
Figure 46: Occasion for CSD consumption, by parental status, February 2018
QUALITIES SOUGHT IN IDEAL CSD
Ideal CSD is above all “refreshing,” and more
Figure 47: Qualities of ideal CSD, February 2018
Refreshment is key quality across age brackets
Figure 48: Qualities of ideal CSD, by age, February 2018
Less affluent consumers associate CSDs with more aspirational qualities
Figure 49: Qualities of ideal CSD, by household income, February 2018
Refreshment key for nonparents, parents seek energy and indulgence
Figure 50: Qualities of ideal CSD, by parental status, February 2018
Black consumers desire a range of positive qualities
Figure 51: Qualities of ideal CSD, by race, February 2018
CSD PREFERENCES IN TERMS OF TYPE AND BRAND
Dedicated regular CSD users index somewhat younger and less affluent
Figure 52: Mostly drink regular CSDs, by age, gender, HH income, February 2018
Staunch diet CSD users tend to be older, female, and more affluent
Figure 53: Mostly drink diet CSDs, by age, gender, HH income, February 2018
Older consumers less likely to switch types or look at type of sweetener
Figure 54: CSD preferences, by age, February 2018
Women trade less between CSD types, pay more attention to sweeteners
Figure 55: CSD preferences, by gender, February 2018
About half of consumers report brand allegiance
Figure 56: CSD preferences related to brand, by age and household income, February 2018
TYPES OF SWEETENERS IN CSDS
Consumers favor sweeteners with a more natural profile
Figure 57: Types of sweeteners preferred, February 2018
Consumer age impacts sweetener preference
Figure 58: Most appealing sweetener in CSDs, by age, February 2018
More natural sweetener options favored by both men and women
Figure 59: Most appealing sweetener in CSDs, by gender, February 2018
Stevia stands out as a preferred sweetener of more affluent consumers
Figure 60: Most appealing sweetener in CSDs, by household income February 2018
ATTITUDES TOWARD FLAVORS, CRAFT SODAS, AND TAXES
Majority seek familiar tastes, but interest fairly high in new craft CSDs
Figure 61: Attitudes toward flavors, craft sodas, and sugar taxes, February 2018
Younger consumers more open to new flavors and craft/premium CSDs
Figure 62: Attitudes toward flavors, craft sodas, and sugar taxes, by age, February 2018
Parents open to new CSDs, but may cut back more if faced with tax
Figure 63: Attitudes toward flavors, craft sodas and sugar taxes, by parental status, February 2018
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
APPENDIX – MARKET
Figure 64: Total US retail sales and forecast of carbonated soft drinks, at inflation-adjusted prices, 2012-22
Figure 65: Total US sales and forecast of regular soft drinks, at inflation-adjusted prices, 2012-22
Figure 66: Total US sales and forecast of diet soft drinks, at inflation-adjusted prices, 2012-22
Figure 67: Total US retail sales of carbonated soft drinks, by retail channel, at current prices, 2012-17
APPENDIX – KEY PLAYERS
Figure 68: MULO sales of regular soft drinks by leading companies and brands, rolling 52 weeks 2016 and 2017
Figure 69: MULO sales of diet soft drinks by leading companies and brands, rolling 52 weeks 2016 and 2017
APPENDIX – CONSUMER
Figure 70: Number of glasses of regular cola soft drinks in the past week, for children 6-11
Figure 71: Number of glasses non-cola soft drinks in the past week, for children 6-11
Figure 72: Number of glasses of regular cola soft drinks in the past week, for teens 12-17
Figure 73: Number of glasses of other regular soft drinks in the past week, for teens 12-17
Figure 74: Number of glasses of diet cola soft drinks in the past week, for teens 12-17
Figure 75: Number of glasses of regular cola soft drinks in the past week, for teens 12-17

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