If energy drinks are the brash new kids on the soft drinks block then squashes and cordials are the category’s thrifty but dependable aunts and uncles.


of people say that their main reason for visiting convenience stores is to purchase soft drinks.

Source: Nielsen

Once associated in the consumer consciousness with long, hazy childhood summers, today they’re drunk by an impressive 64% of adults, according to Mintel - mainly parents with kids in tow.

Princes category manager Graham Breed says that their appeal is largely down to dilutable’s family-friendly, value-for-money positioning. “Sales of squash are experiencing strong value growth as consumers look to it as a cost-effective way to keep their family hydrated throughout the week,” says Breed.

“As shoppers continue to cut back on their household spend over the next 12 months, we expect sales of squash to benefit.”

Over the past year Mintel says that the biggest news has been in double-strength products. According to its figures, NPD involving double-strength variants quadrupled in a single year.

Breed says this move has definitely affected market volume sales (since longer-lasting drinks mean fewer purchases) and that single strength is still the biggest-seller in convenience.

“Many consumers still prefer to have control over dilution,” he says. “This is especially true when purchasing for children who make their own drinks, but who may struggle with the concept of double strength.”

Brands have been busy underlining the more-for-less philosophy behind these products with other price initiatives, such as pricemarked packs (PMPs).

Retailer’s view

“Soft drinks is a very important category. It’s got a big cash margin and is big in the impulse channel - so it’s a line where everybody can do very well.

“In the past few years we’ve definitely seen a shift towards ‘healthier’ drinks such as waters, juices and smoothies. This has also meant a move away from colas and sweet fizz - although they’re important overall to the category, too.

“Juices and smoothies can be expensive, but it’s a category where the consumer can spend as much or as little as they like - especially since the prevalence of own brand. The challenge is to get the right mix in terms of appeal and cash margin. You’ve got to make maximum use of the space you have. If you haven’t got much space then stick with the value drivers and best-sellers.

“Larger stores can make choices according to their customers - and with all the different variants around the main brands, the mix of products is almost too vast to choose from.”

Guy Warner, Warner’s Budgens

“Interestingly, as a brand we’ve seen the PMP part of our sales jump quite considerably,” says Vimto brand manager Clare Pritchard.

She says that the PMP proportion of their sales rose from 33% in 2011 to 45% in 2012. It’s been a key element of the brand’s growth, coupled with the success of its no-added sugar variant, which has grown 30% in two years.

However, it’s not all value for money austerity in the squash category. Nigel Paine from Britvic, home of the market-leading Robinsons brand, is keen to remind retailers that squash consumers are looking for a bit of excitement, too.

“We’re underlining that again this year with our support for Wimbledon,” he says.

There’s also evidence that, with the kids already covered by reassuringly wholesome family favourites, adults looking to cut back on alcohol are growing the market by choosing sophisticated cordials.

“The total dilutables category is worth £37.6m a year to impulse retailers,” explains Bottlegreen Drinks managing director Simon Speers. “Although cordials currently account for just over £750,000 of these sales, this is where the growth is actually coming from - so it’s a sector impulse retailers can’t afford to ignore.”

Bottlegreen’s range of cordials is a very adult affair, with variants such as elderflower and ginger & lemongrass, plus seasonal limited-edition flavours to add excitement.

Fruit focused

It is said that the figure of five-a-day fruit and veg consumption was set by the government because it was the minimum amount that could possibly constitute a healthy diet while being the maximum amount they could persuade the average British consumer to eat - which might explain why consumers are so keen to choose juices as an easy and enjoyable way to meet their quota.

But not everyone is keen on this type of product. According to Jon Evans, marketing manager at Purity, the perception of high-priced products, plus the need for a chilled distribution network, can be off-putting for retailers and consumers alike.

“Most of the brands in the sector are both expensive and need a chilled supply chain,” he says.

“With our JuiceBurst brand we can offer consumers very high-quality juices, but with a seven-month shelf life. They fit with the profile of a healthy on-the-go drink, but are more affordable than some of the other products.”

Ambient formats are also a way for retailers to offer high-fruit products that customers can afford everyday.

“Consumers are recognising that ambient formats are a cost-effective way to buy juice without compromising on quality,” says Princes’ Graham Breed.

“The added convenience of a long shelf life also appeals to families and people who prefer to take advantage of multipack offers, so is driving value into the market.”

He adds: “Our ‘nothing added’ campaign communicates the longer shelf life of ambient juices, freeing up that elusive fridge space for families, and aims to dispel the myth that the long-life benefits of ambient juice are down to added preservatives.”

While colas and other sugary categories continue to attract attack by campaigners who claim they’re too calorific, water has emerged as one of the more ‘virtuous’ drink options on offer. And, luckily for the big brands, today’s thirsty shoppers don’t need to be sold on the various health benefits.

“British consumers largely understand the benefits of drinking water, whether it comes from a tap or a bottle,” says Christina Medford, Danone Waters UK head of category development.

“A Danone Waters-commissioned study found that 43% of the UK population consume exclusively bottled water when they are out of their home and on the go. In fact, 54% of participants in the study stated hydration on the go was their main motivation for buying bottled water.”

“In 2013, we expect to see still waters continue to hold the lion’s share of the category,” adds Claire Wilson, marketing and sponsorship manager at Highland Spring. “If recent trends are anything to go by, sparkling waters will also benefit.

“Sparkling bottled water has been performing very well, driven in part by consumers using sparkling water to mix with squashes and cordials as a good value alternative to more expensive drinks when entertaining at home.”

The experts agree the most exciting innovation in the category has come from flavoured water. Medford says that half of the value growth in bottled water has been driven by the flavoured and juicy water segment, which is growing 9.6% in value year on year.

To capture this burgeoning market for summer, Volvic has released a new Citrus Burst variant for its Volvic Juiced brand.

Although traditional orange and apple juice continues to score well with children, today’s consumers have a taste for something more exotic, as illustrated by the success of the Rubicon brand.

“Rubicon is a very exciting brand for us which has grown 7% in the past year,” says Adrian Troy, head of marketing at AG Barr.

“It continues to be very popular with British Asian and black communities and it’s grown into the mainstream market as people seek out more exciting tastes.”

Meanwhile, health-giving ‘super-fruits’ are fortifying the exotic trend in brands such as Sunmagic, which is offering new passionfruit, mango, pineapple & coconut and pomegranate variants for summer 2013.

“Mangoes are renowned for their protective nutrients, while passionfruit is also high in potassium and anti-oxidants,” says Sunmagic brand manager Razin Ali.

“The popularity of pomegranates has risen sharply over the past couple of years, with many referring to the tropical fruit as a super-fruit, thanks to it being a fantastic natural source of vitamins including folic acid.”

Meanwhile, when it comes to making the most of the category, retailers will be up against a big challenge for summer 2013: there’s no Olympic Games to boost sales or to provide a focus for merchandising.

“With no big sporting events going on this year, retailers are going to have to get creative,” says Pritchard.

“One idea is to get really savvy with cross-merchandising - for instance, mixing soft drinks with snacks to provide everything customers need for a big night in.”

Britvic’s Paine says that extending traditional meal deals into other eating occasions can be a winner for retailers who want to get their promotions right. “More and more we’re seeing that the meal deal is moving to other times of day - so you’re getting ‘drink and a snack solutions’,” he says. “We’ve found that two-thirds of soft drinks are consumed with a snack - but only 13% are sold together. So there’s definitely an opportunity there.”

Of course, a bit of sun is the real x-factor that gets soft drinks sales moving during the summer months. But Paine is adamant that even if the sun fails to come out to play, the category will still be a solid seller, even in the rain.

“Last year we had a very poor summer and really low consumer confidence, but soft drinks tended to be resilient,” he says. “I believe that this time round we’re in a good place to build growth.”

Ones to watch

Health club

Juice fans put off by the calorie count of some brands are the target market for Trop50, which contains half the calories and sugar found in regular juices. Trop50 comes in smooth orange and orange & mango, and is sweetened with stevia. It was big in the US and could chime with shoppers here.

rrp: £1.19

tel: 0118 930 6666

Not a soft option

Only one in three c-stores currently stocks Schloer - despite it being the brand-leading adult soft drink. If you want to make a start on the line-up, its limited-edition raspberry & rhubarb punch could be good news to attract shoppers seeking sophisticated booze-free indulgence.

rrp: £2.25

tel: 01452 378500

Berry good

Customers still hankering for a taste of the exotic after their annual holiday away? Ribena’s ready-to-drink range is going all sun-drenched with new mango & lime and pineapple & passionfruit variants, available in special 99p PMPs, sure to attract some in-store heat.

rrp: 99p

tel: 0800 096 3666

On the pitch

Nestlé Waters is promising a packed schedule of activity for its brands in the coming year, including ongoing sponsorship of the England Cricket Captain Alastair Cook with Buxton. The brand will also lead a campaign focusing on cricket’s The Ashes in the summer. Perrier will also be launching NPD later this year.

tel: 0800 000 030

Water works

Mother Nature might have come up trumps when she created water, but it would’ve been even better if she’d added a bit of flavour to her handiwork. Now Volvic is finishing the job with Citrus Burst flavour Volvic Juiced, set to boost a sub-sector already growing 5% year on year.

rrp: £1.69

tel: 0800 975 6000