Pure juice remains the number two sub-category in the soft drinks market despite a 1% decline in 2008. The sub-category is now worth £1.2bn (£149m in the impulse sector).
Juice drinks also suffered a 1% decline last year and if it wasn't for kids' drinks such as Robinson's Fruit Shoot and Capri Sun, up 5% and 11% respectively, the sub-category could have seen a greater drop. Ribena had a tough 2008 with sales of its 250ml cartons dropping 13%. The juice drinks market is worth £480m, £169m of this from the impulse channel (source: Britvic Soft Drinks Report).
And after two years of being the fastest growing sector, things got rough for smoothies, with total sales dropping by 20% to £172m. Top seller Innocent was badly bruised, suffering a 26% decline in sales in 2008.
According to Paul Moody, chief executive of Britvic, the move away from smoothies is due to consumers not wanting to pay top price for their fruit fix. "Consumers have taken the 'five a day' message on board - but not at any price," says Moody. "Some smoothie buyers have switched to less expensive drinks in an effort to maintain their 'five a day' at a lower cost."
Calypso Soft Drinks has also noted the consumer drift towards more cost-efficient beverages. "Expensive items such as smoothies are suffering significantly in the recession, as consumers look for value for money and move towards ambient juices," claims sales and marketing director Richard Cooke. While total pure fruit juices are down 2.2% on sales, Calypso's pure juices are up nearly 4%. And the company is confident that it will continue to prosper as consumer purse strings tighten. "I forecast continued stability across value-for-money brands, especially juices, which have now become an everyday drink for many people," states Cooke. "People will continue to downgrade from premium labels to value for money brands."
It's not just consumer spending that has been affected by the economic situation, but also the actual channels they choose to shop in. "The economic downturn has impacted upon the way consumers shop, as more planned visits are taking place with supermarkets being the chosen destination," claims Murray Harris, sales director at Britvic.
While that view isn't great for convenience store retailers, all is not lost, according to Harris.
"There is a big opportunity for retailers to take advantage of consumers favouring dining in over going out as they tighten belts. The decision to host a night in is often made spontaneously as a result of sunny weather."
To benefit from these spontaneous occasions, Harris recommends that retailers have chilled juices and smoothies ready for the warm weather. "According to our research, 53% of shoppers are willing to pay more for chilled soft drinks and 84% of 'drink now' soft drinks are purchased from the chiller," he adds.
And it's not just evening dining that is sustaining the juice and smoothies market - lunch is a key time of day when it comes to these sub-categories and retailers are advised to stock accordingly.
"Lunch or on-the-go thirst quenching are the chief occasions for consumption within the convenience channel," says Harris. "Retailers need to think about their customers when stocking their chillers. If the store is located in an area with lots of commuters going to and from work they should focus on stocking chilled adult brands such as J20 or Purdey's. If stores are in areas with lots of schools, retailers should stock a range of juices and juice drinks in smaller formats such as 250ml."
Tropicana managing director David Johnston says: "Over half of all chilled juice is consumed outside of breakfast time so it's important for retailers to be offering consumers a broad range of flavours in addition to orange and apple to cater for drinking occasions throughout the day.
"Smoothies also have great all day appeal - often bought when people need an energy boost but also by consumers with busy lifestyles who want a healthy but quick meal replacement or supplement."
Health is a key concern among consumers and juices and smoothies that carry a healthy on-pack message are more likely to be bought.
"Consumers are becoming more and more discerning about the nutritional content of their soft drinks, and artificial sweeteners are increasingly frowned upon," says Anita Doran, managing director of Hibiscus Drinks Company.
"Consumers are looking for natural, functional products that offer added health benefits and well-being as well as tasting refreshing and delicious."
Rubicon head of marketing Barbara Downs adds: "Function and health continue to be key drivers within soft drinks among health-conscious consumers.
"It's important for manufacturers now to communicate the natural health benefits of their products. Rubicon has always provided a healthy option for consumers so now we're shouting a little bit louder about our health benefits."
One brand that hasn't always been able to shout about its health benefits is Sunny D. During the mid-nineties, the brand received bad press about its artificial ingredients. Owner Sunny Delight Beverages Company decided the brand needed a healthy make-over and organised a parents advisory group to develop a new-look product.
Alison Gardner, a member of this advisory group and also a convenience store retailer, says that there was a very negative attitude towards the product from parents but it was still in demand from children. "It's well-known among children and it was felt that if the artificial ingredients could be taken away then parents would get on board with it too."
The product now contains no artificial flavours and preservatives, and, according to Alison, sales of the drink have grown since the changes.
"Sales of Sunny D have really started to pick up. It's now attractive to both kids and parents."
Another drink that has seen a sales increase due to its health credentials is Calypso's Aquajuice 67 (67% pure juice and 33% natural mineral water).
The brand's sales have grown by nearly 40% in the past six months. Marketing director Richard Cooke claims that its success is largely down to the government's push towards healthier living.
"Soft drinks regulations in schools - only allowing water, milk, pure juice or combinations of these - has driven a healthier sector, which continues to evolve with new nutritional guidelines now in place," he says.
"The 'lighter touch' drinks, such as Aquajuice 67, are seeing huge increases because they fit the bill. They are inexpensive and can provide a healthier and more affordable alternative to energy brands or other premium drinks."
The company states that health will continue to be a priority for juice drinks aimed at kids.
"Health remains an increasingly important issue, particularly for childrens' drinks, as education continues and nutritional awareness becomes mainstream," says Cooke.
And he is adamant that c-store retailers should constantly review their product lines to ensure that they are providing a healthy juice offering at a reasonable price.
"It's no good just educating kids and parents on healthier drinks in school," he says. "It's also imperative that retailers stock them outside schools and make them available at affordable prices."
A number of manufacturers have taken a different approach to the downturn and developed luxury juice and smoothie products to capitalise on consumers' desire to treat themselves more during hard financial times.
Häagen-Dazs has released a range
of ice cream smoothies to tempt
those looking for indulgence and a product that is healthier than the average treat.
Ed Culf, marketing director at General Mills UK, explains the company's entry into the smoothie market: "Our ongoing research programme indicated that consumers are increasingly seeking products with high fruit content. This insight, coupled with our appreciation of a treating trend among consumers, enabled us to identify a gap in the market for a fruity, refreshing and luxurious smoothie."
Haagen-Dazs Ice Cream Smoothies come in two flavours - raspberry & summer berries and mango & apricot.
Tropicana has also entered the luxury market with its Gold Label pure juice range. With flavours including sanguinello Sicilian blood orange, Valencia orange & crushed raspberry and alphonso mango, pineapple & lime, Tropicana hopes to move beyond the breakfast juice occasion and towards evening indulgence.
"Despite the economic situation, health and indulgence remain important category drivers in addition to value," says Tropicana managing director David Johnston. "One significant change is the trend towards 'homedulgence' as consumers are increasingly seeking out treats for entertaining at home rather than dining out. Tropicana's new Gold Label range caters for just such occasions."
"Lunchtime is when we sell the most juice. Our trade usually comes from people grabbing a sandwich on their way back to work and deciding to pick up a bottle or carton of juice too.
"Our most popular brand is Tropicana, but recently Pom Wonderful has become quite popular and plenty of people have been asking for it.
"We're pretty much at the optimum range level right now, with all of the brands we stock moving well. We've stocked more brands before, but the new ones weren't always well received.
"I can see sales of juices and smoothies growing as we move into the summer. More people will be lunching outside and will want a healthy drink that they can consume on the go. We'll also be looking at creating a meal deal with our sandwiches to increase sales."
Alan Fincham, Londis News Extra, Attleborough, Norfolk
Tropicana has a new 100% pure juice for children. Tropicana Kids! is being promoted with a '100% juice and nothing else' message on packs to appeal to parents looking for a healthy drink for their children. Flavours include strawberry & raspberry and apple & blackcurrant.
tel: 01189 306666
Feel the benefit
Feel Good Drinks Company has released its range in environmentally friendly PET 400ml bottles. The packaging is now 100% recyclable. The drinks range comprises flavours including orange & mango; apple & blueberry; cloudy lemon still and sparkling; orange & passionfruit; and cranberry & lime.
tel: 020 7687 7651
Ducking and diving
Oasis has unveiled its latest advertising campaign - RubberDuckZilla. The campaign features a giant duck that doesn't like water in a battle to promote variety. The campaign spans TV, outdoor advertising, print and the internet. TV ads will be aired through Channel 4 show Hollyoaks.
tel: 08457 227 222
Rubicon has launched Sun Exotic sparkling pineapple & coconut in a 330ml can. The drink contains 10% pineapple juice and coconut water. Rubicon is looking to appeal to those craving a 'taste of the tropics' and is an alternative to the existing still variety and Sun Exotic sparkling tropical.
tel: 020 8900 9944
kind of magic
Sunmagic has relaunched its 100% pure juice and smoothie range with new packaging and advertising campaign. Sunmagic is available in 200ml cartons, 330ml cans and PET bottles, 500ml PET bottles and 1ltr cartons. It is is free from artificial colours and sweeteners.
rrp: from 39p
tel: 020 7326 6090