Functional soft drinks for healthier life
With another 8% growth in 2003 to 3,780 million litres, West Europe’s functional soft drinks sector has become a force to be reckoned with, according to the 2004 West Europe Functional Soft Drinks report from leading drinks consultancy Zenith International.
Functional soft drinks are now attracting the interest of beverage multinationals, entrepreneurs and consumers alike. These products provide a health benefit beyond their basic nutritional content, by virtue of their physiologically active added components. Zenith’s report tracks four main functional soft drinks segments: enriched beverages, such as juices and waters with added vitamins and minerals; sports drinks; energy drinks; and nutraceuticals, with targeted ingredients considered to provide specific medical or health benefits.
Nutraceuticals are the fastest growing segment, albeit from a low base, with volume up 39% in 2003. Sports drinks also demonstrated strong double figure growth, up 27% in the year. Enriched beverages are by far the largest group, with more than three quarters of overall volume in 2003. Sports drinks came second on 13%, followed by energy drinks on 8% and finally nutraceuticals on 3%. The United Kingdom and Germany are the biggest national markets, with a combined 69% volume share. Italy, Spain and France complete the top five.
"Functional soft drinks are small when compared with the scale of mainstream categories. Yet they offer the potential of moving beyond customer satisfaction to a new level of consumer commitment," commented Zenith Research Director Gary Roethenbaugh.
Zenith identifies a range of factors that point to the growing importance of functionality:
Major soft drinks manufacturers are increasingly turning to ‘added functionality’ as a means of enlivening mainstream products.
Smaller players have embraced functionality in order to differentiate their product offerings.
Health and well being have become critical public policy issues, as the world tackles an obesity epidemic and its associated health concerns.
As price pressures squeeze the margins and thus the future investment programmes of soft drinks operators, functionality provides a route to future profitability.
"Since the 1990s, consumer behaviour and attitudes have changed," added Gary Roethenbaugh. "Our interaction with the media and our relationship with brands have become more personalised. This lends itself to a more fragmented marketplace and one in which functional soft drinks can flourish."
Many challenges remain, such as effective marketing communication, the need for consumer education and intense competition to secure distribution. But the fundamental importance of health and well being should pave the way for continued functionality growth. By 2008, Zenith anticipates that total functional soft drinks sales across West Europe will have risen by at least a further 1,000 million litres.
The 2004 Zenith Report on West Europe Functional Soft Drinks contains 213 pages including 87 tables and charts, 255 new product launches, details on national regulations and a comprehensive market commentary. Contact Zenith International on tel +44 (0)1225 327900, fax +44 (0)1225 327901 or e-mail info@zenithinternational.com
For further information, please contact:
Gary Roethenbaugh or Sophie Carkeek, Zenith International Ltd
7 Kingsmead Square, Bath BA1 2AB, United Kingdom
t +44 (0)1225 327900 f +44 (0)1225 327901
zenithinternational.com
Functional soft drinks are now attracting the interest of beverage multinationals, entrepreneurs and consumers alike. These products provide a health benefit beyond their basic nutritional content, by virtue of their physiologically active added components. Zenith’s report tracks four main functional soft drinks segments: enriched beverages, such as juices and waters with added vitamins and minerals; sports drinks; energy drinks; and nutraceuticals, with targeted ingredients considered to provide specific medical or health benefits.
Nutraceuticals are the fastest growing segment, albeit from a low base, with volume up 39% in 2003. Sports drinks also demonstrated strong double figure growth, up 27% in the year. Enriched beverages are by far the largest group, with more than three quarters of overall volume in 2003. Sports drinks came second on 13%, followed by energy drinks on 8% and finally nutraceuticals on 3%. The United Kingdom and Germany are the biggest national markets, with a combined 69% volume share. Italy, Spain and France complete the top five.
"Functional soft drinks are small when compared with the scale of mainstream categories. Yet they offer the potential of moving beyond customer satisfaction to a new level of consumer commitment," commented Zenith Research Director Gary Roethenbaugh.
Zenith identifies a range of factors that point to the growing importance of functionality:
Major soft drinks manufacturers are increasingly turning to ‘added functionality’ as a means of enlivening mainstream products.
Smaller players have embraced functionality in order to differentiate their product offerings.
Health and well being have become critical public policy issues, as the world tackles an obesity epidemic and its associated health concerns.
As price pressures squeeze the margins and thus the future investment programmes of soft drinks operators, functionality provides a route to future profitability.
"Since the 1990s, consumer behaviour and attitudes have changed," added Gary Roethenbaugh. "Our interaction with the media and our relationship with brands have become more personalised. This lends itself to a more fragmented marketplace and one in which functional soft drinks can flourish."
Many challenges remain, such as effective marketing communication, the need for consumer education and intense competition to secure distribution. But the fundamental importance of health and well being should pave the way for continued functionality growth. By 2008, Zenith anticipates that total functional soft drinks sales across West Europe will have risen by at least a further 1,000 million litres.
The 2004 Zenith Report on West Europe Functional Soft Drinks contains 213 pages including 87 tables and charts, 255 new product launches, details on national regulations and a comprehensive market commentary. Contact Zenith International on tel +44 (0)1225 327900, fax +44 (0)1225 327901 or e-mail info@zenithinternational.com
For further information, please contact:
Gary Roethenbaugh or Sophie Carkeek, Zenith International Ltd
7 Kingsmead Square, Bath BA1 2AB, United Kingdom
t +44 (0)1225 327900 f +44 (0)1225 327901
zenithinternational.com