The beverages rising above the pack in a turbulent market

Posted by Isobel Drake on 31st March 2009

In challenging times, the American refreshment beverage market contracted by 2.0% in 2008, according to Beverage Marketing Corporation, but some beverage types continued to shine.

During the first several years of the 21st century, newer beverage categories have been principally responsible for what growth has occurred in the non-alcoholic marketplace. Carbonated soft drinks accounted for close to half of total liquid refreshment beverage volume. However, their market share eroded slightly, as it has for several years. Energy drinks, enhanced bottled waters and ready-to-drink coffee, in contrast, were seen to continue to garner further customer support.

Carbonated soft drinks held five of the top ten positions in the rankings of trademarks by volume. Those were joined by three bottled water trademarks. The biggest sports beverage in the United States ranks as the fifth biggest liquid refreshment beverage trademark. The sole fruit beverage trademark in the group stood in seventh place in terms of volume.

Although bottled water had three trademarks among the top ten in 2008, up from two the previous year, the category also registered an unprecedented decline in volume. Looking for ways to reduce spending, some consumers have gone back to the tap.

The performances of the leading companies’ liquid refreshment beverage portfolios reflected the downward tendency characterising the marketplace as a whole. Coca-Cola’s total volume dipped by 2% in 2008, while Pepsi’s was off by 5% compared to the previous year. However, even in the hard hit carbonated soft drink category, some brands had strong showings. The Coke Zero trademark grew by 25% and Pepsi Max received a 45% boost.

The major manufacturers still dominate the landscape, with Pepsi-Cola (five brands), Coca-Cola (three), the Dr Pepper Snapple Group (one) and Nestlé (one) accounting for all of the top-ten trademarks.

“In today’s uncertain climate, consumers seek value,” noted Michael Bellas, Chairman and CEO, Beverage Marketing Corporation. “Responsive beverage companies are looking for ways to give it to them.”

Some smaller categories, especially those emphasising functional benefits, saw solid growth in 2008. Energy drinks volume increased by 9.0%. Flavoured and enhanced water grew by 8.3%. The ready-to-drink coffee segment also advanced. However, none of these categories has a brand big enough to stand among the top ten.