Why is the soft drink industry so profitable
An Overview of the Global Soft Drinks Market in 2017
the first important point to make about
the world of soft drinks in 2016 and
heading into 2017 is to despite the
volatility that we've been seeing in the
industry it has been a year of growth we
see 3% global volume growth and soft
drinks for 2016 and that's led mainly by
the bottled water category but also some
enhanced water categories coconut
another plant water did very well energy
drinks and high-value premium products
2016 and 2017 in the industry will not
be without big challenges for the soft
drinks industry and one of those perhaps
the biggest challenge is the prominence
of sugar and sugar reduction in the
diets of consumers now this is not just
at a developed market phenomenon
increasingly we're seeing regulatory
pressure cause the tax increases and
more attention being placed on sugar
when it comes to developing market
consumers as well so this is something
that's going to remain top of mind for
both brands governments and consumers in
2017 one category that's performed
particularly well in 2016 and we
anticipate will do very well in 2017 a
premium hydration products so that's
waters or enhanced waters with some
added value in terms of functionality
sports drinks continue to perform very
well functional waters products like
vitamin water have done extremely well
and all natural hydration products like
coconut water and other plant waters
were a big success story in 2016 and
heading into 2017 one category that is
forced to reinvent itself over the next
several years is going to be carbonate
for the sparkling category volumes are
down in many developed markets or the
value sales have managed to inch up
based mainly on smaller package sizes
and more premium products but we're
seeing more alternative sparkling
products products like Lacroix or
sparkling ice in the US there were big
success stories globally and we'll
anticipate more ways that brands can
bring out lower sugar or zero sugar
sparkling products in 2017 the energy
drinks category also remains a success
story although it has matured over the
last couple of years one aspect of you
drinks that is driving growth now is
innovation a new package sizes are
larger package sizes as well as flavors
and so we saw monster and Red Bull
bringing out new flavor extensions to
their existing portfolios and the
natural energy as well was a something
that we anticipate will be a consumer
interest over their forecast period
brewed beverages meaning RTD coffee and
RTD t demonstrated fairly strong growth
as well in 2016 heading into 2017 lower
sugar tees and premium all-natural tees
were a success story starbucks exhibited
double-digit value growth with its RTD
coffee products in 2016 and we would
anticipate more strong growth there as
well and then another aspect of brewed
beverages is cold brew coffee which is
increasingly making the transition from
a niche product into the mainstream and
then finally one big success story in
2016 has been super premium juices the
juice category is a whole particularly
hundred percent juice is not performed
as well as it has in the past however
the highest tier of single serve super
premium juices products like Odwalla and
maked and innocent in the UK these
continue to demonstrate strong growth
and we would expect this to be a real
point of innovation for manufacturers
over the next year
