Good performance despite the economic downturn
Since the onset of the economic downturn, sugary and artificially sweetened beverages underwent an increase in excise tax and an increase in VAT on sweetened beverages in the on-trade channel. Despite this, the soft drinks industry continued to perform well with total volume growth of 2% and off-trade value sales of 4%, which corresponded to the performance of the review period.
Increased taxes for sweetened beverages
On 1 January 2012, two new taxes came into effect. One on soft beverages with added sugar, including carbonates, fruit juice with added sugar and flavoured milk drinks, and the other, to considerable disbelief, on artificially sweetened soft beverages. The new budget law increased the excise tax to EUR7.7 per hectolitre on soft drinks with added sugar and added artificial sweeteners. The French government also increased VAT from 5.5% to 7% for sweetened beverages designed for instant consumption in the on-trade channel.
Internationals sustain their lead in soft drinks
In 2012, international companies took advantage of various public events in order to improve their brand image. The energy drinks manufacturer Red Bull emphasised its slogan, “gives you wings” by sponsoring Felix Baumgartner’s stratospheric free-fall, while Coca-Cola supported the Olympic Games in London. As a result, Coca-Cola experienced increased value sales in 2012 and continued to be among the leaders in soft drinks.
The on-trade channel is a source of innovation
Although the off-trade channel represents the majority of volume and value sales of soft drinks, manufacturers focused their innovation in the on-trade. Due to the developing health and wellness trend and on-the-go-consumption, manufacturers introduced new healthy products in small sizes so that they could be sold in the on-trade channel, particularly in vending machines. Coca-Cola, for example, launched its stevia-based Nestea brand in vending before relaunching the range in store-based retailing channels. Nemeco also expanded its range of individual smoothies under the Nu brand.
Increasing demand for natural and safe beverages
With French consumers becoming more health and wellness conscious, they are likely to prefer natural healthy beverages, such as 100% juices and bottled water. Moreover, consumers are likely to avoid consuming soft drinks that contain artificial sweeteners, such as aspartame, as its impact on the health is unclear. As a result, soft drinks manufacturers are expected to change the formula of their best-selling products through the use of stevia instead of aspartame.
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The Soft Drinks in France market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- What is the market size of Soft Drinks in France?
- What are the major brands in France?
- What potential exists for multinational vs. local soft drinks companies looking to increase market share?
- How have changing social attitudes affected soft drink sales?
- How have sustainability issues; such as environmentally-friendly packaging, legislation on recyclability, or the amount of plastic in bottles, affected the soft drink industry?
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This industry report originates from Passport, our Soft Drinks market research database.