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Premium Fruit Flavours Boost European Carbonates

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Unfortunately for drinks brand developers, consumer trends in beverages are not always consistent. Despite widespread concern over sugar content and synthetic additives in carbonated options, energy drinks and sports drinks have experienced strong growth in volume terms. Likewise, while per capita consumption of juice is on the decline in developed markets, there is still a strong desire for fruit flavours among many developed market consumers of soft drinks. Sparkling waters or sodas with fruit concentrate as a key ingredient (in varying quantities) have been a prominent area of product development over the past year, particularly in Western Europe.

Despite pressure on RTD 100% juice products, juice has emerged as a popular sweetener alternative for a variety of sparkling beverages, including non-cola carbonates and sparkling waters. Manufacturers and brand owners have attempted to leverage this ‘natural’ positioning of juice to flavour their products. These new juice based sodas brands typically boast 1-10% juice content, occasionally fruit pulp, lower sugar content that other fruit sodas and less sweet flavour profiles than traditional CSDs.

Two examples

In its home German market, Eckes AG released Die Limo brand juice based lemonade in April 2013. The carbonated product offers a less sweet flavour profile and familiar fruit flavours, with an emphasis on flavour and refreshment. The packaging – a red, clear PET bottled with distinctive red screw top – is extremely distinctive. Eckes hopes the launch will leverage its reputation for fresh, natural juices in the more indulgence positioned segment of fruit flavoured carbonates, reaching new consumers by creating cross-category appeal.  Early indications of sales growth in Germany have been positive.

Likewise, in April 2014 Coca-Cola Enterprises introduced Finley brand carbonates to the French market. This line of less-sweet fruit flavoured beverages also incorporated fruit juice as an ingredient, leveraging the healthier image of juice in the carbonates category. The product is targeted to adult consumers, with a series of more complex flavour profiles (Lemon & Elder Blossom, Grapefruit & Blood Orange) that may be equally appropriate for individual consumption or mixing with clear spirits.

In the UK, Belvoir Farms also offer pressé format beverages – premixed RTD fruit juice concentrate and sparkling spring water blends – in 14 fruit flavour varieties. Across the continent a variety of sparkling fruit beverages continue to be introduced with premium price points and superior natural, fruit based positioning.

Who is the target?

There are several advantages to fruit based carbonates development in Europe. First, new launches may be seen as an effort to win new or lapsed consumers in the carbonates category through new and unfamiliar flavours. Flavour profiles are frequently ‘drier’ or less sweet, with more sophisticated flavour blends than traditional non-cola carbonated drinks. These indulgent flavour profiles can attract older consumers and expand brand interest beyond the traditional younger consumer demographics that dominate cola brand marketing. While this is not expected to be a major mover of category volume in the carbonates space overall, it is important for carbonates manufacturers to find new ways to engage an older, more health conscious group of consumers that have avoided or exited the category in recent years.

Another advantage is the distinction between added sugars and the naturally occurring sugars that can be added through fruit based sweeteners and flavours. While the health benefits of naturally occurring fructose versus added or processed sweeteners are unclear, there is a considerable marketing benefit to the use of fruit based sugars and the appearance of less processed ingredients. These claims may help to alleviate the concerns of wellness minded consumers who have exited the category for less sweet waters or other options.

Furthermore, fruit-flavoured carbonates and other premium packaged, uniquely flavoured varieties can capitalise on the rise of cocktail culture and growing interest in alcoholic mixed drinks which has provided a welcome source of revenue growth in both off-trade and on-trade sales of alcoholic beverages. Schweppes introduced a range of premium mixers in Belgium and other European markets in 2013, intended specifically for mixing with gin based cocktails. In November 2012, UK premium soft drinks brand owner Fentimans – a premium carbonates brand - partnered with Bloom London Dry Gin to release a 6.5% ABV RTD gin & tonic product, offered in the same distinctive, premium glass bottles as the Fentimans soft drink line.

In addition to an attempt to reach more mature consumer types through sophisticated flavours, the current wave of fruit flavoured carbonate products also seek to open up a new use occasions. The impact of these products as alcoholic mixers should be considered, particularly as a growing use occasion in foodservice channels. A European boom in fruit-flavoured RTD alcoholic drinks over the last decade has ended in the past several years, potentially bolstering the use of soft drinks as at-home or on-trade mixers for popular cocktails. Sales of direct mixers – such as ginger ale and tonic water – increased in Europe in 2013, one of the few carbonates categories to experience year-on-year total volume growth. A new generation of fruit flavoured sodas may be a way to introduce new, unfamiliar sodas for these after-hours drinking occasions.

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