Carbonates in Colombia

PROSPECTS

Sales of carbonates recover in 2018

After a strong decline in sales in 2017, carbonates saw a better year in 2018, with sales returning to positive rates. The dynamism of manufacturers with strong promotional activities in-store with the offer of multipacks of family-sized bottles with assorted flavours and the FIFA World Cup celebrated during June and July pushed demand for carbonates, because most matches took place early in the morning or early afternoon, with consumers choosing soft drinks over alcoholic drinks.

Reduced sugar carbonates seeing rapid growth

Concerns regarding sugar intake and the threat of taxes being imposed on sugary beverages have been driving demand and reformulation of carbonates, which has been increasingly evident since 2017. In cola carbonates, FEMSA offers three alternatives of reduced sugar Coca-Cola and in 2018 launched a campaign that is encouraging consumers to alternate between regular and reduced sugar products.

Carbonates with fruit content struggling to catch attention

Carbonates with fruit content are still questioned by consumers who remember carbonated juices, products that were introduced in Colombia, but were not able to survive, and many do not fully understand that a carbonate can be healthier by adding juice content. In 2017, Postobón launched Postofrut with a 12% juice content, but by 2018 the product had disappeared from retailers’ shelves.

COMPETITIVE LANDSCAPE

Traditional players FEMSA and Postobón remain on top

These two big companies have been struggling for share for a number of years, despite both having strong distribution networks. However, FEMSA is the leader by far in cola carbonates, which most of its marketing activities focused in Coca-Cola, in both mass media and in-store promotions that led to a lower price per litre.

Sales of Peruvian Aje continue falling

Despite Colombians considering price as a key variable for decision making, and more so in an economically stressful environment, the disruptive price strategy of Aje in carbonates is not attracting consumers in large numbers and sales continued displaying negative growth in 2018 for the second year in a row. Colombians continue choosing traditional brands that offer frequent price promotions or other regional or smaller brands such as Glacial, Pool or Klie, which are seen more often on retailers’ shelves.

Carbonates are competing with healthier alternatives in the on-trade

Sales of carbonates through consumer foodservice operators exhibited low growth, as healthier alternatives for consumers are widening from bottled water, premium RTD teas or freshly-prepared products such as lemonade, juices or smoothies, and are not expected to post dynamic growth in the on-trade over the forecast period.

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