Carbonates in Costa Rica

2021 DEVELOPMENTS

The trend towards larger formats is sustained in 2021 as consumers continue to spend considerable time at home

The impact of the ongoing presence of COVID-19 in the country on sales of carbonates continues to be reflected in the growing popularity of larger family sizes presentations, where consumption occasions continue to move to the home and consumers continue looking for more affordable value-for-money alternatives, given the subsequent economic slowdown. In this context, value packs of assorted carbonates (both cola and non-cola) along with promotional unit prices continued to move demand forward across modern grocery retailers, where brand recognition and point-of-sale activities are commonplace and set the pace.

Zero sugar becomes an increasingly attractive claim, appealing to consumers’ heightened wellness consciousness and health goals

Low calorie and no sugar carbonates have become much more in vogue since the start of the pandemic, with many players reformulating and repositioning their regular brands. This is in response to a larger consumer base which gained additional awareness of the importance of their own health and wellbeing since the global health crisis.

The category remains consolidated with Coca-Cola FEMSA Costa Rica maintaining its strong lead

In Costa Rica, Coca-Cola FEMSA Costa Rica SA continues to dominate carbonates by far in current value terms. Coca-Cola’s brands (including Coca-Cola, Fanta and Canada Dry) and Florida Betides’ Pepsi continue to hold the most shelf space across modern and traditional grocery retailers.

PROSPECTS AND OPPORTUNITIES

Gradual recovery anticipated in the on-trade thanks to the return of tourists and wider mobility amongst locals

After the impact of COVID-19 on the country’s overall economic performance begins to fade, the retail performance of carbonates will continue to compensate for the gradual and slow recovery of on-trade demand, which will experience more difficulties in returning to normality after the strong drop experienced since the start of the pandemic, particularly in 2020. As restrictions ease, local consumers are likely to become more mobile again and tourists are set to return, which will push on-trade sales and impulse formats, where fast food chains and small independent grocers should bounce back, achieving a full sales’ recovery around 2023.

Growing health and wellness concerns characterise the forecast period

Consumer demand for healthier proposals is set to continue gaining momentum, particularly evident in low calorie cola carbonates and non-cola carbonates. This trend has mostly benefitted the perceptions of brands such as Coca-Cola, and sugar-free alternatives, such as Diet Coke and Pepsi Black.

Development of non-store retailing, particularly e-commerce and vending

While modern and traditional grocery retailers are expected to continue representing the most important distribution channels in the forecast period, distribution is most certainly expected to move further towards online channels. In particular, mid- and upper-income families are anticipated to continue gaining interest in e-commerce grocery shopping by 2026.