Carbonates in Estonia

PROSPECTS

New healthier product developments help to offset stagnating demand

Soft drinks retail volume sales fell slightly in 2019, after rising strongly in 2018 due to the impact of an unusually long and hot summer. However, current value sales still increased moderately, partly due to new product developments.

No agreement yet on implementation of sugar tax

No definite steps to implement a sugar tax have been taken by the Estonian government. The World Sugar Research Organisation sent a query to the Estonian government in July 2018.

Negative publicity to limit growth opportunities within carbonates

Carbonates is already a mature category in Estonia, with a rather high per capita consumption rate. In addition, due to the negative publicity the category has received as a result of increasing consumer awareness and the sugar tax discussion, producers have been struggling to drive growth.

COMPETITIVE LANDSCAPE

No change at top as Coca-Cola benefits from widespread distribution

Coca-Cola HBC Eesti continues to lead carbonates off-trade value sales in Estonia, with the company’s global Coca-Cola, Fanta and Sprite brands having established very strong positions. Local producer A Le Coq held second position in 2019 due to the popularity of its Limonaad, Kelluke and Valge Klaar ranges.

Growing competition from flavoured bottled water

Carbonates in Estonia is seeing strong competition from other soft drinks categories, especially bottled water, which is an innovative and dynamic category that has managed to attract consumers’ attention with constant new product developments. Furthermore, sales of bottled water are also being boosted by the prevalent health and wellness trend, with carbonates often being left on the shelves of supermarkets due to their unhealthy image.

Scope for smaller domestic players to gain sales share

As consumers are paying more attention to the ingredients in products, some smaller local producers which highlight the natural content of their products are likely to start taking share from big multinationals. An example of such a producer is ÕUN Drinks OÜ, a small local player that promotes its Õun soft drinks brand.

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