Carbonates in Finland

PROSPECTS

Health and wellness and premium launches expected to drive value growth despite lower demand for carbonates over the forecast period

The negative impact on carbonates resulting from implementation of the sugar tax in 2014 began to fade towards the end of the review period, with sales boosted substantially from 2017 onwards by multipack sales of the most popular carbonates brands – Coca-Cola, Pepsi and Hartwall Jaffa. Volume growth peaked in 2018 due to an exceptionally hot summer, which drove sales significantly.

Innovations with reduced-sugar content appeal to Finns, inviting new players and brands to provide new options

Within carbonates, innovations in reducing the sugar content especially appeal to Finns. For example, the new domestic company Rajamäen Raikastusjuoma generated interest in 2019 by introducing the first-ever apple cider vinegar drink in Finland; with no added sugar or artificial sweeteners, it is touted as a healthier option when compared to standard carbonated drinks.

In line with health and wellness trends, hybrid carbonates containing juice and functional ingredients are introduced in 2019

Hybrid products, functional, health and wellness and more unique personalised products were introduced in 2019, and are expected to perform well. For example, in non-cola carbonates Hartwall introduced Mountain Dew Jumpstart Black Cherry with real juice and containing half of the sugar when compared to that contained in standard carbonates and offering hybrid functions with added caffeine.

COMPETITIVE LANDSCAPE

Local companies strengthen their positions by emphasising local origin and offering more premium carbonates

While multinationals Coca-Cola and PepsiCo continued to dominate sales of cola carbonates in 2019, domestic company Hartwall strengthened its lead in non-cola carbonates and third-ranked local player Olvi Oyj gained value share over second ranked Coca-Cola after also posting the highest (double-digit) growth in that category. In the highly competitive environment domestic manufacturers are effectively emphasising their domestic origin.

New launches help drive the two Finnish players’ growth in 2019

New launches that helped to dynamize the two Finnish players’ sales growth in 2019 came with more real fruit juice content and exotic flavours and flavour combinations, as adding new flavours helps to invigorate interest and sales. The yuzu fruit – a hybrid of mandarin orange and the ichang papeda that originated in central China and which has a distinctive taste akin to a cross between grapefruit and lime, has been increasingly featured in the new product developments.

Besides employing the usual marketing strategies, players are also hearing and responding to consumers’ wishes

Carbonates players employed many strategies, including marketing, advertising and social media in 2019. They also heard and responded to consumers’ wishes.

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