Carbonates in Italy

2021 DEVELOPMENTS

Return on-trade channel sees dip in off-trade volume sales in 2021

The exigencies of the Coronavirus (COVID-19) pandemic saw the introduction of measures to stem the spread of the virus, such as lockdown and home seclusion, travel restrictions, remote working and distance learning and few social occasions outside the home. These factors boosted the retail demand and at-home consumption of carbonates, especially low calorie and regular cola carbonates, in 2020.

Focus in terms of innovation helps cola carbonates outperform non-cola carbonates

The economic fallout of COVID-19, such as reduced disposable incomes and purchasing power and job losses and insecurity, hinders the demand for carbonates. Carbonates is a category that is vulnerable to fluctuations in the economy as these products are perceived as non-essential.

Despite a shift to the off-trade channel, key players prepare for the resumption of the foodservice channel

Amid growing health concerns in the wake of the outbreak of the COVID-19 pandemic, including increasing consumer awareness of the potential harm to health caused by high sugar intake, reduced sugar cola carbonates and low calorie cola carbonates have attracted significant interest in 2020 and 2021. This trend is reflected in the positive performances of Coca-Cola HBC Italia’s Coca-Cola Zero Sugar and PepsiCo Beverage Italia’s Pepsi Max Zero.

PROSPECTS AND OPPORTUNITIES

On-trade channel recovery expected to hinder growth potential of carbonates in the retail channel

The progressive return to out-of-home consumption is set to directly hamper the demand for carbonates in the off-trade over the forecast period. As consumers resume pre-pandemic work, school and social and leisure norms and the economy recovers, they are expected to spend more time and money in foodservice outlets.

Taking the sugar out of carbonates represents a major challenge for manufacturers

Economic uncertainty and the health and wellness trend are expected to hinder sales of carbonates over the forecast period. However, there are positive factors likely to support growth in the category.

Rising availability of brands to add dynamism to discounters’ performance

The pandemic has seen channel shifts in the retailing of carbonates in Italy. Two of the distribution channels to have benefited most from the exigencies of the pandemic, in both 2020 and 2021, are discounters and e-commerce.