Carbonates in New Zealand

PROSPECTS

Revamps and reformulations for reduced-sugar variants

Manufacturers continued to introduce reduced- or no-sugar formulations over the review period, which, to date, have had limited success. Both Cola Life and Pepsi Next, which saw big-spend marketing introductions in 2015, have all but gone as the stevia mix formulations did not meet consumer taste expectations, due to bitter aftertastes.

Craft and premium carbonates continue to develop

To attract consumers to the carbonates category, a concerted effort has been made by manufacturers to produce more premium-style carbonated beverages. These are based on trendy craft-brewed alcoholic drinks, such as beer and cider.

Smaller pack sizes for portion control

Committed to controlling sugar intake, manufacturers have introduced initiatives that include smaller-sized can options for portion control, thus reducing sugar intake without compromising on the taste profile, which had happened with several carbonates using sugar alternatives.

COMPETITIVE LANDSCAPE

Coca-Cola Amatil (NZ) Ltd continues to dominate

Despite changes within the cola portfolio of the flagship brand Coca-Cola over the review period, Coca-Cola Amatil (NZ) Ltd continues to dominate the carbonates category, recording a minimal off-trade value share increase in 2018. This was predominantly based on new introductions of No Sugar cola variants, while outgoing cola variants were still on store shelves, seeing a slight transitional period.

Frucor a strong number two player

Frucor Suntory New Zealand Ltd continued to hold second place in carbonates, albeit well behind Coca-Cola Amatil (NZ) Ltd. The Pepsi brand continued to struggle as a cola alternative, with declining off-trade value sales year-on-year over the review period, while the Pepsi brand was discontinued through several fast food banners in the on-trade channel.

New entrants continue to be seen

Despite the two top companies accounting for three quarters of total off-trade value sales in carbonates, a number of smaller companies continued to find niche opportunities to fill within the category, introducing more premium-style products through companies such as the Bundaberg Brewed Drinks Pty Ltd, The Better Drinks Co Ltd and Lion Nathan Ltd. However, on the flip side, private label lines continued to move into non-cola categories, such as mixers, threatening well-established brands such as Schweppes.

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