Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Consumer survey data
- Advertising clips
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- American consumers exhibit change in (non-alcoholic beverage) drinking habits
- Health and wellness trends prompt consumers to choose healthy beverages
- Obesity pandemic has caused a shift in consumer preferences
- Consumers are moving away from artificial ingredients in beverages
- American consumers are price sensitive in purchasing beverages
- The need for economy can negatively influence brand loyalty
- Consumers turn “green”; plastic packaging may receive consumer backlash in all beverage types
Insights and Opportunities
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- Men shift to drinking low-calorie beverages, signaling growth potential for diet beverages
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- Figure 1: Trends in personal consumption of soda and bottled water, by gender, 2003 and 2008
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- Figure 2: Attitude towards health, 2004 and 2008
- Current economic climate and a search for the silver lining…
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- Figure 3: POM Wonderful for heart health, Television Ad, 2008
- Aging population needs convenient packaging
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- Figure 4: Desirable functional packaging attributes, by age, December 2008
- Proliferation in portion control packaging can bring change in drinking habit
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- Figure 5: Attitudes toward the role of packaging in informing about the right serving size, December 2008
- “Medicated” beverages are likely to remain a small niche
Inspire Insights
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- Search for the next magic ‘Superfruit’
- Beyond feelings of logic
- Exploring the Amazon…
- ...and beyond
- A simple balance for health
- What's it about?
- What we've seen
Change in Drinking Habits: An Overview
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- Non-alcoholic beverage consumption trends indicate a change in drinking habits
- Soda continues to enjoy the highest consumer penetration, but exhibits decline in consumer base
- Bottled water has expanded its consumer base in the past five years
- Consumers embrace energy drinks with enthusiasm; sports drinks continue to broaden consumer base
- Ready-to-drink iced tea and coffee drinks
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- Figure 6: Trends in personal consumption of RTD beverages, 2003-08
- Household consumption of fruit juice, milk, and coffee also points toward change in consumer preference
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- Figure 7: Trends in household consumption of RTD beverages, 2003-08
- Non-alcoholic beverage dollar and volume sales trends suggest shifting consumer preferences
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- Figure 8: FDMx dollar sales trends for non-alcoholic beverages, 2003- 08
- Figure 9: FDMx volume sales trends for non-alcoholic beverages, 2003-08
- Energy drinks, bottled water top 2008 new product introductions
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- Figure 10: Trends in number of new products in non-alcoholic beverages, by segment, 2003-08
- Market factors influencing changes in consumer purchase beverages
Health and Wellness: Market Factors
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- American consumers grapple with growing waistlines
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- Figure 11: Percentage of population who are overweight or obese, 20-74 years of age, 1988-2004
- Figure 12: Attitude towards health, 2003 and 2008
- Growing consumer concern about the negative side effects of obesity
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- Figure 13: Reasons for watching/controlling diet, 2004 and 2008
- Obesity among children—concern for future obese adults
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- Figure 14: Prevalence of overweight among children and adolescents, 2-19 years of age, 1976-2004
- Obesity and related diseases and beverages: there is a connection
- Sugar in beverages is the culprit—how much sugar do we need?
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- Figure 15: Average sugar* intake on any given day by drinking certain non-alcoholic beverages, by age, 2006
- Growing skepticism toward artificial ingredients
- Consumers increasingly wary about high fructose corn syrup
- Artificial sweeteners on the health-risk watch
- Antioxidant concept takes root in American consumer psyche
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- Figure 16: Welch’s grape juice, Television Ad, 2007
- Figure 17: Welch’s Concord Grape Juice, Television Ad, 2008
Health and Wellness: Innovation and Innovators
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- New product launches with antioxidant claims have exploded to keep up with consumer demand
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- Figure 18: Trends in number of new products in non-alcoholic beverages with antioxidant claim, by segment, 2003, 2005, and 2008
- Figure 19: Trends in number of new products in non-alcoholic beverages by the type of superfruit, 2003, 2005, and 2008
- No additive and preservative claim in new beverages has more than tripled during 2003-08
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- Figure 20: Trends in number of new products in non-alcoholic beverages with no additive/preservative claim, by segment, 2003, 2005, and 2008
- Rising numbers of low/no-sugar claims aim to target the biggest consumer trend: obesity
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- Figure 21: Trends in number of new products in non-alcoholic beverages with low/no sugar claim, by segment, 2003, 2005, and 2008
- Vitamin and mineral fortified—aim to fulfil shortfalls in consumer diet
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- Figure 22: Trends in number of new products in non-alcoholic beverages with vitamin and mineral fortified claim, by segment, 2003, 2005, and 2008
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- Figure 23: Trends in number of new products in non-alcoholic beverages with organic claim, by segment, 2003, 2005, and 2008
Health and Wellness: The Consumer
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- Low-calorie beverages or ones providing low/no-calorie nutrition will garner consumer attention
- Consumers are drinking more antioxidant-rich and vitamin/mineral fortified beverages
- Non-alcoholic beverage users shun high-fructose corn syrup and artificial sweeteners
- Use of packaging as a marketing tool
- Non-alcoholic beverages have growth potential at the expense of alcoholic beverages
- Adults aged 18-24 perceive energy drinks as dangerous
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- Figure 24: Health attributes influencing change in drinking non-alcoholic beverage habits, November 2008
- Blacks and Hispanics more proactive in moving to low-calorie alternative to reduce or manage weight
- More blacks and Hispanics perceive energy drinks as dangerous
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- Figure 25: Health attributes influencing change in drinking non-alcoholic beverages, by race/Hispanic origin November 2008
- Households with children are buying fewer beverages with “bad-for-you” perception
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- Figure 26: Buying more RTD and premium beverages, by gender, November 2008
Price Sensitivity and Affordability: Market Factors
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- Consumers are price sensitive in purchasing beverages
- Key consumer households and nearly 50% of U.S. households fall below median income
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- Figure 27: Household income, by number of households and income group, 2007
- Figure 28: Household income, by age and ethnicity/Hispanic origin of householder, 2006 and 2007
- More discretionary income in the hands of the affluent
- Current economic climate influences change in consumer drinking habits
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- Figure 29: Trends in consumer expenditure on food and beverages, 2003-07
- Consumer demand declines as a result of economic downturn
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- Figure 30: change in volume sales for non-alcoholic beverages, 2006-07 and 2007-08
- Economic downturn prompts consumers to move to private labels
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- Figure 31: Trends in non-alcoholic beverage sales, by private label and branded products marekt share, 2003-08
Price Sensitivity and Affordability: The Consumer
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- Consumer move toward buying more beverages on promotion, in family-size and single-serve multipacks packaging
- Consumers are purchasing more private label beverages to save money
- Opportunities for non-alcoholic beverages to take away sales from alcoholic beverages
- Consumers are saving money by brewing tea and coffee at home
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- Figure 32: Attitudes toward promotion and economic choices in beverages, by age, November 2008
- Blacks and Hispanics are buying more beverages in family-size packaging to save money
- Hispanics are likely to show decline in drinking energy drinks
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- Figure 33: Attitudes toward promotion and economic choices in beverages, by race/Hispanic origin, November 2008
Convenience: Market Factors
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- American consumers are busy, but striving to make life easier
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- Figure 34: Trends in average time use for personal care activities and work-related activities for Americans aged 15 and over, 2003 and 2007
- Working moms experience too much demand on time and energy
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- Figure 35: Weekday time use of married women aged 25-54, by presence of child aged 6 and under in household and status of employment, 2007
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- Figure 36: Trends in personal consumption of RTD beverages, by moms and all women, April 2007-June 2008
- Americans’ increasing need for energy
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- Figure 37: Reasons for drinking energy drinks, by age, May 2008
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- Figure 38: Trends in the number of new products with energy claims in various non-alcoholic beverages, 2003 and 2008
- Portability and the need for immediate consumption
Convenience: The Consumer
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- Consumer shift in drinking RTD coffee, energy drinks, sports drinks, and smoothies for immediate consumption
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- Figure 39: Change in the incidence of purchasing beverages in the last two years for immediate consumption and at-home consumption and purchasing beverages in single-serve packaging, November 2008
Convenience: Innovation and Innovators
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- Trends in the number of new beverage products with convenient packaging claim
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- Figure 40: Trends in the number of new products with convenience packaging claims, 2003-08
Brand Loyalty: Market Factors
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- Growing numbers of line extensions: an effort to hold on to loyal consumers and bring in new consumers
- A line extension with independent positioning may drive sustainable long-term growth
- Innovation in private label, at par with branded products, has challenged brand loyalty
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- Figure 41: Growing number of new private label beverages, 2003-08
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- Figure 42: Private label sales as a percent of total FDMx sales of certain non-alcoholic beverages, 2003-08
Brand Loyalty: The Consumer
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- More than a third of all adults exhibit brand loyalty toward their favorite brand; young adults are least likely to be brand loyal
- Coupons and promotions are an integral part of purchase behavior among brand loyal consumers
- Consumer switch to private labels because private labels offer comparable quality to and cheaper prices than branded beverages
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- Figure 43: Factors influencing change in brand loyalty, by age, November 2008
Sustainability: Market Factors
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- Growing backlash against plastic in bottled water
- Low recycling rates in plastic may extend consumer backlash to other non-alcoholic beverage categories
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- Figure 44: Recycling rates, by material and packaging type, 2006
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- Figure 45: Nestlé environmental-friendly packaging, Television Ad, 2008
Sustainability: The Consumer
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- A majority of non-alcoholic beverage buyers do not relate to environmental issues in beverages…
- … but growing awareness about harmful influence of plastic on the environment and health is likely to negatively influence the non-alcoholic beverage industry
- Young adults and Hispanics, the key beverage consumers, are more aware of negative environmental consequences of plastic waste
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- Figure 46: Concern for environment and beverage purchase behavior in the past two years, by age, November 2008
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- Figure 47: Concern for environment and beverage purchase behavior in the past two years, by race/Hispanic origin, November 2008
Sustainability: Innovation and Innovators
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- Number of new beverages with environmental-friendly packaging claims is on the rise
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- Figure 48: Trends in the number of new products with environmental-friendly packaging claims, 2003-08
- Packaging made from 100% recycled material
- Packaging made from using less plastic
- Water bottles made from plant-based plastic
Changes in Drinking Habit: Demographic Influences
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- Women have given impetus to pro-health and low-calorie beverages
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- Figure 49: Attitudes towards health, by gender, February 2007-March 2008
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- Figure 50: Reasons for watching/controlling diet, by gender and custom women demographic, April 2007-June 2008
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- Figure 51: Perception of health attributes influencing change in drinking non-alcoholic beverages, by gender, November 2008
- Women tend to be budget-conscious
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- Figure 52: Attitudes towards health, by gender, July 2007-September 2008
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- Figure 53: Attitudes towards buying beverages on promotion, by gender, November 2008
- Young adults aged 18-24 have stimulated growth through energy drinks
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- Figure 54: Trends in the personal consumption of energy drinks, sports drinks, bottled water, and soda, by age 2003 and 2008
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- Figure 55: Change in the number of consumers in certain non-alcoholic beverage segments, by age group, during 2003-08
- Beverages targeting geriatric population are likely to thrive and may fuel growth in the market overall
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- Figure 56: U.S. population of adults aged 18 and over, by age group, 2003-13
- Ethnic population also exhibits changes in drinking habits
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- Figure 57: Trends in the personal consumption of energy drinks, sports drinks, bottled water, and soda, by race/Hispanic origin 2003 and 2008
Cluster Analysis
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- Maintainers
- Who they are
- Opportunity
- Changers
- Who they are
- Opportunity
- Rearrangers
- Who they are
- Opportunity
- Cluster characteristics
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- Figure 58: Drinking clusters, November 2008
- Figure 59: Incidence of drinking various non-alcoholic beverages, by drinking clusters, November 2008
- Figure 60: Health attributes influencing change in drinking non-alcoholic beverage habits, by drinking clusters, November 2008
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- Figure 61: Attitudes toward promotion and economic choices in beverages, by drinking clusters, November 2008
- Figure 62: Incidence of purchasing beverages for convenience and status, by drinking clusters, November 2008
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- Figure 63: Concern for environment and beverage purchase behavior in the past two years, by drinking clusters, November 2008
- Figure 64: Health attributes influencing change in drinking non-alcoholic beverage habits, by drinking clusters, November 2008
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- Figure 65: Factors influencing change in brand loyalty, by drinking clusters, November 2008
- Cluster demographics
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- Figure 66: Drinking clusters, by gender, November 2008
- Figure 67: Drinking clusters, by age group, November 2008
- Figure 68: Drinking clusters, by income group, November 2008
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- Figure 69: Drinking clusters, by race, November 2008
- Figure 70: Drinking clusters, by Hispanic origin, November 2008
- Cluster methodology
Appendix: Other Useful Tables
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- Health and wellness attributes contributing to change in non-alcoholic beverage consumption
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- Figure 71: Health attributes influencing change in drinking non-alcoholic beverages, by gender, November 2008
- Figure 72: Health attributes influencing change in drinking non-alcoholic beverages, by income, November 2008
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- Figure 73: Health attributes influencing change in drinking non-alcoholic beverages, by presence of children, November 2008
- Price sensitivity and affordability
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- Figure 74: Attitudes toward promotion and economic choices in beverages, by gender, November 2008
- Figure 75: Attitudes toward promotion and economic choices in beverages, by income, November 2008
- Figure 76: Attitudes toward promotion and economic choices in beverages, by presence of children, November 2008
- Sustainability
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- Figure 77: Concern for environment and beverage purchase behavior in the past two years, by gender, November 2008
- Figure 78: Concern for environment and beverage purchase behavior in the past two years, by income, November 2008
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- Figure 79: Concern for environment and beverage purchase behavior in the past two years, by presence of children, November 2008
Appendix: Trade Associations
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