Non-alcoholic Beverages at Restaurants - US - June 2012

SCOPE AND THEMES
What you need to know
Definition
Data sources
Consumer survey data
Advertising creative
Abbreviations and terms
Abbreviations
Terms
EXECUTIVE SUMMARY
The market
Figure 1: Fan chart of market value for U.S. restaurant sales, at current prices, 2006-16
Market factors
Consumer confidence rattled but improving
Figure 2: Consumer Sentiment Index, March 2007-April 2012
Shifts in population
Figure 3: U.S. population change, by age, 2011-16
Linking consumption of sugary non-alcoholic beverages with obesity
Figure 4: Age-adjusted prevalence of being overweight among adults aged 20 or older, 1988-2010
Beverage menu trends
Figure 5: share of leading types of non-alcoholic beverage on the menu, Q1 2012
The consumer
Shifts in consumption
Figure 6: Shifts in non-alcoholic beverage consumption at restaurants, March 2012
Health perceptions
Figure 7: Health perceptions, March 2012
Ordering behavior
Figure 8: Ordering behavior, March 2012
Decision influencers
Figure 9: Decision influencers, March 2012
Frequency of non-alcoholic beverage purchases at restaurants
Figure 10: Frequency of non-alcoholic beverage purchases, March 2012
Effective marketing strategies
Figure 11: Effective marketing strategies, March 2012
What we think
ISSUES IN THE MARKET
How will health trends impact the market?
Figure 12: American Beverage Association TV ad, We’re Delivering, February-May 2012
How can restaurants sate consumer demand for variety?
How can restaurants create interest on the beverage menu?
INSIGHTS AND OPPORTUNITIES
Healthy beverage innovation
Put some sparkle on the menu
Energizing beverages
Water beverages
Spotlight the beverage menu
INSPIRE INSIGHTS
Trend: Carnivore, Herbivore...Locavore
Trend: Access All Areas
MARKET DRIVERS
Restaurant sales showing signs of recovery
Figure 13: U.S. restaurant sales, at current prices, 2006-16
Figure 14: NRA performance indices, January 2009-March 2012
Consumers may still be apprehensive about spending
Figure 15: Real personal disposable income, January 2007-March 2012
Figure 16: Median household income in inflation-adjusted dollars, 2000-10
Figure 17: Unemployment and underemployment rates, January 2007-April 2012
Figure 18: Consumer Sentiment Index, March 2007-April 2012
Young adults are important to non-alcoholic beverage sales
Figure 19: Population, by age, 2006-16
Race/Hispanic origin influences usage; Asians emerge as key consumer
Figure 20: Population by race and Hispanic origin, 2006-16
Health trends shape consumer restaurant beverage choices
Linking consumption of sugary non-alcoholic beverages with obesity
Figure 21: Age-adjusted prevalence of being overweight, obese, or extremely obese, among adults aged 20 or older, 1988-2010
The culprit: sugar
Figure 22: Prevalence of diagnosed and undiagnosed diabetes among adults aged 20+, by age, 2005-08
The soda tax debate
COMPETITIVE CONTEXT
Competition from alcoholic beverages
Figure 23: Alcoholic beverage ordering frequency at restaurants, January 2012
Competition from free tap water
BEVERAGE TRENDS: TYPES OF NON-ALCOHOLIC DRINK
Key points
Beverage menu trends
Soda: the beverage menu stalwart
Decline in juice beverages
Smoothies continue to grow
Figure 24: Incidence of leading types of non-alcoholic beverage on the menu, Q1 2010-Q1 2012
Smoothies command highest average price on beverage menu
Figure 25: Average price of leading types of non-alcoholic beverage on the menu, Q1 2010-Q1 2012
Trend forward
BEVERAGE TRENDS: RESTAURANT SEGMENTS
Key points
QSRs account for the largest share of beverage menu items
Figure 26: Incidence of non-alcoholic beverage items on the menu, by restaurant segment, Q1 2010-Q1 2012
Figure 27: Number of distinct restaurants**, by restaurant segment, Q1 2010-Q1 2012
Fine dining has highest average price for non-alcoholic beverages
Figure 28: Average price of non-alcoholic beverage items on the menu, by restaurant segment, Q1 2010-Q1 2012
MENU ANALYSIS: SODA
Key points
Slow growth in soda
Figure 29: Incidence of soda beverages on chain restaurant menus, Q1 2010-Q1 2012
Figure 30: Incidence of non-alcoholic beverage types on chain restaurant menus, Q1 2010-Q1 2012
A more natural approach
Soda prices rise
Figure 31: Average price of soda beverages on chain restaurant menus, Q1 2010-Q1 2012
MENU ANALYSIS: TEA
Key points
Green tea is gaining traction on restaurant beverage menus
Figure 32: incidence of leading types of tea beverage on the menu, Q1 2010-Q1 2012
Tea beverages incur modest price increase
Figure 33: Average price of leading types of tea beverage on the menu, Q1 2010-Q1 2012
Tea beverage prices exceed consumer price expectation
Figure 34: Spending on non-alcoholic beverages at restaurants, by household income, March 2012
Premium, gourmet tea is a hot trend
Figure 35: Incidence of leading marketing and nutritional claims of tea beverages on the menu, Q1 2010-Q1 2012
MENU ANALYSIS: COFFEE
Key points
Decrease in number of coffee beverages on menu
Figure 36: Incidence of leading types of coffee beverage on the menu, Q1 2010-Q1 2012
Restaurant operators pass along price increases to patrons
Figure 37: Average price of leading types of coffee beverage on the menu, Q1 2010-Q1 2012
But consumers still expect to spend less than $2 for a cup of joe
Figure 38: Spending on non-alcoholic beverages at restaurants, by gender, March 2012
Figure 39: Spending on non-alcoholic beverages at restaurants, by household income, March 2012
Figure 40: Spending on non-alcoholic beverages at restaurants, by age, March 2012
Premium, indulgence, and health are important trends
Figure 41: Incidence of leading marketing and nutritional claims of coffee beverages on the menu, Q1 2010-Q1 2012
MENU ANALYSIS: FROZEN BEVERAGES
Key points
Swift growth in smoothie beverages
Figure 42: Incidence of leading types of frozen beverage on the menu, Q1 2010-Q1 2012
High-priced frozen beverages incur modest price increase
Figure 43: Average price of leading types of frozen beverage on the menu, Q1 2010-Q1 2012
Consumers expect to pay premiums for frozen beverages
Figure 44: Spending on non-alcoholic beverages at restaurants, March 2012
Marketing frozen beverages means balancing indulgence and health
Figure 45: Incidence of leading marketing and nutritional claims of frozen beverages on the menu, Q1 2010-Q1 2012
Flavor trends support indulgence and health
Figure 46: Incidence of leading flavors of frozen beverages on the menu, Q1 2010-Q1 2012
MARKETING STRATEGIES: INDUSTRY APPLICATIONS
Overview
Television ads
Seasonal beverages
Figure 47: McDonald’s TV ad, Ice Cold, May 2012
Quality differences
Figure 48: Caribou Coffee TV ad, Fine Espresso, April-May 2012
Price value
Figure 49: Sonic TV ad, Good Idea, April 2012
Beverage brand
Figure 50: Moe’s Southwest Grill TV ad, Burrito Jam (Coca-Cola Freestyle), April 2012
Beverage platform
Figure 51: McDonald’s tv ad, Very Cool, April-May 2012
Figure 52: Dunkin’ Donuts tv ad, How You Like It?, May 2012
Digital marketing
Integrated media
Figure 53: Dunkindonuts.com home page, May 2012
Social media
EFFECTIVE MARKETING STRATEGIES: CONSUMER PERCEPTION
Key points
Coupons remain an effective marketing tool to encourage purchase
Figure 54: Effective marketing strategies, March 2012
Coupons more effective in targeting women
Figure 55: Effective marketing strategies, by gender, March 2012
Digital media appeals to younger age groups
Figure 56: Effective marketing strategies, by age, March 2012
USAGE OF NON-ALCOHOLIC BEVERAGES AT RESTAURANTS
Key points
Soda, coffee, and tea top drinks ordered at restaurants
Figure 57: Types of non-alcoholic beverage ordered from a restaurant, December 2010 and March 2012
Men are more likely to order regular soda, juice, and shakes
Figure 58: Types of non-alcoholic beverage ordered from a restaurant, by gender, March 2012
Usage of regular soda declines across age
Figure 59: Types of non-alcoholic beverage ordered from a restaurant, by age, March 2012
More affluent restaurant-goers less likely to order regular soda
Figure 60: Types of non-alcoholic beverage ordered from a restaurant, by household income, March 2012
SHIFTS IN CONSUMPTION OF NON-ALCOHOLIC BEVERAGES
Key points
Regular soda and shakes/malts are targeted for decreased consumption
Figure 61: Shifts in non-alcoholic beverage consumption at restaurants, March 2012
Reasons for drinking fewer non-alcoholic beverages
Figure 62: Reasons for drinking fewer non-alcoholic beverages from restaurants, March 2012
Elderly restaurant-goers ordering more tap water
Figure 63: Reasons for drinking fewer non-alcoholic beverages from restaurants, by age, March 2012
FREQUENCY OF NON-ALCOHOLIC BEVERAGE PURCHASE AT RESTAURANTS
Key points
Majority of consumers buy beverage with a meal
Figure 64: Frequency of non-alcoholic beverage purchases, March 2012
Men are more frequent purchasers of restaurant beverages
Figure 65: Frequency of non-alcoholic beverage purchases, by gender, March 2012
Restaurant-goers aged 25-44 are high-frequency users for beverages
Figure 66: Frequency of non-alcoholic beverage purchases, by age, March 2012
Affluent adults exhibit highest frequency of beverage purchases
Figure 67: Frequency of non-alcoholic beverage purchases, by household income, March 2012
SPENDING ON NON-ALCOHOLIC BEVERAGES AT RESTAURANTS
Key points
Restaurant prices exceed price points consumers are willing to pay
Figure 68: Spending on non-alcoholic beverages at restaurants, March 2012
ATTITUDES AND BEHAVIORS OF NON-ALCOHOLIC BEVERAGE DRINKERS
Key points
Health perceptions
Figure 69: Health perceptions, March 2012
Women are concerned about weight gain from drinking sugary beverages
Figure 70: Health perceptions, by gender, March 2012
Those aged <35 are more likely to think regular and diet soda are unhealthy
Figure 71: Health perceptions, by age, March 2012
Suggestions from wait staff are effective in reaching consumers interested in natural and low-calorie beverages
Figure 72: Effective marketing strategies, by health perceptions, March 2012
Ordering behavior
Figure 73: Ordering behavior, March 2012
Younger consumers plan to order healthier beverages at restaurants
Figure 74: Ordering behavior, by age, March 2012
More affluent are less likely to pay attention to cost of beverages
Coupons for new beverages highly effective in reaching target consumers
Figure 75: Effective marketing strategies, by ordering behavior, March 2012
Decision influencers
Figure 76: Decision influencers, March 2012
Including a beverage in combo meals and beverage brands are important to 25-44 year olds
Figure 77: Decision influencers, by age, March 2012
Promoting brands via various marketing strategies is effective
Figure 78: Effective marketing strategies, by decision influencers, March 2012
BEVERAGE CHOICES FOR KIDS
Key points
Downshift in most beverages among kids
Figure 79: Kids' beverages consumption at restaurants, December 2010 and March 2012
Beverage choice varies by age of child
Figure 80: Kids' beverages consumption at restaurants, March 2012
IMPACT OF RACE/HISPANIC ORIGIN
Key points
Asians prefer coffee and hot tea; blacks most likely to order regular soda
Figure 81: Types of non-alcoholic beverage ordered from a restaurant, by race/Hispanic origin, March 2012
Asians over index in high-frequency beverage purchases
Figure 82: Frequency of non-alcoholic beverage purchases, by race/Hispanic origin, March 2012
Asians think soda is unhealthy and most interested in natural drinks
Figure 83: Health perceptions, by race/Hispanic origin, March 2012
Asians and Hispanics interested in new beverages and health
Figure 84: Ordering behavior, by race/Hispanic origin, March 2012
Hispanics find beverage variety and combo meal with beverage important
Figure 85: Decision Influencers, by Hispanic origin, March 2012
Asians receptive to digital marketing and staff recommendations
Figure 86: Effective marketing strategies, by race/Hispanic origin, March 2012
CUSTOM GROUPS: LIGHT, MEDIUM, AND HEAVY USERS
Marketing strategies
Figure 87: Effective marketing strategies, by frequency of non-alcoholic beverage-only purchases or with a snack, March 2012
Health perceptions
Figure 88: Health perceptions by frequency of non-alcoholic beverage-only purchases or with a snack, March 2012
Ordering behavior
Figure 89: Ordering behavior by frequency of non-alcoholic beverage-only purchases or with a snack, March 2012
Decision influencers
Figure 90: Decision influencers by frequency of non-alcoholic beverage-only purchases or with a snack, March 2012
APPENDIX: CUSTOM GROUPS
Marketing strategies
Figure 91: Effective marketing strategies, by frequency of non-alcoholic beverage purchases with a meal, March 2012
Health perceptions
Figure 92: Health perceptions, by frequency of non-alcoholic beverage purchases with a meal, March 2012
Ordering behavior
Figure 93: Ordering behavior, by frequency of non-alcoholic beverage purchases with a meal, March 2012
Decision influencers
Figure 94: Decision influencers, by frequency of non-alcoholic beverage purchases with a meal, March 2012
APPENDIX: TRADE ASSOCIATIONS