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Cordials and Squashes - UK - October 2011

INTRODUCTION
Definition
Excluded
Abbreviations
EXECUTIVE SUMMARY
The market
Figure 1: Market size and forecast for value sales for the UK total cordials/squash market, 2006-16
Market factors
Figure 2: Statements about shopping habits, 2007-11
Companies, brands and innovation
Figure 3: Market share in value sales for the squash/cordials take-home market, 2010
The consumer
Figure 4: Penetration of squash/cordial purchasing, by type, over the past six months, July 2011
Figure 5: Factors most important to people when buying one squash/cordial brand over another, July 2011
What we think
ISSUES IN THE MARKET
Is the market over-reliant on a weak economy?
Is this an investable market for UK soft drink companies?
Has the industry segmented itself in a way which will maximise profits?
Is the industry missing out on potential revenue from older consumers?
FUTURE OPPORTUNITIES
Make it mine
Transumers
INTERNAL MARKET ENVIRONMENT
Key points
Prioritising value at the expense of other factors
Health takes a back seat to price
Figure 6: Agreement with selected lifestyle statements, 2007-11
Brands have a greater need to justify their worth
The rise of low calorie soft drinks
Figure 7: Proportion of cordials/squash drinkers who drink sugar-free variants most often, 2007-11
Squash/cordials rely on a summer seasonal uplift
Figure 8: Trends for quarterly penetration of cordials/squash in past 12 months, 2006-10
British provenance becomes a big selling point
BROADER MARKET ENVIRONMENT
Key points
Economic growth is sluggish…
Figure 9: The change in UK GDP at constant prices, Q1 2007-Q2 2011
... and consumer incomes are dramatically squeezed
Figure 10: Year-on-year % change in average weekly earnings compared to inflation in the UK, January 2008-June 2011
Inflation hits soft drink prices at the worst possible time
Figure 11: Trends in annual inflation per quarter (measured in RPI) for soft drinks compared to all items, 2009 Q1 – 2011 Q2
Changes in the UK social structure
Figure 12: Forecast adult population trends, by socio-economic group, 2006-16
Ageing population poses a challenge for the category
Figure 13: Forecast adult population trends, by lifestage, 2006-16
COMPETITIVE CONTEXT
Key points
The decline in alcohol drinking opens up opportunities
Figure 14: Sales of major UK drinks categories, 2006-10
Energy drinks are the big winners as soft drink competition intensifies
Figure 15: Drink types consumed in the past 12 months, 2007-11
STRENGTHS AND WEAKNESSES IN THE MARKET
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
2011 sees double concentrate innovation take off
Figure 16: The proportion of new product developments in the cordial/squash market which are double concentrate, January 2008-September 2011
Natural and ethical claims are driving force behind NPD
Figure 17: Top claims for new product developments in the Cordial/squash market January 2007-August 2011
Orange replaces apple as top flavour in NPD in 2011
Figure 18: New product developments in the cordial/squash market, by Flavour Component, January 2007-August 2011
Smaller players experiment with off piste flavours
Winter warmers
MARKET SIZE AND SEGMENTATION
Key points
Market builds towards the billion-pound mark
Figure 19: Market size and forecast for the total UK cordials/squash market, in volume and value sales. 2006-16
Figure 20: Market size and forecast for value sales for the UK total cordials/squash market, 2006-16
Take home remains the engine of growth
Figure 21: Volume and value sales for the UK take-home cordials/squash market, 2006-16
On-premise can capitalise on changing nature of the pub market
Figure 22: Volume and value sales for the UK on-premise cordials/squash market, 2006-16
Forecast methodology
MARKET SHARE
Key points
Robinsons’ dominance of the market continues
Figure 23: Trends for market share of the top 10 leading squash/cordial brands in the take-home channel, 2008-10
Own-label’s large slice of the market is eroding
… but value brands perform well
bottlegreen shows the potential for a more premium segment
COMPANIES AND PRODUCTS
Key points
Belvoir Fruit Farms
Background
Product range
Recent activity
bottlegreen/SHS
Background
Product range
Recent activity
Britvic
Background
Product range
Recent activity
Coca-Cola Enterprises (CCE)
Background
Product range
GlaxoSmithKline
Background
Product range
Recent activity
Nichols
Background
Product range
Recent activity
Princes
Background
Product range
Recent activity
CHANNELS TO MARKET
Key points
Multiples strengthen their hold on the market
Figure 24: Value sales for cordials/squash, by channel, 2009-10
The on-premise market benefits from shift in pub focus
BRAND RESEARCH
Brand map
Figure 25: Attitudes towards and usage of cordial and squash brands, August 2011
Brand attitudes
Figure 26: Attitudes, by cordial and squash brand, August 2011
Brand personality
Figure 27: Cordial and squash brand personality – macro image, August 2011
Figure 28: Cordial and squash brand personality – micro image, August 2011
Correspondence analysis
Brand experience
Figure 29: Cordial and squash brand usage, August 2011
Figure 30: Satisfaction with various cordial and squash brands, August 2011
Figure 31: Consideration of cordial and squash brands, August 2011
Figure 32: Consumer perceptions of current cordial and squash brand performance, August 2011
Figure 33: Cordial and squash brand recommendation – Net Promoter Score, August 2011
Brand index
Figure 34: Cordial and squash brand index, August 2011
Figure 35: Cordial and squash brand index vs. recommendation, August 2011
Target group analysis
Figure 36: Target groups, August 2011
Figure 37: Cordial and squash brand usage, by target groups, August 2011
Group One – Conformists
Group Two – Simply the Best
Group Three – Shelf Stalkers
Group Four – Habitual Shoppers
Group Five – Individualists
BRAND COMMUNICATION AND PROMOTION
Key points
Annual advertising spend rising steadily
Figure 38: Topline advertisement spend in the UK Squashes and Cordials market, 2006/07-2010/11*
Britvic invests heavily behind its new double concentrate
Figure 39: Above-the-line advertising spend in the UK Squashes and Cordials market, by brand, 2008-11*
Return of the Ribena berries helps push vitamin C message to mums
CONSUMER USAGE
Key points
Consumers are drinking cordials/squash with increasing frequency…
Figure 40: Frequency of usage of cordials/squashes, 2007-11
Double concentrate proves a major success
Figure 41: Penetration of squash/cordial purchasing, by type, over the past six months, July 2011
Premium ranges have potential to unlock usage among the over-45s
Figure 42: Factors worth paying more for in a soft drink, by demographics, December 2009
16-24s are comfortably the most regular consumers of squash/cordials
Figure 43: Overall squash/cordial purchasing, by gender and age group, July 2011
Figure 44: Average number of monthly occasions for drinking squash/cordials, by gender, age group and socio-economic group, 2011
As kids fly the nest so squash/cordial purchasing diminishes
Figure 45: Index of who people purchase squash/cordials for, by age, gender and presence of children in the household, July 2011
A product that needs to address the needs of the whole family
Figure 46: Who buyers of cordial/squash purchase the product for, July 2011
CONSUMER PURCHASE DRIVERS FOR SQUASH/CORDIALS
Key points
Flavour is key to purchase decisions
Figure 47: Factors most important to people when buying one squash/cordial brand over another, July 2011
Consumers pay attention to detail over ingredients
Brands attract families
Figure 48: Factors most important to people when buying one squash/cordial brand over another, for drinkers of squash/cordials with children, compared to drinkers without, July 2011
Double concentrate is a threat to manufacturer brands
Figure 49: Factors most important to people when buying one squash/cordial brand over another, for all drinkers of squash/cordials compared to drinkers of double concentrate, July 2011
CONSUMER ATTITUDES TOWARDS SQUASH/CORDIALS
Key points
Plenty of positives to shout about
Figure 50: Attitudes towards squash/cordial, July 2011
The importance of being in control
16-24s more likely to perceive mixing as a “hassle factor”
Families perceive squash as more good than bad for their family’s health
Figure 51: Net difference in attitudes towards squash/cordial, people with and without children (aged under 16) in their household, July 2011
Over-45s perceive health as more of a barrier
Figure 52: Net difference in attitudes to squash/cordial, over-45s versus under-45s, July 2011
Opportunities in polarising the market rather than claiming middle ground
APPENDIX – INTERNAL MARKET ENVIRONMENT
Figure 53: Agreement with selected lifestyle statements, by demographics, 2011
APPENDIX – BROADER MARKET ENVIRONMENT
Figure 54: PDI and consumer expenditure, at current and constant 2006 prices, 2006-16
Figure 55: Population trends and projections, 2006-16
APPENDIX – BRAND RESEARCH
Figure 56: Brand usage, August 2011
Figure 57: Brand commitment, August 2011
Figure 58: Brand momentum, August 2011
Figure 59: Brand diversity, August 2011
Figure 60: Brand satisfaction, August 2011
Figure 61: Brand recommendation, August 2011
Figure 62: brand attitudes, August 2011
Figure 63: Brand image – micro image, August 2011
Figure 64: Brand image – micro image, August 2011
Figure 65: Profile of target groups, by demographic, August 2011
Figure 66: Psychographic segmentation, by target groups, August 2011
Figure 67: Brand usage, by target group, August 2011
Brand index
Figure 68: Brand index, August 2011
APPENDIX – BRAND COMMUNICATION AND PROMOTION
Figure 69: Advertisement expenditure in the UK squashes and cordials market, by company, 2008-11*
APPENDIX – CONSUMER USAGE
Figure 70: Most popular types of cordials/squash bought in the past 6 months, by demographics, July 2011
Figure 71: Next most popular types of cordials/squash bought in the past 6 months, by demographics, July 2011
Figure 72: Who consumers bought squash/cordial for in the past six months, by demographics, July 2011
APPENDIX – CONSUMER PURCHASE DRIVERS FOR SQUASH/CORDIALS
Figure 73: Most popular factors most important to people when buying one squash/cordial brand over another, by demographics, July 2011
Figure 74: Next most popular factors most important to people when buying one squash/cordial brand over another, by demographics, July 2011
Figure 75: Other factors most important to people when buying one squash/cordial brand over another, by demographics, July 2011
APPENDIX – CONSUMER ATTITUDES TOWARDS SQUASH/CORDIALS
Figure 76: Most popular attitudes towards squash/cordial, by demographics, July 2011
Figure 77: Next most popular attitudes towards squash/cordial, by demographics, July 2011
Figure 78: Attitudes towards squash/cordial, July 2011

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