New York, May 28 - As families across the United States celebrated with Memorial Day picnics, the beverages they chose fell into certain trends, according to a new Rabobank podcast.
In the podcast, Rabobank Beverage Analyst and Food & Agribusiness Research and Advisory Vice President Stephen Rannekleiv, explores three main trends, and introduces two emerging trends shaping the beverage industry.
Over the past several years, the main consumer trends in the beverage industry have been: consumer concern with health and wellness, convenience and premiumization -- or trading up for affordable luxury. More recently two additional trends have emerged -- a focus on 'green' products and fragmentation -- as consumers are demanding a broader array of products. (This information begins at 0:58 in the podcast.)
"The last year we have seen a real growth in greening and sustainability, and as consumers have different levels of priorities the fifth trend has been demand fragmentation as consumers look for specific niche products for specific needs," said Rannekleiv. (This information begins at 1:20 in the podcast.)
The emerging greening trend has been seen most closely on beverage containers. "The trend has been growing since 2004, but it took root in 2007 when the number of products with 'green' or 'eco-friendly' in the label virtually doubled," Rannekleiv said. (This information begins at 5:45 in the podcast.)
The second emerging trend is one of fragmentation, which has arisen as customers' tastes and needs change. This has forced companies to create more niche products as well as increase the number of products offered to fulfill various needs. In fact, according to Rannekleiv, over the last decade, most distributors have doubled the number of products they offer. (This information begins at 6:38 in the podcast.)
The current U.S. economy could alter these trends in the beverage industry -- or even create new trends. But, said Rannekleiv, "that's the million dollar question right now; it's hard to know how deep seeded these changes are. A lot of it depends on the economy's health in the next year." (This quote begins at 7:55 in the podcast.) One of the trends that will be put to the greatest test will be the health and wellness trend as consumers decide whether to continue to pay a premium for organics and other health and wellness products.
For example, Rannekleiv said, consumers have driven the development of niche products that include anti-oxidants, super fruits being added to juices, additional teas infused into the market and soft drink companies seeing a decrease in the sale of high-calorie drinks. (This information begins at 1:59 in the podcast.) However, as consumer pocketbooks are strained by the current economy, whether consumers continue to pay premiums for these products remains to be seen.