It’s set to be an unusual summer, but one that will offer more than its fair share of opportunities for retailers to grow their summer drinks sales.
These are interesting times we’re living in, and it looks likely that the normal rules might not apply when it comes to ranging and merchandising in the vital summer drinks category.
“This year, standard summer trends go out the window given the impact of coronavirus,” admits Matt Gouldsmith, Channel Director for Wholesale at Lucozade Ribena Suntory. “What’s most important now is that retailers pay close attention to the needs of their shoppers’ and adapt their soft drinks range accordingly.”
This is particularly true when it comes to drink-later formats, which are growing by 8% with multi-packs driving growth of 9.4% as the nation continues to spend more time at home than they’ve done in their lives.
“Our portfolio replicates this trend,” says Gouldsmith. “We’ve seen strong growth of 18.3% in Lucozade Energy’s drink-later portfolio, including 1L bottles and multipacks. In fact, the top three 1L SKUs represent 21% of the brand’s total sales, meaning it’s increasingly important retailers have a larger format offering in-store for this demand.”
Despite this not being a typical summer, hydration in the warm weather remains important, with soft drink sales typically increasing by +1.6% for every 1-degree temperature change. This makes it hugely important for Scottish retailers to have drink-later soft drinks ranges ready for consumers enjoying the warmer weather in their gardens or as part of picnics.
Another key trend that looks set to continue, despite Covid-19, is the growth of lower-sugar drinks. The right range will drive sales from those looking for these options.
Gouldsmith again: “This means retailers should ensure their chillers are stocked up on lower-sugar soft drinks such as Ribena Light and Lucozade Zero – now worth a combined £53.4m – to capitalise on the ongoing trend towards lower-sugar choices.”
Flavours is another strong area of growth for the soft drinks category.
“The Lucozade Energy flavours range has already contributed a significant £66.8m worth of sales to the energy segment, showing just how important it is for retailers to offer a diverse selection of flavours,” comments Gouldsmith. “Lucozade Energy is growing +8.3%, driven by flavours which are in growth of +42% year on year. On top of this, 23.8% of Lucozade Energy drink-later shoppers only buy flavours, showing how stocking a full range of flavours and formats can help retailers maximise sales. Two of the brand’s latest launches, Lucozade Energy Apple Blast and Lucozade Energy Watermelon and Strawberry Cooler, have been highly successful and they are now worth over £22m combined.”
NPD is a key opportunity for retailers with consumers invariably keen to try new and exciting products, particularly from brands they know and love. “In terms of growth drivers, it’s important to remember shoppers want excitement when looking for a soft drink,” says Gouldsmith. “We are investing in ambitious innovations across our portfolio of leading brands to drive sales for retailers this summer and beyond.
“Ribena is bringing a ray of sunshine to chillers with the launch of a brand-new drink – Ribena Raspberry Rays. The thirst-quenching new flavour, rich in Vitamin C, is ideal for shoppers looking for a burst of summer sunshine from their soft drink. Available in 500ml bottles made from 100% recycled plastic, the new launch is sure to be a hit.”
Ribena worked with a group of leading retailers to design supporting in-store POS materials and to hear their views on the drink ahead of its launch.
“This year the UK’s biggest sport & energy drink brand, Lucozade, unveiled the launch of a new sub-brand to bring new shoppers to the energy category,” says Gouldsmith. “Sweetened with stevia, and with 4.3g sugar per 100ml, Lucozade Revive is designed to offer a different type of energy. It’s not a boost or a buzz, it’s a naturally inspired uplift that makes drinkers feel revitalised and back in the groove. Revive has natural fruit flavours, no artificial colours, and vitamins B3, B5, B6 and B12 to help reduce tiredness.”
Lucozade Energy has also introduced a cool new addition to its £66.8m flavours range ahead of the summer season. Lucozade Energy Citrus Chill, a new lemon & lime flavour, is available in 380ml PMP and standard packs.
Meanwhile, Lucozade Sport has launched a ‘Keep Us Moving’ initiative to support the nation’s fitness coaches, instructors and personal trainers by incentivising them to help the nation to stay active during the coronavirus outbreak.
The initiative gives fitness experts across the country the opportunity to host online classes through Lucozade Sport’s Instagram TV channel and YouTube channel. The classes are available for free and all trainers are paid for each piece of content used by the channel in return for their expertise, with an initial £100,000 fund up for grabs.
Also encouraging shoppers to take a positive approach during the pandemic is Diet Coke which has unveiled a new ‘Give Yourself a Diet Coke Break’ campaign. The campaign is inviting people to take a moment to refresh and be kind to themselves with a little break.
Launched at the end of last month, the first phase of the campaign will run for five weeks and feature on TV, radio and social media with out-of-home advertising and on-pack activity set to follow later in the year.
Simon Harrison, Vice President, Commercial Development at Coca-Cola European Partners GB, said: “Since the country went into lockdown, we’ve seen people and communities selflessly go above and beyond to support others. As we begin to see what the new normal might look like and begin the road to recovery, the new Diet Coke campaign aims to remind consumers to take a step back and have a break for themselves.”
The new marketing campaign follows the recent launch of Diet Coke’s reduced recommended price points for its range of price-marked packs as the brand continues to evolve and adapt to current consumer demands.
With many households taking a hit on income at this time and to tap into consumer appetite of value for money, 1.75l bottles of Diet Coke are now available in a £1.75 PMP and Diet Coke Sublime Lime and Diet Coke Twisted Strawberry 500ml bottles are available in a £1 PMP.
The recommended prices on Diet Coke PMPs are intended only as a guide for retailers, and they are free to set prices as they wish. Plain packs are also available.
Tapping into water
The water category is another vital element of the wider soft drinks summer success story. Adrian Troy, Marketing Director at Barr Soft Drinks, comments: “Scotland’s £239m convenience soft drinks category continues to be one of the most profitable categories for retailers during the summer months. Summer is key to the entire soft drinks market and retailers need to ensure that their fixture is balanced to reflect seasonal category uplifts in order to generate maximum profits.
“From June to August – the crucial period for soft drinks sales – shoppers purchase 15% more soft drinks than any other time of the year, with water, fruit drinks and other flavoured carbonates seeing the most benefit.
“As the trend of health continues to grow and evolve, so does the range of products that are available to shoppers. However taste remains the number one reason for shoppers to choose a soft drink and it is essential that retailers offer a wide choice of flavours to satisfy their many different needs.
“Water is a key category within the summer chiller, showing the biggest uplift at +34%.”
Troy advises that, while it is important for retailers to offer trusted, quality plain water brands such as Strathmore, they also need to consider the growing number of consumers who are looking for healthier options, but are not prepared to compromise on taste. “Brands such as Rubicon Spring are the high taste, low calorie alternative that shoppers are increasingly on the lookout for – a bridge between the healthiness of water and the taste of carbonates and fruit drinks,” says Troy.
“Fruit drinks is the second biggest growth area in the summer, growing at +19%, as shoppers look for thirst-quenching, fruity flavours. An improved fruitier tasting recipe has been introduced on the Rubicon Stills range, delivering a much better taste while remaining below the sugar levy. Rubicon continues to use the finest ingredients, handpicked from across the globe and the improved taste will be flashed on the front of packs to generate trial.”
The third biggest growth area in the summer is flavoured carbonates, seeing a +15% uplift.
Carbonates remain the backbone of the fixture, worth £213m and accounting for 67% of the Scottish convenience soft drinks category. It is one of the most important categories for retailers to get right and shoppers are looking for a good range of great-tasting choices.
Troy concludes: “Flavoured carbonates provide choice for shoppers and Irn-Bru is a must-stock product for all retailers. Irn-Bru Xtra, delivering extra Irn-Bru taste with zero sugar, has delivered £13m of sales for Scottish retailers this year and offers choice within the fast-growing low-calorie carbonates sector.”
Red Bull, the UK’s number one energy drink brand, has also brought a new taste to the market with Red Bull Zero.
The new Red Bull Zero formula delivers a similar taste to the classic Red Bull Energy Drink but contains no sugars, giving consumers the choice to enjoy a zero-sugar product with a different taste than Red Bull Sugarfree, but the same uplift.
Demonstrating its understanding of consumer needs and attitudes, the reformulated Red Bull Zero offers shoppers more choice for those moments where they’d rather have less sugar. Alongside diet offerings experiencing growth, Zero variants are growing +20.7% displaying growing demand for zero calorie options.
Red Bull Energy Drink 250ml is, of course, a must-stock SKU as it’s the single most valuable soft drink in the UK. Red Bull Energy Drink 250ml is worth over £150m to the category and the number one single serve soft drink in the UK.