Whats Happening in the Beverage Industry 2017?

Beverage Today

One of the things I like to do for fun with my extra time is keep up with food and beverage industry market trends and think of creative product ideas. By understanding market trends, you become more aware of the purchases you make and why you may be making them. Market trends often provide you with the information necessary to make an educated guess on the type of products you may find in the grocery store and a demographic of the people who buy those products. An example of this can be seen if we look at the beverage industry.

What Beverages are People Currently Buying?

Figure 1- Lists beverage products and shows the percentage of consumers that regularly drink, have tried drinking, are interested in drinking or have no interest in drinking the listed product.

According to Mintel research, the top 3 consumer interests when it comes to beverages are water, juice and hybrid beverages. But what are hybrid beverages? Hybrid beverages are drinks that combine two or more drink categories and create a new product that could fall under multiple categories. Since bottled water and juices are more or less staples in the beverage industry, we're going to zoom in on hybrid products and explore what varieties consumers want to see and who is buying them.

Who Currently Purchases Hybrid Beverages?

Figure 2- Shows consumption of hybrid drinks by percentage of people in each generation that consume them.

Millenials and iGeneration are currently pushing the growth of hybrid beverages. The exact numbers vary from place to place, but a general explanation of the generational segments are:

IGen: Born between 1996 and now
Millennials: Born between 1977 and 1995 (I just barley fit this category since I was born in 1994)
Generation X: Born between 1965 and 1976
Baby Boomers: Born between 1946 and 1964
Swing Generation: Born betewen 1946 and before

Figure 2 helps us visualize that we will most likely see new hybrid beverages marketed towards millennials and iGen more often than Gen X, Baby Boombers, or the Swing Generation because millenials and iGen are the generations buying the beverages.

What Type of Hybrids do Consumers Want to Buy?

Figure 3- Shows the percentage of consumers when asked "If you could create your own hybrid beverage, what would be the base of the drink?"

We are able to see that if consumers were able to make their own hybrid beverages they would create their own hybrid juices which may also indicate that they'd like to see more of them in the market. The top three hybrid beverages consumers would make if they could create one are : Juice (47%), water (35%), tea (34%). Figure 3 allows us to look further into the hybrid beverage space and ask ourselves "What type of attributes would consumers like to cross with the drink bases that they've chosen?".

Figure 4- Top responses when consumers were asked about the type of attributes they would like to see in hybrid drinks by percentage.

There are many different types of attributes a product can have, we see them every day. There are attributes like high in fiber, or vitamin C. There are also functional claims like "provides energy" or "caffeinated". When looking at the hybrid beverage space, according to Mintel consumers are specifically looking for Vitamins & Minerals, Antioxidants and Energy.

What Does it all Mean?

This information is great and all, but what does this all mean? Based off of all the information gathered, one can make a series of conclusions. One, it may not be surprising if the amount of hybrid drinks found in the grocery store increases during 2017. Two, look for an increase in the amount of functional claims and attributes in hybrid juices around the grocery store (you might find one you like!) and finally, millennials/iGen may be driving category growth, and hybrid beverages may be marketed towards people in that age range, but anyone no matter what age can try a new beverage product!

Thank you all for your time,
McKenzie Gary
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Title Picture is from: Pixabay.com
Figures 1-4 are from: Mintel.com and modified by me
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