Sector suffers as cafes and bars reopen
Beverages, like the rest of the market, faced tough growth conditions in 2021 against a background of lockdown purchasing in 2020. As a result, alcohol declined year on year as the pubs and bars reopened. Hot beverages were flat while soft drinks grew +5.6%.
Growth this year was driven by the smaller emerging sub-categories such as stimulation, iced tea and coffee. Traditional soft drinks such as carbonates, cola, and squash underperformed by comparison. We saw the same pattern with alcohol. Wine, lager and gin performed less well, while sparkling wine, vodka and whisky saw strong growth. Smirnoff for example grew by 8.5% this year with the successful launch of two new flavoured vodkas with bold packaging. This enabled them to reach more targets in the form of younger shoppers.
Although the hot beverages category was flat overall due to the decline in everyday tea and instant coffee, there was growth in fruit and herbal teas as well as ground and whole bean coffee. Lipton managed to increase penetration nearly 25% by reaching new snacking moments in the morning and afternoon.
As we move through this year, we can expect to see the impact of inflation and government intervention in the form of HFSS and the deposit return scheme pose new challenges. However, the new in-home occasions created by the persistence of some lockdown habits and consumer willingness to engage with a broader range of drinks mean that there are plenty of growth opportunities there to be seized.
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The Spanish juice brand Don Simon has seen an impressive performance in the rankings in 2021, moving up 38 places.
Brand penetration, which has grown steadily since 2019, is 9.7%. Most of this growth has come from the “My First Juice” children’s juice brand, which has focused on new targets and successfully widened Don Simon’s core shopper group, which were retirees and empty nesters, to now include young families as well.
