In total ad spend amongst carbonate soft drinks brands surged to a four-year high of £36.4m in 2013, driven by seven of the top 10 brands upping their outlay by more than 25 per cent year on year, according to Mintel. However, the increase in spend has not been enough to arrest a decline in the consumption of fizzy drinks.
Mintel research released this week found that one in four (25%) consumers are drinking fewer carbonated soft drinks than they were six months ago and half of those are doing so because they believe the products contain too much sugar.
The research house predicts this attitude towards fizzy drinks will translate into a consumption decline, forecasting value sales in the sector to reach just £7.5bn by the end of 2014, compared with £8.3bn in 2011. The volume consumed will decline to 5.95 billion litres in 2014, down from 6.17 billion litres in 2011, according to Mintel’s estimates.
The sector has come under particular pressure over the past year from health group campaigners such as Action for Sugar which has stepped up its PR campaign against the industry. Around in six (16 per cent) consumers Mintel polled also said they are drinking fewer fizzy drinks due to health campaigns such as Change4Life, which this year highlighted that there are 52 sugar cubes in a two-litre bottle of fizzy drink. This month the Government itself said the push led to an 8 per cent drop in sales of fizzy drinks high in sugar in the five months to May.
Richard Ford, Mintel senior food and drinks analyst, says there is hope in sight for carbonated drinks marketers looking to inject fizz back into their sales in the coming months – but he adds the industry will have to put its differences aside and work together to promote the benefits of no and low-sugar products and new natural sweeteners such as plant-based Stevia, which Coca-Cola’s new lower calorie variant Coca-Cola Life will contain when it launches this September.
He adds: “The carbonate soft drinks sector is a huge market with high penetration, so overall things are still good, but it’s going through a bit of a transitional stage at the moment.
“We have seen cross-industry approaches from other sectors, like the ‘Let There Be Beer’ campaign, which shows it is possible for several large companies and operators to come together to market one important message. I don’t see any reason why [the soft drinks sector] would be any different as they are all aiming for a common goal.”
A number of leading industry players including Coca-Cola Enterprises, Vimto owner Nichols and leading European bottler Refresco UK also called for the sector to work more collaboratively and proactively to promote the good work it does in areas including nutrition through marketing and PR at last year’s annual Zenith UK Soft Drinks Industry conference. But a cross-industry campaign has yet to materialise.
Coca-Cola in particular has been leading the charge on an individual brand basis, in March launching a £20m anti-obesity marketing drive with its Coke Zero variant at the heart of the push.
Gavin Partington, chief executive of the British Soft Drinks Association, says above the line ad spend across the sector for low and no calorie drinks is expected to increase 49 per cent in 2014 but it is important the industry increasingly communicates the benefits of such products “in simple and straightforward ways”.
“There’s no doubt that there’s a general trend towards consumers looking for lower or no calorie options inside and outside the carbonates sector. That’s why we’re seeing more new product development, smarter packaging and reformulation geared towards the health conscious consumer.”
Partington also points out that in their most recent financial quarters Britvic, Coca-Cola Europe and AG Barr have all credited carbonated drinks for boosting sales, adding that what consumers say in surveys and how they behave in-store can often differ.