Ready-to-drink market faces serious decline

Sales in the previously dynamic ready-to-drink (RTD) market, which includes drinks such as Bacardi Breezer, Reef and Smirnoff Ice, have dramatically declined in the past year. Insiders are now claiming the sector is in freefall and manufacturers are facing a terminal decline in sales.

According to the latest AC Nielsen figures, the popularity of most RTD brands has diminished sharply when compared with the dizzy heights RTDs reached in 2000 to 2002, when sales rocketed by 75 per cent. The figures show sales by value dropping by six per cent year on year since last June.

The sector’s decline cannot be blamed on consumers drinking less alcohol. The total alcoholic drinks market is growing steadily by 4.6 per cent.

Industry experts also say one of the main reasons for the decline is that the RTD market is bereft of any innovation that could help woo consumers back to the sector.

Unwins marketing director Ian McLernon says: “There is no real innovation in the market and only an abundance of me-too products. The sector has reached saturation point.”

Responding to the decline, Asda is launching an aggressive discount campaign to trigger interest in the market. It will soon begin to offer three four-packs for £10 on brands such as Coors-owned Reef and Halewood International’s Red Square. A spokesman for Asda says: “We are trying hard to re-invigorate the interest in this declining market.”

Earlier this year, the top- selling brand in the sector, Diageo-owned Smirnoff, also reported a 12 per cent decline in its sales.

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