It’s important to stay hydrated and to stay healthy. Consumers are purchasing beverages that help them do both and that are packaged in an environmentally friendly way. The pandemic made people think more about their health, and they are looking to retailers to make better-for-you drinks available and convenient to purchase.
According to The Hartman Group’s report, “Functional Food & Beverage and Supplements 2020,” 56% of adults use functional beverages to treat or prevent a specific condition. Among the top conditions that consumers noted were hydration (34%), energy (18%), general prevention (15%) and immunity (13%). Manufacturers are responding to these demands by launching new products, accentuating their wellness benefits, and packaging them in recycled or recyclable bottles.
One area that has seen its ups and downs is juices. In August, PepsiCo announced that it had entered into an agreement to sell Tropicana, Naked and other juice brands across North America to the private equity firm PAI Partners. While news outlets, such as CNBC and The Wall Street Journal, pointed to pressure on fruit-juice sales due to consumers’ desire to decrease their sugar intake, opportunities for brands to boost sales of juice drinks abound.
Mintel notes in its U.S. Juice and Juice Drinks Market Report 2021 that the category saw an unexpected boost from the pandemic. People bought juice for at-home consumption when they were working and going to school remotely. In early 2021, 30% of category participants reported they increased their purchases of juices, and only 10% said they decreased their purchases of juices. The report identified growth opportunities for juices that have added benefits, such as prebiotics, probiotics and protein. Also, juices can highlight their inherent benefits, such as vitamin C, to prevent the mature category from returning to the sales declines it saw before the pandemic. Innovation will be crucial as will messaging about nutrition, especially to parents looking for better-for-you items for their children.
[Read More: Health-Ade rolls out prebiotic soda line]
Sustainability Still Important
For bottled water, juice or any beverage, opportunities to highlight sustainability exist. Plastic waste and recycling are factors that affect many consumers’ purchase decisions. Among the initiatives of Coca-Cola’s environmental program, World Without Waste, the company introduced a 30%-recycled-content cap for Dasani water bottles on the West Coast in 2020 and is expanding this innovation across the United States.
Baran said BlueTriton Brands has seen an increase in consumers who are seeking beverages that are packaged in ways they perceive to be more sustainable. To meet that preference, all the company’s regional spring water brands are available in bottles made with recycled PET plastic, excluding the labels and caps. Also, the bottles, labels and caps were designed to be recyclable. The brands include Poland Spring, Deer Park, Zephyrhills, Ice Mountain, Ozarka and Arrowhead.
Consumers are looking for brands that embrace sustainability and offer more recycled package options, said Voss’ Chambers. “Helping take care of our planet, especially with the revelations in the recent UN [climate change] report, is mission critical.” Voss uses 100% recycled PET bottles as part of its sustainability commitment.
Retailers Can Drive Sales
To capitalize on these demands, Chambers said retailers, especially drug retailers with a mission anchored in supporting health and wellness, should continue to expand their enhanced and functional beverage offerings. The right assortment provides consumers the opportunity to “trade in and trade up,” which in turn builds incremental sales and category growth. Trade in refers to bringing new consumers to the beverage category with new benefits, and trade up enables a higher dollar ring due to inclusion of value-added ingredients. “It is an exciting trend that should enable solid growth for years to come,” she said.
[Read More: Essentia launches higher volume box]
There are larger trends that affect consumer purchase decisions more broadly, and retailers can leverage these trends to drive sales. The pandemic made everyone search for healthful items but also easy, convenient ways to purchase them. Digital solutions such as mobile orders, scan-and-go and curbside pickup have become a trend across all channels. These provide a major area of opportunity for retailers, according to Ryan O’Connor, category leadership, drug channel, for the North America operating unit of Coca-Cola. “As consumers are increasingly seeking out digital solutions, drug channel retailers should leverage digital channels to communicate these messages and offer frictionless shopping solutions to get beverages into shoppers’ hands,” he said.
As for in-store solutions, retailers must focus on both impulse and convenience purchases. Items for immediate consumption should be within consumers’ reach in high-traffic locations throughout the store. Items for future consumption, such as for at-home, can be bundled with family-sized meal or snack solutions.
Some retailers have made significant investments to accommodate the demand for healthful beverages and other items. Dew, from Health-Ade, said certain chains have introduced new concept stores that highlight a wellness section, with signage that calls out organic or pharmacist-recommended beauty, food and skin care products. Other chains are creating stores featuring a whole health destination with self-care options. “This idea of education will become increasingly important,” Dew said. “The better a retailer can help educate the consumer on self-care, wellness or better-for-you products, the more loyalty and repeat business they will probably see.”