By Per Sundelin
The World of Beverages is transforming in a pace not seen since the Carbonated Soft Drink (CSD) Brands conquered the way consumers across the globe refreshed and rehydrated.
We clearly see how a new reality affects all core beverage CATEGORIES. One common driver of these fundamental changes is the CONSUMERS rapidly increasing demand for Nutrition, Health and Wellness. Hence this generates new demands on the branded companies (and the increasing number of private labels) to adapt and develop their COMPETENCES accordingly.
However, the most important parameter to manage Innovations that cater to this Nutrition Newness Need is the Brands Creative and Collaborative Innovation CULTURE.
During HMT’s 10 years of service to the global beverage industry, we have worked with Global Beverage Giants, Regional Stars, Local Brands and Creative (some might say Crazy) Start-Ups. Thereby we have accumulated a quite unique insight, knowledge and experience from the World of Beverages.
Our proven Co-Innovation model, based on the proprietary FourFactors® methodology, provide a framework that makes Innovation FLOW FAST!
To highlight our HMT perspective on a selected set of the most important beverage categories, we clearly see the need for Healthy Innovations:
Brewing represents a ’mature’ category with low growth figures and a rapidly decreasing number of consolidated ’Big Food’ players. It also represents a category in transformation, where an Innovation Culture that challenge ’old truths’ and capture new opportunities is urgently needed.
The non-alcoholic beer that contains up to 0.5% per weight is identified to be the driver of growth in the European beer market up to 2020. As identified by ’Technavio’ in their recent report:
“The beer market in Europe is anticipated to grow at a steady rate and will post a CAGR of more than 1% during the forecast period. The increasing demand for low or no-alcohol beer among European consumers will drive the growth prospects for the beer market in Europe in the forthcoming years.”
HMT has recently worked with Global and local beer brands to understand and capture the accelerating NAB trends, to develop Growth Platforms and refine Innovation Concepts.
China is rapidly gaining ground to overtake U.S. as the worlds largest Dairy market, as Euromonitor recently concluded. Many recall the iconic ‘Got Milk?’ campaign from the Californian Milk Processor Board, as a main tool to regain a Cool image for Milk in U.S. What’s next in the U.S.?
The answer is to Go All-In with Price Premium positioned milk based on quality and nutrition, as Coca Cola’s ‘Fairlife’ brand did when launched in 2015. With a 50% price premium, the justification comes in form of filtered, high-protein, low-sugar, lactose-free designer milk.
“In sparkling soft drinks, mid single-digit volumes growth in Fanta and Sprite, as well as a low single-digit increase for Coca-Cola Zero, was offset by a mid single-digit decrease for Diet Coke. In juice, dairy, and plant-based beverages, Fairlife ultra-filtered milk saw its volumes leap by just over 50%.”
HMT has worked with a number of beverage companies, spanning across ‘mature’ as well as growth markets, to identify needed Strategic Growth Platforms, Creative Concept Ideas and required Activation Strategies to dare to enter new Categories.
Does Milk need to take the tour through the Cow, or can there be other ways ahead?
Globally, the plant-based milk market is expected to reach USD 16.3 billion in 2018, up from USD 7.4 billion in 2010, as stated by Innova Market Insights.
Food giants are slowly understanding what is happening; which is for example manifested by Danone’s acquisition of White Wave in 2016 and the announcement by China’s leading food processor Want Want, that it too will expand into the plant-based beverage market.
Almond milk, soy milk, coconut milk, hemp milk, cashew milk… Or should it even be called ’Milk’? At HMT we see the most important element to understand how the Consumers see and judge the Category, and how these different Ingredients provide Solutions that are valued in a obvisously changing way.
HMT has work with Plant-based explorers to understand how the Consumers think and act and how a winning plant-based brand should act to capture this rapidly growing opportunity.
The traditional 100% Juice, Nectars and Still Drink solutions are facing a rapidly growing hesitation from consumers across the globe. This leading not only to slower growth rates in the category, but in many cases declining businesses.
The Sugar content is a fundamental force in this transformation, however changing lifestyles such as breakfast on-the-go and single-households also add to the challenges. The solution? Dilute the issue and Dive into the Water!
The figures speaks for themselves: The global bottled water market is expected to reach approximately USD 280.0 billion by 2020, compared with approximately USD 170.0 billion in 2014. This means growth at a CAGR of around 8.5% between 2015 and 2020, as stated by Zion Market Research in their report ’Bottled Water Market’.
HMT has worked with juice brands across the globe; develop New ideas, Accelerate existing brands and Rescue declining businesses. The FourFactors® methodology has proven how to find Innovation Solutions. This both within the Brand Owning company as well as in Collaborative Innovation with Strategic Suppliers turning into Innovation Partners.
During September you will meet HMT at Vitafoods Asia in Singapore, DrinkTec in Munich, High Value Nutrition in Auckland and Supply Side West in Las Vegas. During these events we will not only provide keynote speeches and display our FourFactors® methodology. We will also capture the latest Beverage trends across America, Asia and Europe.
Let us know if you want to tap into our observations and reflections?
Per Sundelin @ per@theHMT.com
Peter Wennström @ peter@theHMT.com
Lesley Stevenson @ Lesley@theHTM.com
Amanda Allvin @ Amanda@theHMT.com
HMT – Global Brand Strategy Consultants for the Nutrition Industry
 This workflow follow our step-by-step journey where we Discover, Co-Create, Crystalize and Activate Innovations. How do you drive Innovation for your brands? Connect with Per@thehmt.com to discuss your innovation strategy.