Strong Year for Juices and Teas

juicesteasCustomer demand for cold beverages is heating up and few categories grew as much in 2012 as juices and teas. Sales of canned and bottled teas surged 8.52% to $1.22 billion for the 52 weeks ended Dec. 31, 2012, according to SymphonyIRI.

AriZona and Lipton were the two most popular brands in convenience stores, accounting for four of the top five brands. Gold Peak, however, had the year’s strongest sales gains, according to SymphonyIRI, growing 36.77% to $84 million.
Changes in the ways Americans think and buy beverages are creating a host of opportunities for retailers who have always relied on carbonated
beverages to pay the bills.

“I would say that what began as an evolution is now really speeding up,” said Tom Pirko, managing director of BEVMARK in Buellton, Calif., a consulting firm specializing in the food and beverage industries. “There is a different paradigm forming that is playing out in convenience stores, even before it plays out in the grocery stores, the club stores and the mass marketers.”
That new paradigm consists of a recognition that the role consumers have traditionally assigned to carbonated soft drinks, and especially colas, has begun to change.

“This whole thing about obesity is really beginning to set in. People don’t view the convenience, hydration and refreshment of soft drinks the way they did, and they are thinking now very seriously about alternatives,” Pirko said. “They didn’t always weight the calorie content of juices, but they associated them with good health and being beneficial.

Delivering Value
Pirko is a believer in aggressive merchandising and promotion, comparing the category to his experience working with energy shots. “We found that there was a niche and we just drove it and opened it wide,” he said. “It’s the same thing now with these alternatives to soft drinks. Successful c-store operators, those who make the most money, are those who see the trends and the opportunities.”

Beyond negotiating better deals with suppliers, Pirko recommended aggressively marketing with juices, teas and other healthy beverage options. “Put it up so that it’s right in front of the consumer,” he said. “If we continue to have consumers looking for alternatives, you’ve got to go beyond just suggesting them; you’ve got to put options in front of them.”

Bundling juices and teas along with food items can only help stimulate sales, Pirko suggested. “The more you can put things together the more attractive you are as a stopover for the consumer who is hungry and thirsty,” he said.

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