Beverage Industry Stays Ahead of Evolving Customer Tastes

Wells Fargo shares insights on the beverage industry.

Wells Fargo recently attended Beverage Digest’s “Market Smarts” Conference in New York City and shared the future outlook for beverages.

“We continue to believe that the beverage industry has many opportunities (and challenges), but believe the overall outlook for the industry’s leaders remains favorable,” said Wells Fargo Senior Analyst Bonnie Herzog.

Key themes from this year’s conference, as outlined by Wells Fargo included:

(1) authenticity, relevancy, taste, and functional attributes remain key traits of successful brands, both old and new;

(2) manufacturers continue to raise the bar to leverage consumer and retail insights and are increasingly making efforts to stay ahead of evolving consumer tastes;

(3) the shift to lower sugar content in beverages is driven as much by consumers’ evolving taste preferences as they desire to be healthier as it is by the threat of sugar taxes; and

(4) distribution is the largest barrier to entry for new brands but a key competitive advantage of the major incumbents.

“Bottom line—we remain encouraged by the health of the beverage industry and believe manufacturers are doing a good job of adapting to stay ahead of the evolving retail landscape and consumer preferences,” Herzog said.

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