Beverages go from bubbles to fruit, to sport and back to tea

Newsroom 14/04/2008 | 15:58

Natural juices, nectars and tea-based drinks occupy an increasingly important slice in beverage producers' portfolios and more and more companies are launching these types of products locally.
According to a report released by Euromonitor International in 2007, Coca-Cola's market share was slipping last year, but it still remained the world's leading carbonated cola. The two best known sodas split the world, with Europeans and South Americans fond of Coca-Cola, and Asians preferring Pepsi. Coke's market share of all cola sales slipped to 53 percent in 2006, from 57 percent in 2000. The battle of the two best known brands of the non-alcoholic drinks' industry is now being fought in the sports arena.
Two years after PepsiCo Romania launched locally Gatorade (slogan: “the number one sport drink in the world”) Coca-Cola reacted last week with Powerade (“drink to make the difference in sport”). The two drinks are quite similar in shape and display the same “sport cap.” Sport drinks are an industry niche still not fully covered by producers operating in Romania and are seen by analysts as an extension of the energizing drinks market.
Dragos Militaru, market manager of Coca-Cola Romania & Moldova, said that there were no niche segments where the increase is not at least “two digits” in Romania, because the entire market of carbonated and non-carbonated drinks is increasing. One of the most significant increases is in natural and still drinks, as well as tea-based drinks. According to Coca-Cola estimates. the natural juices market is expected to reach EUR 120 million in 2008, within a total of EUR 850 million of soft drinks including mineral water, according to the producers. Natural juice consumption was expected to increase by 20 percent in 2008.
A growing segment is the children's market. Tymbark Maspex Romania, part of Polish group Maspex Wadowice Polonia, saw in this a good opportunity. The producer entered the still drinks market with the Tedi brand, a marketing step in preparation since 2007 when the producer launched Tymbark juices. The company invested EUR 7 million for all its non-carbonated soft drinks in 2007 and plans to reach a turnover of EUR 60 million in 2008.
As a repeating pattern of all the latest marketing campaigns by soft drinks producers, the producers are pointing to the lack of preservatives and artificial coloring and stress the high percentage of fruit and nutrients in the drinks. For instance, Tymbark Maspex just launched an extension to the Tedi brand, Tedi Play, which introduces the aseptic technology used in the production for filling bottles.
All the producers on the still drinks market have announced increase in their business. Giampaolo Manzonetto, administrator of Parmalat Romania, which posted a fourfold increase for still drink sales in 2007, said that the juice and nectar segments will be the battleground for gaining market share for producers. The producer of Santal juices in Romania registered an EBITDA of 3.1 million in 2007 and sales of EUR 14.4 million, almost doubling the value registered in the previous year. Santal competes with brands such as Tymbark, Prigat produced by Pepsi Americas, Cappy produced by Coca-Cola HBC and Granini produced by Carlsrom. Santal registered a sales increase of almost 250 percent within Parmalat's business, especially after it launched the PET container, said Manzonetto.
A more dynamic segment, ice tea is an important source of sales results, especially in the hot season. With brands such as Nestea from Coca-Cola, Lipton Ice tea from Pepsi Americas, the newly launched Figo Ice Tea by Tymbark Maspex and Santal Ice Tea from Parmalat, the local ice tea market exceeded EUR 70 million in 2007. Dragos Militaru of Coca-Cola expects a 30 percent increase on this segment which only makes up 2 percent of the entire market of non-alcoholic drinks in Romania.
Referring to data released by research company Canadean, Militaru said that the ice tea segment was the most dynamic of all non-alcoholic beverages. Nestea was launched in 2004 in Romania, comprising two types of black tea. Coca-Cola expanded its portfolio last week with Nestea Green Tea Citrus and Nestea Vitao. According to Militaru, non-carbonated drinks make up 35 percent of Coca-Cola Romania's portfolio. “We are still attending primary school classes for this niche but we plan to develop further and maintain our market leader position on this segment,” said Militaru.

By Magda Purice

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