Soft drink brands must play into health trends in order to compete: GlobalData

02-Apr-2017 - Last updated on 03-Apr-2017 at 13:49 GMT

There's a bright spot for soft drinks that offer functional health benefits ©iStock/ShootOutLoud

Despite declining market share, there is hope for soft drink manufacturers who can adapt to the highly-competitive beverage market by utilizing major health trends like reduced sugar and digestive benefits, GlobalData research found.

“It is imperative that soft drinks manufacturers better utilize health trends,” Melanie Felgate, senior consumer analyst for GlobalData, said.

In its latest report, GlobalData found that 89% of consumers find general health and wellbeing claims on food and beverage products appealing and 59% of global consumers said they are influenced by how soft drinks impact their health when choosing products.

However, these findings do not mean consumers are abandoning soft drink purchases all together. Instead, most of them are taking a holistic approach to a healthy lifestyle and wellbeing, and do not want cut out soft drinks completely, GlobalData found

Consumers look for sugar reduction and gut health

Soda companies can respond to consumers seeking healthier beverages by offering products that tout digestive benefits and use “health-enhancing” natural ingredients like cinnamon, ginger, and turmeric in place of sugar.

“The sugar backlash, concerns around artificial ingredients, and a desire for a ’cleaner’ lifestyle are driving demand for beverages that are deemed ’better for you’ than regular soft drinks,” Felgate said.

“Consequently, manufacturers must reduce sugar content and offer products with functional benefits, such as promoting gut and digestive health, to appeal to consumers seeking healthier products that are still similar to traditional soft drinks.”

PepsiCo has made a play into the “next generation” of soda with the launch of IZZE Fusions, which the company describes as “sort of soda, sort of juice, sort of sparkling water” with a blend of cane sugar and stevia.

Falling in line with the gut health trend and utilization of healthy ingredients, Farmhouse Culture is launching a line of sparkling probiotic beverages sweetened with erythritol and stevia available in a variety of flavors, including lemon ginger and cherry cacao.

Additionally, labeling credentials such as logos or certifications and popular health claims like “pure” and “natural” appeal to 66% of global consumers.

“Effective targeting will help brands to remain relevant to consumers’ changing preferences and shopping habits in this highly competitive space,” said Felgate.