Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Asian speciality drinks; Bottled water; Carbonates; Concentrates;
Fruit/vegetable juice; Functional drinks; RTD coffee; RTD tea
Executive summary
Slower growth for the soft drinks market
Soft Drinks is showing signs of maturity in 2007. There is an increasing trend
towards healthier diet resulting the decline in popularity of carbonates and
concentrates. Demand for RTD tea, RTD coffee, sports drinks and Asian
Speciality Drinks remained high as fuelled by new product developments and
marketing activities to stimulate demand.
Value packed products boost sales volumes
Value packed soft drinks dominate supermarket/hypermarket chains in the soft
drinks market. Their large discounts attract many consumers to buy in bulk,
especially for family consumption. Conversely, individual packed soft drinks
have been decreasing; many supermarkets/hypermarkets do not even offer
individual packed soft drinks for sale. Consumers have no choice but to buy
value packed products, which results in growth in sales volume terms, but a
general drop or only marginal growth in unit prices, depending on the sector.
This strategy also shifts some consumers who do not want to buy too many of a
product at one time from supermarkets/hypermarkets to convenience stores.
Rivalry is high in the Hong Kong market
The competitive environment is very strong in the soft drinks market. Many
sectors see a very slow increase in unit prices. Some sectors even are
predicted to see a fall in unit prices, such as carbonates, with its
decreasing popularity. To fit in with the health trend, companies have
introduced numerous varieties of products to struggle for survival and growth.
Such a phenomenon will lead to a further fall in unit prices in many
categories.
Convenience stores become the platform for launching new products
Convenience stores is increasing its importance as a distribution channel,
especially for the soft drinks market. Its wide distribution and short waiting
time for payment attracts many consumers. Many wholesalers, therefore, use
this to their advantage, using convenience stores as their platform for new
product launches with an attractive introductory price. This strategy is
widely used today. Some other companies, on the other hand, offer limited
versions of a product to consumers to encourage them to buy particular goods
in order to stimulate demand.
Slightly slower growth is expected in the forecast period
Slower growth is expected in the forecast period as the volume expansion is
limited to the maturity of the population. Health concerns and convenience
continue to drive demand and marketing activities play an important role to
sustain in the increasingly competitive industry. While Carbonates and
Concentrates decline further in its demand, Euromonitor highlights the key
growing sectors to be Fruit & Vegetable Juices, Bottled Water and Functional
Drinks which are expected to witness more than 5% in terms of value CAGR in
the next five years.
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