Who is in charge of the ups and downs of the beverage market? The 2018 functional beverage competition barrage has also been opened
(1)Euromonitor Euromonitor Information Consulting
Compiled by: Monica Cui
(2) Food traders
Looking at the long-term growth trend of soft drinks globally, the low-sugar carbonated category has performed very poorly. The main reason is the decline in sales of this category in the North American market. It is understood that almost everyone's consumption of low-calorie carbonated drinks has decreased, and this category is very weak. As consumers become more inclined to choose healthier and lighter drinks, low-sugar and sugar-free carbonated drinks are gradually declining.
A craving for natural ingredients, as well as a distrust of artificial sweeteners, have been blamed for the lackluster performance of low-sugar carbonated drinks. While low-calorie carbonated drinks are struggling, low-sugar energy drinks are growing dramatically: Low-sugar energy drink brands grew steadily in 2016, outpacing all flavors of energy products.
The success of new flavors, blends and energy drinks from 2015 to 2016 is also believed to be driven by the unexpectedly strong production increase of low-sugar energy drinks (8% in 2016).
Global Energy Drink Production Growth 2005-2016
Avoid the embarrassment of artificial raw materials
The negative topic of artificial sweeteners and the harm it brings to major cola manufacturers have brought many negative effects on the development of traditional carbonated beverages, but these negative effects have not yet appeared in low-sugar energy products. Low-calorie or no-calorie product claims have forced cola producers to constantly justify and defend the use of aspartame sugar substitutes, rebrand by vigorously reformulating their products (the failed low-calorie Pepsi was converted to sucralose in the United States), and introduce new natural sweetener alternatives, such as Coca-Cola's stevia.
In the process of reducing the amount of sugar in low-sugar energy drinks, it is inevitable to use artificial sweeteners. In the United States, the Red Bull Sugar Free drink is a sweetened product of aspartame sugar substitute/potassium acesultone, while the Monster Energy Drink is ZeroUltra a mixture containing erythritol/sucralose. Both brands realized strong cash in 2016.
Why are consumers not disturbed? The product positioning of Kongfirst has distracted people from the artificial ingredients in functional drinks. Although consumers of energy drinks are also clearly looking for less sugar products, as the products themselves suggest, people are more looking forward to the core functions of energy drinks-power and excitement, so other ingredients are put in a secondary position after caffeine.
The core consumers of low-calorie energy drinks are also one of the reasons why they are not negatively affected by artificial ingredients. Whether it is the loyal consumers who strive to surpass energy drinks, or the less male brand positioning, it determines the core consumer group of the functional category-the global young male consumer group. Whether to use natural ingredients is not the focus of this group.
A taste of creativity
Another reason for the success of low-calorie categories is that creative, unique flavors inspire consumers to try. Low-sugar soft drinks are increasingly expected to replace full-flavored products (Coca-Cola and Diet Coke), while new low-sugar energy drinks are mostly conquering consumers with bold flavors, for example, excluding low-calorie categories.
In 2016, Red Bull and Monster drinks were both especially aggressive in terms of packaging and taste. The purple category (acai berry flavor) and lime category launched by Red Bull last year are both currently designated low-sugar products in the United States, which means that taste and experimentation can lead consumers to low-sugar product lines.
In the UK, Rockstar from the best-selling pomegranate-flavored drink to the fastest-growing pure zero category reduced their sugar content in February last year. Coca-Cola Europe's new super bottling machine, Coca-Cola's European partner, also announced the introduction of a citrus-flavored monster energy drink in January this year to take advantage of the strong growth of the low-calorie energy category in the UK.
But will it last?
It is clear that one of the unique highlights of low sugar beverages is low calorie/low sugar, although this effect is achieved by the use of artificial sweeteners in soft drinks. However, whether it is the barrier to caffeine ingredients or the potential restrictions and regulations of marketing, developing the brand role of low-sugar products in the early market, consumers are gradually focusing on the functions provided by the ingredients, which may enable the energy category to survive the debate about sugar.
Just as the energy drink category is maturing, functional products such as enhanced and caffeinated water, juices, and brewed beverages (cold coffee or tea) are indispensable, and you will find them closer to the shelf. However, whether it is the so-called "natural" energy claims or its substitutes, the unique features of energy drinks and the core consumer groups of this category will make this category of products continue to outshine others.
Since 2017, domestic functional beverage competition has further intensified, with domestic brands including Dongpeng and Le Hu, and foreign functional beverage brands including U.S. Devil's Claw (Monster) and Thailand's Carabao also participating in the competition. According to reports, Li Ka-shing investment in functional beverage Celsius is also the layout of the Chinese mainland market.
According to the research report of China Business Industry Research Institute, it is estimated that by 2020, the retail volume of functional beverages in China will reach 15.037 billion liters, and the retail sales will reach 163.528 billion billion yuan. So, who can stand out in this smoke and become the next generation of functional drinks?
Huabin's new "war horse" response, 2018 large-scale promotion
War Horse is another energy drink Red Bull laid out during the dispute, launched in late 2016. In March 2017, "War Horse" fully launched the market promotion. Recently, "War Horse" not only introduced 310ml red canned new products, but also set a sales target of 1.5 billion yuan. Regardless of whether the contract is renewed or not, "War Horse" can rely on Huabin's mature channel network and team operation capabilities to achieve rapid growth.
Moreover, Hua Bin formulated the latest promotion strategy in early 2018-"one yuan for purchase" and "cash red envelope", which is unprecedented in scale. Nationwide, if you buy Red Bull or a war horse, you can add 1 yuan to buy one can of Red Bull vitamin functional beverage with the words "One Yuan Happy" in the pull ring or bottle cap. Among them, the deadline for Red Bull's one-dollar exchange is October 15, 2018. The number of activity boxes is 6 million, with a comprehensive winning rate of 20%. The total number of prizes is 28.8 million cans, with a total value of about RMB 0.1584 billion yuan. The deadline for the war horse billion yuan exchange is December 31, 2018. The number of activity boxes includes bottled 15.24 million boxes and canned 7 million boxes, totaling 22.24 million boxes. The comprehensive winning rate is 50%, and the total number of prizes is 0.1983 billion cans, with a total value of about RMB 1.09 billion yuan.
Buy Red Bull vitamin functional beverage promotional products nationwide, WeChat or Alipay scan the two-dimensional code inside the pull ring, and have the opportunity to get cash red packets. The deadline is December 31, 2018, with 44 million boxes of activity boxes and 0.2112 billion red envelopes, including 800 red envelopes from 1688 yuan. The overall winning rate of the activity is 20%, and the total value of the bonus is about 0.185 billion yuan.
This activity involves 50 million boxes of Red Bull, 15.24 million boxes of bottled horses and 7 million boxes of canned horses. The number of Red Bull exchanged for one dollar reached 0.227 billion cans, and the total value of prizes (red envelopes) exceeded 1.4 billion yuan.
Devil's Claw 2018 China Releases Second Product
Among many new brands, the American monster energy drink "magic claw", which has just entered the Chinese market for more than a year, is often regarded as the strongest competitor of Chinese Red Bull.
According to reports, "Magic Claw" (Monster) relies on Coca-Cola's bottling system to expand in the Chinese market. It has now entered Tianjin, Hebei, Shandong, Henan, Anhui, Zhejiang and Jiangsu, and will continue to expand its distribution in the Guangdong market.
It should be pointed out that in the international market, American Monster Beverage is Red Bull's biggest competitor. Its bold and avant-garde brand image and young packaging design, as early as the United States market, "circle fans countless". Euromonitor data show that since 2008, Monster Beverage has surpassed Red Bull and has become the number one market share of functional beverages in the United States.
On February 2, 2018, Monster Beverage CEO Rodney C. Sacks said at an investor conference in New York that a second product will be released in China later this year, which will expand shelf share and business scope in China.
Dongpeng Special Drink Speeds up Layout of National Market, Increase 40% in 2017
The dispute between China's Red Bull has given other domestic brands the opportunity to attack the city, and Dongpeng Special Drink is one of them. Moreover, among functional beverages, Dongpeng Special Drink belongs to a domestic beverage enterprise that has gained a lot, and has already crossed the 1 billion yuan Club. In the base market, Dongpeng Special Drink has an extraordinary named purchase rate.
Public information shows that the local brand Dongpeng Special Drink is speeding up the layout of the national market. In May 2017, Dongpeng Special Drink not only received an investment of 0.35 billion yuan from Jiahua Weiye, but also signed a strategic cooperation agreement with Red Bull packer Orijin.
Over the years, Dongpeng Special Drink has continued to deepen the brand connotation of "young to wake up and fight", and actively uses the Internet to carry out brand deep cultivation by seizing popular IP traffic and implanting a large number of variety network dramas.
In August 2017, Dongpeng Special Drink has achieved its annual sales target, with an annual growth rate of 40%. In the beginning of 2018, Dongpeng Special Drink launched the first shot of New Year's marketing by launching public welfare activities, releasing Spring Festival commercials and sponsoring sports and variety activities!
Dali Le Tiger Sports Title Boosts, Sales Rise
In 2013, Dali opened the road of functional drinks with "Le Hu. In the first half of 2017, Le Hu's revenue was 1.566 billion yuan, up 43.4 year on year.
In 2017, Dali strengthened the sales of Le Hu's 250ml aluminum canned products, which were popular in Shangchao and Titong channels (schools, Internet cafes, etc.) and eastern provinces. The sales proportion of canned products increased rapidly, which was the main source of Le Hu's growth in the first half of the year. In addition, Le Hu, as the official partner of the FIA F4 China Championship and the title of the Formula China Grand Prix, has further enhanced its brand reputation through a series of economic sports sponsorship.
With the expansion of Le Hu's entire market channel, Le Hu will have a new look in 2018.
Zhongwo physical energy to step up the layout of new products, expand the first and second-tier market.
As an enterprise with a history of more than ten years, Zhongwo has entered the township market with a lower price, and its channel network in the township has always been relatively strong. According to the understanding of food merchants, in 2017, Zhongwo invested a large amount of marketing efforts in the municipalities and provincial capital markets, directly promoting the breakthrough of physical energy sales in the first and second tier markets. In 2017, the market achieved steady growth, with an annual growth rate of about 20%. In 2018, five series of new products will be launched: energy drinks, water series, catering series, protein drinks series, gift box series, with dozens of new products in taste specifications, and a comprehensive layout of large circulation, supermarkets, catering and other channels.
Carabao Sports Title Boosts, Sales Rise
In April 2017, Carabao, a functional beverage tycoon from Thailand, officially entered the Chinese market for sale.
It is understood that since March 2017, Carabao has successively sponsored a number of top sports events including parkour, longboard downhill and Qiantang River surfing. Carabao has completed a series of preliminary market warm-up in China in conjunction with large-scale high-altitude sports marketing bombing and continuous terminal market pulling activities.
In order to seize the market share of functional beverages, Carabao China has instructed distributors to adopt the "three close principles of selling point and selling goods", I .e. channel expansion is close to Red Bull, so that where there is Red Bull, there is Carabao, and even small shops without Red Bull should be covered by Carabao. The market display should be close to the Red Bull standard and larger than the Red Bull display surface, and the price should also be close to Red Bull, so that consumers can enjoy real benefits, it also allows dealers to make money.
At present, Carabao has set up 24 branches in China, with a network covering 30 provinces and more than 500 cooperative distributors. Its products are quickly distributed to hypermarkets, supermarkets, convenience stores, Internet cafes and gas stations.
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