With limited editions galore, evolving functionality and the ability to meet multiple need states, the soft drinks sector is thriving in convenience.
By Sarah Britton
Soft drinks certainly made a splash in convenience in 2023, growing sales by 15.3% to £3.3bn, alongside volume and unit growth of 3.3% and 3.0% respectively [Circana, Total Convenience, Total Soft Drinks, Value, Vol & Unit, 52WE 31/12/2023 vs. YA].
The Britvic Soft Drinks Report 2024 states that soft drinks are the number one footfall and sales driver for convenience retail, accounting for 31% of all shopping missions and 32% of sales [Lumina Intelligence Retailer Attitudes and Behaviours Study, July 2023].
The main reason people are visiting c-stores to buy soft drinks is to satisfy the need “for a treat,” followed by the need “for a snack” [Lumina Intelligence Convenience Tracking Programme, 52WE 31.12.23]. For this reason, Britvic claims it is important for stores to ensure they offer exciting flavours and drinks that offer a wide range of need states, noting that “limited-edition flavours play a key role in generating excitement”.
Prime Hydration – the drink made famous by YouTubers KSI and Logan Paul – has caused many a commotion in recent years with its numerous limited-edition flavours. Prime accumulated sales of £55.7m in convenience in 2023 – that’s a ridiculous 9,710.7% YOY increase! [Circana Total Convenience, Total Soft Drinks, Value Growth YOY, 52WE 31.12.23]. The brand took 1.3% of soft drinks value in grocery, convenience and discounters [NielsenIQ RMS – Total Coverage Inc. Discounters, Total Soft Drinks, Value share of sales, Calendar year 2023 w/e 30.12.2023], according to the Britvic report. However, share has fallen to 0.5% since the start of 2024 [NielsenIQ RMS – Total Coverage Inc. Discounters, Total Soft Drinks, Value share of sales, Latest 12 weeks to 30.03.2024].
“Many established FMCG brands could still learn a lot from Prime about creating a buzz online with a steady flow of new products,” says Britvic, noting that seven of the top 20 soft drinks launches in 2023 were from Prime.
Daniall Nadeem of Spar Motherwell Road in Bellshill, North Lanarkshire, is very accustomed to stocking up on all the latest trends. This year alone he has stocked Cherry Freeze, Strawberry & Banana and X Prime variants. “If you’re not quick off the mark you miss out on sales – it’s important to stay in touch with the market,” he says. “If you build up a reputation for being a store that stocks the latest products you’ll do well.”
Another soft drinks brand that has created a vibrant online presence is Mogu Mogu. “Like many other categories, social media and popular culture have a powerful influence over shoppers’ soft drinks choices,” says Sales & Marketing Director Ash Chadha. “Just look at energy drinks – when social media played a huge part in propelling influencer-founded brands into the market at speed, c-stores were quick to respond, unlocking mammoth sales growth in the process.
“Social media is a channel we’ve used to foster a growing, passionate fanbase for Mogu Mogu, particularly among Gen Zs and Millennials – something we’re building on by leaning into popular culture through strategic partnerships with high-profile influencers and celebrities whose audiences and their interests align with our own.”
This includes sponsorship of The Chunkz & Filly Show – a podcast by two highly successful YouTubers with massive social media followings – which has helped Mogu Mogu to get in front of its core demographic, as well as a global brand partnership with up-and-coming K-Pop group Seventeen, who recently performed on the Pyramid Stage at the Glastonbury Festival.
As well as successfully connecting with its audience, Chadha believes that his product’s originality is a big part of its draw. The quirky Japanese-inspired drink combines juice with nata de coco – coconut gel pieces – which consumers are encouraged to chew.
“Offering a multi-sensory drinking experience, our fun, unique chewy texture and line-up of refreshing fruit flavours has helped us successfully disrupt the category to become a mainstay in the drinks chiller,” he says. Mogu Mogu claims to have outpaced the success of the total category with phenomenal triple-digit growth of +216% over the past year, making it the fastest-growing soft drinks brand in 2023 [NielsenIQ Total Impulse 52 w/e 9.3.24].
Chadha claims that limited-edition seasonal launches are central to success. “Introducing limited-edition flavours, especially during peak sales periods for Soft Drinks, is always a winner when it comes to boosting volumes,” he says. “The exclusivity that comes with limited editions encourages shoppers to act on impulse and grab new launches whilst they still can. Our Bubble Gum and Candy Floss variants are a case in point here.
“Bringing unexpected, nostalgic flavours to drinks chillers has helped us to both extend appeal among soft drinks buyers and poach shoppers from other categories where these flavours are hugely popular, like confectionery.”
Limited editions have gained currency among established brands too, claims Britvic. Last year’s limited-edition Tango Sugar Free Paradise Punch, racked up sales of £4.2m in convenience after launching in February 2023, surpassing Berry Peachy, which was the biggest NPD launch of 2022.
This April, everyone was talking about Tango Blast – an RTD version of Tango Ice Blast. Despite many retailers getting frustrated with the latter’s poor service levels, consumers can’t get enough of the red and blue drink. So converting the flavours into RTD formats seems like a win all round.
The convenience store exclusive targeted Gen Z shoppers with its bold Raspberry and Cherry flavours, striking colours and eye-catching packaging.
Ben Parker, Retail Commercial Director at Britvic, says: “The demand for on-the-go soft drinks has increased, shown by the 57% of people who had purchased soft drinks saying that it was the main reason they went to their local convenience store [Lumina Intelligence Retailer Attitudes and Behaviours Study, July 2023]. In addition, 34% of shoppers will go without or elsewhere if they’re not happy with the to-go drinks available [IGD Category Benchmark research, May to June 2023].
“The category presents a huge opportunity in the channel, which is why we’re supporting it with the exclusive launch of the already popular Tango Ice Blast flavours in a ready-to-drink format.”
When asked about winning soft drinks lines, Daniall Nadeem flags up the brand as a top performer at Spar Motherwell Road, alongside Irn-Bru slush.
Irn-Bru Xtra Raspberry Ripple and Wild Berry Slush limited editions arrived on shelves in March, backed by a campaign targeting 16 to 24-year-olds.
Jonathan Kemp, Commercial Director at Barr Soft Drinks, says that the brand has already seen good results with limited editions. “Last year’s Irn-Bru Xtra limited editions were a massive success, delivering £29 million to the category as well as a 30% uplift in the core Irn-Bru Xtra variant.”
With regard to limited editions, the Britvic report says: “What’s crucial is that such products drive incremental growth and shoppers continue to buy once the novelty has worn off.”
This was certainly the case for April 2023’s Raspberry & Mango isotonic sports drink limited edition launch from Boost. The drink turned out to be a mega hit, exceeding forecasted figures by 170%, and so the firm decided to permanently incorporate the flavour into its core range. Earning sales of £1.8m, it was the second-best-performing new sports drink in the convenience channel that year [Circana, Total Convenience, Total Soft Drinks Britvic Defined, Value, 52WE 31/12/2023].
Lucozade Alert is downsizing to 250ml cans in order to grow the brand’s appeal. The new format will come in two flavours: Zero Sugar Mango Peachade and brand-new Ultimate Energy, which features guarana.
Half of stimulation drink shoppers said they’d prefer a smaller can, according to The Work Perk data, which carried out a sampling campaign questionnaire.
Aoife McGuigan, Head of Category Expansion, SBF GB&I, said: “We’re investing in the Lucozade Alert range to bring the right formats and the right flavours to market and drive even more sales for retailers this year. The research shows us there is strong demand for smaller cans in the category, with 31% of stimulation drinks now sold in 250ml cans [Nielsen Total Cov. Incl. Discounters 52wks 13.04.24]. We also know they’re especially popular with shoppers over 25 years old [Kantar data 2024], so can help retailers to unlock new shopper demographics. Our dynamic duo of 250ml cans is certainly set to be a hit with new shoppers looking for a high caffeine stimulation drink, so retailers should stock up now to see sales grow!”
Sports drinks were the winning segment in 2023 with value growth of 64.6% YOY, adding £75.3m to convenience, states Britvic [Circana, Total Convenience, Total Soft Drinks by Segment Britvic defined, Value growth YOY, 52WE 31/12/2023]. This growth rises to 69% if you home in on independents and symbols, shows the Britvic Report.
In fact, sports drinks have performed well since the pandemic, claims Suntory Beverage & Food (SBF) GB&I, which correlates with a broader increase in focus on health following the impact of Covid-19. Penetration of sport drinks grew by 66% from February 2020 to February 2022 [Kantar | Take-Home Panel | 4we Rolling Data | Soft Drink Sectors | Penetration | 10 Year Trends]. “While a lower base than stimulation, the trend within sport drinks matches the upward swing in the broader sports & energy segment,” says Matt Gouldsmith, Channel Director, Wholesale, SBF GB&I.
The top-performing NPD within sports drinks, according to the Britvic report, was Lucozade Sport Zero Sports Berry, which achieved sales of £2.2m in convenience [Circana, Total Convenience, Total Soft Drinks Britvic Defined, Value, 52WE 31/12/2023].
Sports drinks continue to perform in 2024, currently seeing 18.6% value sales growth and 17.1% volume sales growth [Nielsen, Sport, GB Total Coverage Convenience, Volume (LIT), Latest 52 weeks to 25.05.24].
Outside of sports drinks, other soft drinks categories are also benefiting from added functionality, making them more appealing and permissible.
“New consumer options – including enhanced waters, protein, gut health, meal solutions, fermented, prebiotic and probiotic drinks – are being executed in a variety of size formats to deliver excitement and respond to consumer needs while keeping the category fresh,” says Adam Hacking, Head of Beverages at Arla.
“The RTD coffee category, as it grows in scale and seeks to attract new consumers, will drive new trends, whether that be provenance, offering new taste options through limited editions, or enhanced product functionality.”
Arla has invested into the latter with its latest Starbucks launch, with the brand making its debut into protein drinks in June.
Crafted from Starbucks Arabica Coffee combined with low-fat milk and no added sugar, Starbucks Protein Drink with Coffee contains 20g protein per 330ml bottle and comes in Caffe Latte, Caramel Hazelnut and Chocolate Mocha flavours. The high-protein range adds strength to the protein category which has seen exponential growth, increasing in value from £46m in 2021 to £147m in 2024 [Nielsen 20/4/2024].
Starbucks’ consumers are some of protein’s biggest fans, claims Arla. In fact, they buy it 6.1 times per year more frequently than average protein buyers [Kantar 05/08/2023].
Britvic has also latched on to the lure of protein and coffee. When the firm entered the booming RTD Coffee market in July 2023 with the acquisition of Jimmy’s Iced Coffee, it knew exactly how to maximise the opportunity. “Since adding Jimmy’s to our portfolio, we’ve boosted the brand’s functional credentials with the addition of two new products in collaboration with Myprotein,” explains the firm.
Available in Original Iced Coffee and Caramel Iced Coffee, the co-branded Myprotein lines pack 5.6 grams of protein per 100ml and have been designed to help convenience retailers cash in on growing demand for protein-enriched drinks.
- Stimulants
- Cola
- Fruit carbs
- Plain water
- Sports drinks
Source: Britvic Soft Drinks Report 2024, Circana, Total Convenience, Total Soft Drinks by Segment Britvic Defined, Value sales, 52WE 31/12/2023
Jimmy’s Iced Coffee is also expanding its SlimCan range with a 250ml price-marked pack format. Rolling out exclusively across the convenience and impulse channel, the new format spans Jimmy’s Original, Mocha, Caramel and Strong flavours, with a £1.39 price on pack.
Britvic’s Parker says: “We know that shoppers are looking for value when it comes to choosing their next on-the-go drink, and with price-marked packs holding 34% share of sales across total impulse [Nielsen IQ RMS, 52 wks to 30.12.23, Total Impulse exc. Co-op; using AC distribution, PMP Share of Value and Assortment over Total Single] the new Jimmy’s Iced Coffee PMP format is sure to help retailers deliver on this.”
Daniall Nadeem is teaming up with Jimmy’s for some activations to propel his iced coffee sales. “We had own-brand iced coffee from Spar but it was discontinued,” he says. “We do really well with Starbucks and Costa and we’re now in partnership with Jimmy’s – we’re just waiting to hear back details of an activation. It’s still very early stages, but they’re going to come out and possibly do tastings and give out some merchandise.”
He is a fan of using price marks within his impulse categories. “In soft drinks, confectionery, crisps and snacks we try and stick to price mark,” he says. “The margin’s not insulting at that point.”
When remerchandising his store, Daniall ended up losing 1m of soft drinks space, but this enabled him to review his range and ditch slow sellers. “We realised we were holding on to dead stock and [instead] stuck to a clean planogram,” he says. Despite having less shelf space, the category continues to deliver on sales. “Soft drinks are on the up,” he concludes.
With consumers demanding variety and excitement from their soft drinks, there is a strong opportunity for challenger brands.
“Of course, soft drinks play a functional, thirst-quenching role in shoppers’ lives, but they’re also seen as a quick, easy and cost-effective way to experiment with different and exciting flavours,” says Mogu Mogu’s Ash Chadha. “This means retailers need to strike a balance between maintaining stock of the category’s big players, whilst also injecting excitement into the category through NPD from disruptive, challenger brands.
“In a category that is almost second nature given how embedded it is in the nation’s everyday routine, retailers have a unique opportunity to stop shoppers in their tracks with brands that bring something genuinely new and distinct to the category, like Mogu Mogu. This is what’s going to encourage impulse purchases, capture the attention of new shoppers and turn the dial on retailers’ sales.”
Pepsi has also been busy differentiating itself from competitors, carrying out a rebrand last March with the goal of attracting younger shoppers, whilst retaining existing customers.
Ben Parker, Britvic Retail Commercial Director in Great Britain, said: “The rebrand reflects Pepsi’s challenger mindset and drive to push culture forward whilst remaining iconic and timeless, with a new logo and visual identity that borrows equity from its past and incorporates modern elements to create a look that is unapologetically current and undeniably Pepsi. The vibrant new look will grab the attention on the shelf, playing a key role in drawing younger consumers into the category.”
