The outlook for the global soft drinks industry has been downgraded in recent weeks, as Euromonitor’s soft drinks forecast model underscores the volume impact of higher pricing in Europe and North America. This report explores the latest findings of the forecast model and developments relevant to non-alcohol categories this year.
This report comes in PPT.
Euromonitor International’s Forecast Model revised full-year 2023 growth down from 2% volume growth across 54 forecast model markets (expected in November 2023) to 1.8% in the May 2024 update. Weaker volume performance for non-alcoholic drinks in North America and Western Europe was the main contributor to diminished industry growth, while the emerging market mid-term outlook remains largely unchanged.
In North America and Western Europe, the industry is still seeing substantial increases in value sales in current terms, while volume sales growth is well below historical averages. This pattern has been consistent over the past year, with a delayed but significant response by consumers to higher prices in 2024. Moderating inflation provides little relief, underscoring the imperative of affordable and profitable developed market beverage options in the brand portfolio.
The long-term (5+ year) strategic reality of the global non-alcoholic beverage industry aligns closer with the best short-term (1+ year) strategy to reignite volume: in both cases, growing share and reaching more consumers in emerging markets of Sub-Saharan Africa, the Middle East and Latin America will be essential, while business in high per capita developed Europe and North America remains driven by premium offer and price/package mix.
A relatively slow half-year for product innovation has been characterised by improved private label offering and entry-level single-serve packaging units in lower-income markets (particularly India). A weak environment for private funding has also slowed the number of independent, high-end beverage introductions. Small-scale flavour introductions and online-exclusive limited-time offers have been a theme of category launches in the first half of the year.
This is the aggregation of the following categories; Carbonates, Fruit/vegetable juice, Bottled water, Functional drinks, Concentrates, RTD tea, RTD coffee and Asian speciality drinks.
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