Sugar is the latest food to be demonised by the health brigade. It’s addictive and damages your health, the headlines cry. Typically these stories are accompanied by a picture of a can of Coke and the amount of sugar it contains. Indeed, in a story last month on the Mail Online it said just half a can of Coke exceeds the new daily sugar guidelines. Apparently experts now recommend just three cubes a day and a 330ml can of ’red’ Coke contains seven.

Of course, there are alternatives to full-sugar Coke in the form of Diet Coke and Coke Zero as well as the new Coca-Cola Free a timely addition in light of a new report from Mintel. Its Carbonated Soft Drinks report (June 2014) found that 25% of consumers are drinking fewer carbonated drinks than six months ago, with 50% of these saying they are doing so because they contain too much sugar. What is more, one-third of those who have cut down, say they are worried about the health impacts of artificial sweeteners in these drinks. So could natural stevia be the saviour of carbonates?

Coca-Cola Enterprises (CCE) already uses stevia in Sprite and also used it in a special-edition raspberry & passion fruit Fanta earlier this year, but is now using it in its flagship brand and bringing a new colour green to its line up.

Coca-Cola Life was first launched in Argentina and Chile last year, and it made its European debut here in the UK last month. It’s a mid-calorie drink sitting between Coke and Diet Coke/Coke Zero. So its contains a third less sugar and a third fewer calories than regular Coke and is sweetened from natural sources rather than the artificial ones in Diet Coke/Zero. Those natural sources are a blend of sugar and stevia leaf extract, which gives it a calorie count of 89 in a 330ml can.

CCE expects Life to drive incremental growth in the soft drinks category by appealing to 35-55 year-old consumers who are looking for a lower-calorie cola with sweetness from natural sources.

It is available in a 330ml can, 500ml and 1.75ltr PET bottles, six x 330ml can multipack and eight x 330ml can multipack all at the same recommended retail prices as the rest of the Coca-Cola range.

CCE says that more than 40% of its cola sold in Great Britain is already no-calorie but the launch of Life gives consumers even greater choice.

Green all the way

Life’s ’green’ packaging is all the more worthy thanks to a 500ml bottle containing PlantBottle plastic made using up to 22.5% plant materials combined with up to 25% recycled plastic. All packs are fully recyclable and both the 330ml can and 1.75ltr PET contain recycled materials.

Nick Canney, vice president for sales and marketing at CCE, says: "Coca-Cola Life is a truly differentiated proposition within the portfolio, providing consumers who are looking for a great tasting lower calorie cola with sweetness from natural sources.

"Coca-Cola Life will also help to drive incremental growth of the total soft drinks category building upon our on-going strategy to bring new innovations to market. Last year CCE delivered 40% of the value generated by innovation within the category, which was worth £96m in sales to our customers (Nielsen)."

The launch of Coca-Cola Life will be backed by a marketing campaign, which includes out-of-home, print, digital and experiential activity.

Canney says: "The campaign will create instant impact and ensure consumer awareness of the brand launch is high, helping to grow sales for retailers throughout the coming months."

Although there’s understandably a big focus on Life, CCE is not neglecting its no-calorie Cokes. Indeed it has just announced the next stage of Coke Zero’s ’Just Add Zero’ campaign.

This sees the return of the distinctive ’Just Add Zero’ packaging which performed strongly in convenience stores when it first hit shelves and has contributed to a sales increase of 19.2% in independent and symbol outlets so far this year (Nielsen). The campaign explores the idea that things get ’bigger, better, faster and greater’ when you ’Just Add Zero’, in a bid to position the brand as exciting and dynamic.

Caroline Cater, operational marketing director for CCE, says: "To date, 2014 has been hugely successful for Coke Zero, and our initial activation of the ’Just Add Zero’ marketing campaign played a key role in driving increased sales, particularly in independent outlets."

CCE’s trade communications manager, Dave Turner, says many shoppers are looking for ways to maintain a healthy lifestyle, but at the same time still want to enjoy their favourite drinks, so light or diet soft drinks present a strong sales opportunity for forecourt operators. "Currently around 40% of all carbonated soft drinks sales come from light or diet variants, with sales worth over £1bn to retailers last year. This figure is growing by 2.5% and there is the potential for even further growth (Nielsen data)."

Of course, the cola sector is not the only one to embrace lower sugar drinks. August saw the launch of a reduced sugar cloudy lemonade variant of Lucozade Energy.

Delivering the same taste and functionality as the Lucozade Energy core range, it contains half the amount of sugar. Brand owner Lucozade Ribena Suntory says the new variant taps into the growing trend for reduced sugar products and presents an incremental sales opportunity for retailers. The drink will be particularly relevant to consumers in the 25-plus age group because, according to Kantar Worldpanel data, they are more conscious of their sugar and calorie intake.

Lucozade marketing director, Corrine Hopwood, says: "We have identified a brand new opportunity in the market for a reduced sugar proposition within the energy category. We recommend that Lucozade Energy reduced sugar cloudy lemonade is sited alongside the core Lucozade range to aid brand association at the fixture. With this new proposition, we are helping to retain shoppers within the energy segment."

Lucozade Energy has identified two sets of target consumers for the drink. The first is males aged 25-35 who are on the look out for on-the-go purchases and meal deals. Their needs are met by the 500ml and 380ml pack formats. The second is families with young adults, where the six x 380ml multipacks for planned purchases and the one litre for social sharing occasions are ideal. To make the most of these occasions, Hopwood says retailers can use cross-category merchandising to drive impulse purchases of the smaller formats and secondary siting of the bigger formats to tap into the more pre-planned purchases.

The launch is supported by a £1.8m spend including outdoor, online and in-store activation to drive awareness and engagement around the new reduced sugar proposition and cloudy lemonade flavour.

Meanwhile, Boost offers a sugar-free pink lemonade in a resealable 500ml bottle containing less than 10 calories and a 250ml can with just five calories. The company reports that since its launch, Boost’s total sugar free sales have gone through the roof, up by 70% (Boost volume sales MAT August 2014).

According to Nielsen, sales of low-calorie energy drinks rose to £72.6m in the past year, amounting to a 19% increase, nearly three times the 6.6% rate of value growth of regular versions. "This indicates a growing desire from shoppers for low and no calorie variants, and this looks set to continue going forward," says CCE’s Turner.

"Our two energy brands have responded to the growing demand for light options by rebranding their sugar-free offerings, with Monster absolute zero and Relentless origin ultra both repackaged to increase their appeal."

Ready for winter

After a successful summer for soft drinks thanks to warmer weather, Turner reckons winter presents an opportunity for forecourt operators to refresh their soft drinks range, especially during the Christmas season when soft drinks sees the second biggest penetration of any food and drink category (Kantar Worldpanel data).

"Christmas represents a big opportunity for forecourt traders to capitalise on products which are traditionally popular during the festive season, and it’s important to provide the best selection to fully reach the potential of this key sales period.

"As a brand known for its traditional links with Christmas, sales of the Coca-Cola portfolio have historically grown significantly, with an increased basket spend on Coca-Cola products during the festive season (Kantar). Keeping stocks of Coca-Cola variants high will be important in the run-up to Christmas as they look to meet consumer demand."

Vimto UK marketing manager, Emma Hunt, adds: "Christmas is the single biggest sales opportunity of the year and soft drinks are an essential part of this occasion. Consumers see the festive season as a time when they can trade up to premium and recognised brands, presenting high value and volume sales opportunities for retailers."

Turner recommends that retailers take advantage of special packaging or seasonal formats at Christmas time and display them prominently to capitalise on the opportunity.

"Secondary siting is a great way to help boost sales in store by capturing the attention of time-conscious shoppers who are making on-the-go, impulse purchases," he adds. "Once the main display has been utilised, where possible forecourt traders should look to implement secondary sitings along the path to purchase with the use of point-of-sale material and equipment to help attract shoppers’ attention."

Larger formats

Lucozade Ribena Suntory category director, Georgina Thomas, adds that during the autumn and winter months, there’s likely to be an increase in the purchase of larger format soft drinks as the frequency of sharing occasions rises.

"With the seasons being at the forefront of sharing opportunities with Halloween, Bonfire Night, Diwali and Christmas all coming up it is suggested that retailers stock the core ranges alongside a variety of sharing options such as the Lucozade Energy one litre formats.

"With the football and rugby seasons already started, sports enthusiasts will also be on the look out for sharing formats as they enjoy matches together, while grassroots players may be using convenience stores to purchase functional drinks to enjoy on-the-go."

Thomas’ advice on stocking larger pack sizes is backed up by Nielsen market data, which reveals that December is the biggest month for soft drink multipack sales in impulse outlets.

Britvic commercial director for out of home, Nigel Paine, says: "The festive season is a really important time of year for the convenience channel for top-up shopping, so activity should focus on top-up packs, and those purchased to fulfil distress purchases or deferred sharing opportunities. Shoppers are looking for larger packs for events and expect to find soft drinks for sharing."

He advises that in particular, retailers should stock two-litre carbonates at this time of year: "Not only are they consumed on their own, but there is an opportunity to upsell products such as Pepsi, 7UP and R Whites as they are likely to be used as mixers. Remember to keep these in the chiller and cross-promote where possible."

Finally, Turner says meal deals are another key growth area. "CCE’s See The Opportunity report indicates a £127m opportunity for soft drinks as a meal accompaniment, as this area represents the period when most soft drinks are consumed. Meal deals are an effective way for retailers to achieve perceived value, allowing shoppers to select popular lunchtime items at a lower cost.

"They also carry benefits by encouraging consumers to buy all three components, including soft drinks to make up the meal deal, rather than just one or two items."

Add some nurishment

Growing demand for functional drinks presents a clear opportunity for forecourt retailers to generate additional profits. So says Nyree Chambers, head of marketing at Grace Foods UK, manufacturer of Nurishment, the UK’s best-selling nutritionally enriched milk drink (IRI).
Nurishment supplies consumers with vitamins, minerals, calcium and as much as 20g of protein per pack.
"As consumers’ lives become more hectic, they’re looking for more than just great taste from their food and drink they’re also looking for products that will help to take care of their bodies," explains Chambers. "Nurishment meets this demand by helping to replenish consumers’ lost energy through its exclusive mix of vitamins and minerals, especially when they don’t have time to stop."
Consumers already loyal to Nurishment continue to buy the original cans but Chambers says that Nurishment Extra in a 310ml PET format, ideal for drinking on the move, is attracting new ones to the brand.
"Forecourt retailers can boost profits by stocking functional drinks which are suitable for multiple occasions," Chambers advises. "Nurishment fits the bill we’ve found that it appeals to a broad range of consumers, from busy mums to gym-goers, to those doing work which involves physical stamina. They all have one thing in common, the demand for a delicious, nutritious snack which fits into their busy lifestyles and won’t interrupt their routine."

Brand update

Coca-Cola Enterprises has launched Glacéau Smartwater, made from British spring water, which is vapour distilled before electrolytes are added to give it a crisp, clean taste. It is available in 600ml and 850ml PET bottles, with recommended retail prices of 57p and 89p respectively. The brand was first launched in the US in 1996 and is now the leading premium water there. Great Britain is the first market in Europe to get Glacéau Smartwater, with a campaign fronted by actress Jennifer Aniston.
The Ribena berries were back on TV for the first time in three years last month. The TV advertising is followed this month by outdoor advertising focusing on the original blackcurrant squash, as well as digital and shopper activity.
Levi Roots new coconut water ’n’ lime still drink made some great distribution gains over the summer. A special non price-marked pack has been created for Welcome Break Services and a range of wholesalers including Spar Blakemore, Hancocks and James Hall, while Parfetts is now listing the £1 price-marked pack.
The Kit Out Project from Lucozade Sport gives consumers the chance to collect codes and redeem them for sports kits and equipment. The activity is part of the brand’s £10m Fuel to Rule campaign.
Barr Xtra Cola has seen sales of over £1m since its launch in February. AG Barr says it delivers a full-on cola taste with no sugar and, in independent research, it out-performed the competition on overall taste.
AG Barr says using an additional multi-buy element on its price-marked packs has been a great success. This mechanic was trialled last year on Rubicon one-litre cartons which were offered with a £1.29/2 for £2 flash on pack. This proved so successful that it has already been used on Irn-Bru and Barr flavours and is being repeated on Rubicon and also rolled out on Sun Exotic and KA one-litre cartons.
Volvic has launched a new look for its plain, sparkling, Juiced and Touch of Fruit ranges. The aim is to give the brand a fresh, modern twist as well as a more consistent look across the different ranges. This autumn Volvic will be backed by a £1m campaign including TV and social media advertising.
Panda, which was the subject of a relaunch earlier in the year, is currently experiencing 21.9% year-on-year value growth (Nielsen) and it is anticipated that its back-to-school press and PR campaign will help the brand build on this success. A new packaging design was developed to drive reappraisal and trial across Panda’s juice drinks, flavoured waters and squash among mums of four-to-eight year old children by more clearly communicating the brand’s healthier positioning. The 250ml multipacks of still juice drinks and still flavoured waters contain no added sugar and only natural colours and flavours.

Retailer view

"Energy drinks is an important category for us. Red Bull took the market by storm but we then realised that the price was an issue for some consumers. We looked at a number of cheaper alternatives before settling on Boost, but our customers love the taste and the price and it is now our number two best seller in the category.
"There is a focus on the original and sugar free 250ml can and 500ml PET bottle, the one litre PET bottle and sport orange, which is currently flying off the shelves with its 50p price-marked pack. Sales largely come from people wanting an early morning boost, refreshment for long journeys and as a mixer.
"The guys at Boost really listen to us, and suggest new ideas. We have run some great initiatives together, where they have provided point-of-sale material as well as a good deal. We tend to stock more non-price marked products because it gives us greater flexibility when it comes to promotions, and we have both benefited with up to a 300% sales uplift!"

Best Practice

Soft drinks is one of the most profitable categories in your store, so ensure that your fixture is highly visible, well presented and located in a high footfall area between the door and the till.
Effective ranging, space allocation and stock availability are the most important elements to get right.
Make it easy for customers to find what they want by grouping categories and brands within them together. Then identify your best performing brands in each category and stock these at eye level with adequate facings to ’signpost’ segments.
Re-stock regularly, and where possible multi-site in store to take advantage of ’drink-now’ and ’take-home’ sales.
Chilled availability is the key driver for soft drinks sales, particularly in forecourts as shoppers are looking for refreshing drinks on their journeys.
Open deck chillers will encourage people to buy more soft drinks as they are easier to shop and they enable you to display a large choice of chilled products. However, you can make soft drinks work for you from the main fixture as well. Take-home products account for 24% of sales (Nielsen) and remain hugely important, as they are higher value items which encourage footfall and loyalty.
If a product is selling out regularly, increase the number of facings. Empty shelves mean lost sales so we’d advise reviewing your range and space allocation often, based on your own sales data and local knowledge.
Source: AG Barr