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Global Soft Drinks Market: Going Sugar Free

 5 min read / 

Studies from the World Health Organisation have shown that a simple can of carbonated soda contains over 40 grams of sugar, an equivalent to 10 teaspoons of table sugar. This significant sugar quantity in soda is believed to contribute to the increasing prevalence of lifestyle diseases such as obesity, diabetes, but also teeth decay and the weakening of bones, among adults and children globally. Soft drinks contain large amounts of refined sugars, conferring a high glycemic load whilst having poor satiating properties. To respond to this alarming observation, the World Health Organisation has issued recommendations to implement a taxation on sugary drinks, to help reduce sugar consumption and prevent obesity. As many countries have yet developed their own sugar-taxation initiatives, consumers are looking to reduce their sugar intake and change their diets to become healthier.

Whilst many manufacturers have decided to respond to these changing consumer needs by re-evaluating their beverages recipes with reduced sugar (and to avoid the sugar-tax), some have developed soft drinks with new flavours and better-for-you ingredients.

Trends in Asia

In Sri Lanka, the beverage company Elephant House has launched sugar-free variants of its popular drinks to encourage consumers to adopt a healthier lifestyle.

This strategic move responds to the company “Go Sugar Free” initiative, enlarging its product portfolio with innovative soft drinks alternatives, offering a similar taste to its initial products but with no added sugar. Whilst the International Diabetes Federation suggested that over 10.7% of the Sri Lankan population had diabetes, the company believes that this initiative will help consumers to try healthier drinking habits, and will potentially reduce this number significantly.

In Japan, The Coca-Cola Company has developed a new product: Coca-Cola Clear, a zero-calorie lemon-flavoured carbonated soft drink, a completely transparent soda which looks just like bottled water. The soda giant has tested multiple recipes before landing on its winning option: a carbonated cola with no caramel ingredients, thus leaving behind its traditional brown colour. The company, however, insists that their new beverage maintains a similar flavour to its coloured options.

South Korea is embracing the ginseng trend, with beverage manufacturer Jinsamga releasing a Sparkling Korean Red Ginseng-flavoured powered drink. This innovative concept is positioned as a healthy soft drink, delivering just the right amount of energy to consumers, using plant-based ingredients.

Trends in Europe

In the United Kingdom, the negative media spotlight on sugar has had a big impact on consumer purchase habits. Given the recent implementation of Britain’s sugar tax, many soft drinks companies are re-evaluating the sugar content of their products or developing a new panel of low or reduced-sugar beverages with additional functional health benefits, to respond to consumer expectations.

Company Sandows has developed a sugar and dairy-free carbonated coffee, existing in two varieties: Citrus and Spice. This new product is extending the coffee soft drinks category and answering the high-sugar concerns over energy drinks nutrition components.

In Germany, the trend toward an organic and green diet is gaining ground, despite the absence of any sugar tax on food and drink. Consumers’ rising desire for naturalness, health and wellness attributes in their drinks have led beverage manufacturer Voelkel to develop a Maximum Bio Energy Drink, a combination of matcha tea, green coffee and guarana berry beverage.

Trends in America

In the United States, the per capita consumption of soft drinks has been declining quite significantly since 2016, following the recommendation of the US Food and Drug Administration, and the American Heart Foundation to reduce soda consumption. However, Ready-To-Drink Coffee volumes have grown quite significantly and recently became the fastest growing segments in the soft drink market. Cold brew coffee sales are booming with annual sales reaching over $38m in 2017 according to market researcher IRI. Perceived as a healthier alternative than energy drinks and soda, consumers across the US have made a shift in their consumption, looking for a cheaper beverage than speciality coffee and have shown an increased preference of on-the-go options.

Since the announcement of a sugar tax as a recommendation to reduce weight gain by the World Health Organisation, many soft drinks companies have taken on the opportunity to rethink their corporate strategy and re-evaluate their beverages recipes, whilst others have simply reduced their packaging size to continue hitting strategic price points and reach their annual goals. Despite growing concerns over health risks, it seems there are strong disparities in soft drinks corporations’ approach around the world. Instead of looking at the sugar intake of consumers, maybe it is time to rethink beverages as part of a greater nutrition movement rather than considering soft drinks as “treats”. There is an important scope for further development in the soft drinks category. As consumers are keen on healthier products and looking for “beneficial” consumption (or a way to boost their energy levels), companies have a wider scope for innovation.

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