Innovate to stop soft drinks sales slump, says Britvic boss
Speaking at the eighth Innobev Global Beverages Congress in London, Moody said: "The year to come will be another challenging one for soft drinks companies. 86% of the UK population believes the country is still in recession and value considerations will have an increasing influence on buying choices. It is essential to continue to develop new offerings and renovate existing ones."
Fluctuating commodity costs had made things difficult for processors last year, with costs for juice concentrate, sugar and polyethylene terephthalate all soaring. Processors would confront similar issues in 2012, said Moody.
2011 had also seen a shift in consumer shopping habits, he added. "Saving money on food and drink has become increasingly important and a number of retailers are reporting consumers now buying to a fixed spend.
"Price downs and link deals [where buying two related items costs less than buying them separately] are the most effective. Large multi-buy deals that encourage people to spend more are less attractive."
Moody said the pubs and clubs sales channel had been hit particularly badly by the recession in 2011, slumping by 1% in value to £2.7bn and 4% in volume to 525Ml (CAG Brand Index, MAT 52 weeks ending November 26, 2011). This was due to consumers either drinking at home to save cash or cutting back on spending when out and about.
However, despite the challenges, overall sales of soft drinks rose by 4% in value to £9.7bn and 1% in volume to 6.99bn litres. Take home sales in retail channels rose 6.7% in value to £6.96bn and 1% in volume (Nielsen Scantrack data MAT, 52 weeks ending December 24, 2011).
Moody anticipated that the Queen's Jubilee weekend from June 25 would provide a boost for the category, as would "a long summer of sporting events", including the 2012 Olympics.
