4 - Refresco.de

Market review 2009
Trends in the soft drink & juice market
The past year, 2009, was dominated by the recession that started in the second half of 2008 and shook the entire
world. Many segments felt the impact, with consumer behavior drastically turning around. The soft drink and juice
business in which Refresco operates was, in its own way, also touched by the economic downturn; however, the impact
was strongly dependent on segment and category.
In this section we give an overview of the major market trends
in the European soft drink and juice business in the past year.
Information is gained from market intelligence agencies and
from our own experiences.
Market movements
Over the last three years, the growth of the European soft drink
market has been slowing down to a negative 0.4% growth rate
at 145.5 billion liters. For the larger Western European countries
market conditions for growth have been modest, with large
variations between categories.
Overall, in 2009 the soft drink market in Europe declined
by 2.34 million liters (-1.6%) compared to 2008. European
consumers have reduced their spending fuelled by
unemployment fears and uncertainty over the economic
recovery. Reduced spending has mainly affected on-premise
consumption. In some European markets, off-premise has
compensated for falling on-premise consumption, mainly
as a result of massive price promotions and the excellent
performance of some private label products.
In 2009 packaged water still has the highest market share
(41%) by volume, but suffered a loss of 905 million liters,
mainly as a result of unfavorable weather in parts of Europe,
low on-premise consumption, and consumers switching to
more economical alternatives, such as tap water, as a result
of the economy. Carbonated Soft Drinks (CSDs) declined by
915 million litres in 2009, mainly as a result of heavy losses
in Eastern Europe, with the exception of Poland. In Western
Europe, CSDs registered slight growth, mainly as a result of
the positive performance of private labels in countries such
as Germany. The ‘un-healthy’ image of CSDs is also affecting
growth in some markets but CSDs still maintain the second
largest market share of European consumption at 32.4% for
2009. Juice suffered a loss of 607 million litres, mainly due
to consumers switching to more economical fruit beverages
such as nectars and fruit-flavored still drinks as a result of
the economy. Conversely, the strong move towards smoothies
and Not From Concentrate (NFC) juices continued, filling the
demand for healthier products. Squash/syrups was one of the
few categories to register a positive performance in 2009 as
a result of its cost advantage in times of economic hardship.
Ready to Drink Ice teas/coffee drinks and energy drinks had a
positive performance across Europe, albeit from a low base.
The steady volume growth of energy drinks still perseveres
(9.4%), but these still have a very small market share (1%).