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Indians shun fizzy drinks, turn to juices

24-June-2005
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Indians shun fizzy drinks, turn to juices

Indians are fast acquiring healthy habits. In keeping with trends worldwide, summer sales in India show that people are preferring juices, juice-based drinks, iced tea, flavoured milk, buttermilk and lassi over fizzy cola drinks.

Juices and other non-aerated drinks are growing at a blistering 35-40% compared to fizzy drinks which are notching up a 10% growth. Although the base numbers of aerated drinks are higher, the soft drinks industry sees the perceptible shift towards 'healthy' drinks in consumer taste.

Admitted Coca-Cola vicepresident, marketing, Vikas Gupta: “Juices and juicebased drinks are leading the overall beverage market.” Added Dabur GM Sanjay Sharma: ''Our traditional fruit-based beverages, including drinks like aam panna, are being snapped up. We are, in fact, running short of supply.''

What's driving this momentum is a changing public perception towards colas and other aerated drinks.

While this is in line with international trends - in Japan, for instance, Coca-Cola sells more non-aerated than aerated drinks - increased awareness in schools about alleged harmful effects of aerated drinks caused by the pesticides controversy is making people turn towards healthier alternatives, be they juices or flavoured milk.

Interestingly, within carbonated beverages segment, it's lime-based drinks like Sprite, Limca and 7-Up, besides diet variants of Coke and Pepsi, which are growing faster than the two big colas.

It's the same in the US, Europe and Japan. In the US, for instance, fizzy drinks have been on the decline since their sales peaked in 1998, while categories like water, energy drinks and juices are growing. Pepsi's volume declined by 4% last year, while Coca-Cola has launched only diet drinks in the last two years.

Changing Taste

US: Fizzy drinks on decline since 1998. Pepsi slumped 4% last year, Coke bringing only diet drinks

UK: Fruit juices command 66% of market, growing at 60%. Even Coke launching juices

JAPAN: Iced tea and coffee dominates market. Coke's Georgia coffee outsells cola.

INDIA: Juices and non-fizzy drinks growing at 40%. Colas grow at 10%

Juice brands growing faster

It's not just in India that people are preferring juices, flavoured milk, buttermilk and juicebased drinks over fizzy cola drinks.

In UK, Coca-Cola introduced Minute Maid juice this month to meet booming juice sales. In Japan, Coca-Cola's Georgia coffee outsells Coke. In India, PepsiCo's Tropicana and Dabur's Real are driving growth in the 100% juice market, while various non-aerated beverage brands have flooded retail shelves. Coke has relaunched its fruit-based drink Maaza in three flavours, while Amul has added buttermilk to its range of flavoured milk and cold coffee, and Parle Agro has given a new look to Frooti.

Said Amul GM, marketing, R S Sodhi, “The recently-launched buttermilk has crossed sales of three-lakh packs per day, while flavoured milk brand Amul Kool is selling four lakh packs daily.”

Obviously, tetra packaging is playing a role in making available these health drinks more easily. Rasna has hired Hrithik Roshan to push sales, while Nestle has stepped up distribution for its tetrapak milk and cold coffee range. Godrej's XS fruit juice, and Mother Dairy's Safal have also stepped up marketing and distribution spends. Smaller juice brands like Leh Berry and Tuk 3 are also growing in healthy double digits.

PepsiCo executive director Subroto Chattopadhyay said its juice brands Tropicana and Tropics have grown very fast this summer. In addition, HLL's Lipton iced tea, being distributed by Pepsi, is already turning in substantial volumes, though the company said it was too early to provide sales numbers.

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