Consumers Thirst for Functional Beverages

NEW YORK—The U.S. refreshment beverage market shrank by 3.1 percent in 2009, representing the second consecutive year of declining volume, according to data from the Beverage Marketing Corporation. However, certain key beverage types and brands continued to advance even as most of the larger categories lost volume.

Reflecting consumer demand for healthier and more functional beverages, ready-to-drink tea and energy drinks both grew in 2009. A functional element alone was not enough to sustain growth in challenging circumstances, however, as the atypical decline in sports beverage volume demonstrates. Moreover, energy drinks’ 0.2 percent growth in 2009 was much slower than it had been in recent years.

Carbonated soft drinks remained by far the largest liquid refreshment beverage category, but they continued to lose both volume and market share. Certain soda trademarks, such as Dr Pepper, did achieve growth. Carbonated soft drinks held five of the top 10 positions in the rankings of trademarks by volume, including four of the first five spots. Those were joined by three bottled water trademarks, including Nestlé Pure Life in the Nestlé Waters North America brand’s second appearance on the list of leaders. The biggest sports beverage in the United States still stood as the fifth biggest liquid refreshment beverage trademark despite softness in its category. The only fruit beverage trademark in the group stood in seventh place in terms of volume.

“Although 2009 was the second year in a row of unusual weakness in liquid refreshment beverages’ performance, the worst may be over,” said Michael C. Bellas, chairman and CEO, Beverage Marketing Corporation. “Beverages are likely to be one of the first categories to benefit with a job-led economic recovery because they represent an inexpensive form of pleasure.”

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