The Beverage Wrap-Up

Can you judge a beverage by its package?

Packaging is one of the most crucial factors in any industry — it not only protects and stores the product, but it also differentiates it and attracts consumers. Packaging innovation is on the rise lately, particularly in beverages.

Of the 4,245 new beverage introductions in 2013, 22 percent were new packaging, according to the most recent beverage packaging research from Mintel. The research identified the importance of innovation in eco-friendly, altruistic and ergonomic packaging designs to meet consumer expectations and, to a lesser extent, innovation in aesthetic qualities to help brands stand out on a crowded shelf.

“The beverage industry is continuing to recover from the economic downturn and shoppers will continue to pay attention to health, nutrition and ingredient labeling, as well as sustainable packaging attributes over design elements,” said Elizabeth Sisel, beverage analyst for Mintel. However, shoppers are not willing to put more money where their packaging preferences are. “Despite higher demands for more informative, convenient and sustainable beverage packaging, consumers do not want to [pay] higher prices.”

Nevertheless, beverage manufacturers are betting on packaging investments — and the subsequent increase in sales volume they are hoping will follow.

In the beer category, Anheuser-Busch put a packaging slant to its innovation recently with less of a focus on new products and more on the outside elements of its primary lines.

“The best thing we could do for our core brands is elevate their image,” explained David Almeida, vice president of sales and wholesaler development. Last year, the company rolled out its 25-ounce can (an extra ounce as a reward to consumers) and an aluminum bottle with a twist-off cap so consumers can opt to reclose the beer.

Resealable bottles and cans are also growing in the energy drinks segment as a new way manufacturers cater to the lifestyles of their target audience. According to Mintel, nearly a third of energy drink consumers aged 18–34 are interested in resealable bottles or cans.

‘MINIMIZE ME’

A reclosable cap is also a way to cater to consumers’ growing desire for smaller portions. Slimming down the can is another — as Heineken has done. The brewer is supporting its new 8.5-ounce slim can with marketing efforts such as advertising and point-of-sale that emphasize “cold to the last drop” and “perfect for any occasion” consumer benefits.

“Sales of small-can offerings (8–9 ounces) grew more than 350 percent last year, delivering incremental volume and profit to retailers across all channels,” said Jonathan Simpson, director of commercial marketing for Heineken USA. “The small can keeps the liquid colder longer and has strong appeal among multicultural consumers looking to unwind after work or elevate their casual social gatherings.”

Shrinking packages in carbonated soft drinks are on the rise, too, as both The Coca-Cola Co. and PepsiCo Inc. push 7.5-ounce mini cans and 8-ounce and 8.5-ounce glass and aluminum bottles, which can cost consumers more than twice as much per ounce, according to The Associated Press. Reportedly, these smaller cans and bottles are giving soda a sense of newness among the growing proliferation of beverage choices, while catering to the consumer desire for more modest servings in high-calorie beverages.

The health and wellness trend has set up “a tremendous opportunity for the Coca-Cola brand with our smaller packages,” said Sandy Douglas, Coca-Cola’s North American president.

Smaller options are part of how the carbonated soft drink giants are repositioning their brands amid changing consumer habits around soda, according to Bonnie Herzog, managing director of beverage, tobacco and convenience store research at Wells Fargo Securities LLC.

Smaller offerings are a way beverage manufacturers are addressing concerns with caffeine and sugar content by allowing consumers to control their consumption, Mintel noted.

Controlling beverage consumption through pouch packaging is another innovative hit, particularly in the energy drinks arena, where consumers add the desired amount of water to a pouch pack that contains the (often organic) drink mix. The popularity of pouches is attributed to their portability as well.

Beyond pouches, other attributes that are accelerating because they aid in portability include lightweight packaging, bag-in-box and paper-based packaging.

ACES FOR ASEPTIC

Aseptic processing and packaging, found in Special K Shakes and other yogurt-style drinks, has helped grow the beverage category recently for Allen Brothers Wholesale Distribution, a convenience store distributor in Philadelphia that serves Pennsylvania, New Jersey, Delaware, Maryland, New York and Washington, D.C.

“Not only are they a healthier alternative, but their shelf life is more conducive to the c-store,” Dave Oehlert, senior buyer, told Convenience Store News. There are also a number of “prominent protein drinks” that c-store customers are starting to substitute for a candy bar or sandwich. Rockin’ Refuel from Shamrock Foods Co. is one the distributor cited.