Soft Drinks Build Brand Equity Among Consumers During COVID-19 Pandemic
Kantar's BrandZ report shows soft drinks increased in perceived worth and innovation.
NATIONAL REPORT — Coming out of the pandemic in areas related to positive consumer brand relationships, fast-moving consumer goods (FMCG) brands scored the highest among five market sectors analyzed in Kantar's BrandZ Insights 2021 US Retail report.
Based on what BrandZ considers to be the building blocks of brand equity, FMCG brands were found to be highest in "Meaningful," or meeting needs in relevant ways and/or building affinity; "Different," or being unique vs. competitors and/or setting trends; and "Salient," or coming quickly to mind.
Among FMCG product categories, soft drinks in particular increased in perceived worth.
According to Kantar, the percentage of consumers in the report who were price-driven increased from last year, as well as the financial pressure of the pandemic and greater price consciousness. However, the research found that people recognized soft drinks as increasingly worth the cost.
Accordingly, soft drink giants The Coca-Cola Co. and PepsiCo Inc. increased in value during the pandemic. The report found that Coca-Cola's value increased 5.4 percent from 2020, while Pepsi's value rose 14.2 percent. PepsiCo's higher increase is largely due to pandemic-related demand for snack food, which makes up a significant part of its portfolio.
Coca-Cola and PepsiCo also increased in equity and innovation. Coca-Cola's innovation score rose from 112 to 120 as it added energy drink and hard seltzer brands to its portfolio, while Pepsico's innovation score increased slightly from 105 to 106. The BrandZ Index average is 100.
"Months of social distancing, financial pressure and uncertainty changed consumer spending priorities and shopping habits," said Arifa Sheikh, senior director of brand strategy at Kantar. "While these developments complicated ongoing challenges for some brands, soft drink brands had a relative advantage navigating these challenges compared to other brands due to their ability to meet the needs of consumers and be top of mind at consideration."
Kantar's proprietary BrandZ Valuation Methodology uses consumer viewpoints to assess brand equity, and how consumers perceive and feel about a brand as a measure of potential success or opportunity.
The BrandZ Insights 2021 US Retail ranking, report and analysis are available online here.