2023
9
UK Carbonated Soft Drinks Market Report 2023
2023-02-03T03:03:38+00:00
OX1103439
2995
160175
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Report
en_GB
“CSDs have again proved resilient to squeezed incomes, supported by their affordability and roles as mood-boosting treats and alcohol replacements. With associations with littering curbing sales, doing more to tackle…

UK Carbonated Soft Drinks Market Report 2023

$ 2,995 (Excl.Tax)

Description

The UK Carbonated Soft Drinks Market Report 2023 identifies the current performance of the CSD market, consumers’ attitudes towards CSDs, and influencing factors on the market. This report covers the CSD market share, market opportunities, and key industry trends for the UK CSD Market.

Carbonated Soft Drinks Market – Current Landscape

Despite challenges presented by the cost-of-living crisis, total carbonated soft drinks (CSD) volume sales in 2022 exceeded those seen in 2019 by 3.3%. This highlights the category’s resilience to squeezed incomes, supported by the drinks’ affordability and their roles as mood-boosting treats and alcohol replacements. However, the record-breaking summer weather will have been a key contributing factor to the market’s buoyancy.

Variants positioned as natural and those with added health benefits remain niche in the CSDs market, with innovation in these areas typically being the domain of small, challenger brands. However, there could be lucrative potential for the major players to also explore these areas, given the sizable demand for such activity from consumers’ favourite brands.

CSD Market Trends and Key Industry Opportunities

While flavour continues to be the core innovation battleground in the CSDs market, texture should not be overlooked. Almost half of CSD drinkers express an interest in different textures, which presents an opportunity for innovation. Interest in the texture concept is also notably higher among those who agree that CSDs with lower carbonation are better for you than those with higher carbonation. This may indicate that health is a concern for CSD drinkers, further bolstered by the launches of various added health benefits CSD drinks.

The prevalence of CSD littering in public spaces is curbing sales, creating a strong commercial incentive for brands to position themselves as part of the solution to this problem. The introduction of Deposit Return Schemes (DRS) may also act as a deterrent for purchasing CSDs. However, by lessening the negative connotations with single-use packaging waste, DRSs should help keep consumers engaged with the CSDs category in the longer term. CSD brands can benefit from actively supporting DRSs, for example by raising awareness around these schemes and their sustainability benefits.

  • CSD Market Share: 15.8% increase in Fanta’s annual volume growth to October 2022, while Coca-Cola saw an overall decline.
  • CSD Market Trends: 63% of adults say that a CSD brand that helps to reduce littering of cans/bottles would be more appealing than one that doesn’t.
  • CSD Market innovation: 22% of drinkers aged 25-34 said they would be interested in CSDs with a creamy/velvety foam, presenting a portion of the market that may be interested in CSDs using gases other than carbon dioxide.

Future Forecast for the CSD Market

CSD affordability and the importance of emotion-led usage drivers – which become more powerful during times of hardship – have helped to insulate the CSD category from consumers’ economising habits within grocery shopping. However, 2023 may see a decline in volume sales given the unexpected boost from the unusually hot summer of 2022. Moving forward to 2025, as consumers spend less cautiously and the alcohol moderation movement becomes more widespread, real-term growth is expected.

Looking ahead, the penetration of in-home soda making systems is likely to continue to grow amid the ongoing spotlight on packaging waste. Growing competition in the soda maker market should also continue to make prices more accessible.

With the first DRS in the UK to be introduced in Scotland later in 2023, some major CSD brands are raising concerns about the implementation and roll-out of the scheme across the rest of the UK. In particular, as UK constituent countries are planning to roll out DRSs differently.

To discover more about the Carbonated Soft Drink Market, read our Attitudes Towards Drinks Packaging Market Report, or take a look at our extensive Drinks Market Research.

Quickly Understand

  • The impact of the cost-of-living crisis on the CSD market.
  • The outlook for the CSD market in the re-emergence from the pandemic and recovery up to 2027.
  • The latest NPD trends.
  • CSD usage, and how purchasing behaviour would be affected by the need to save money.
  • Consumers’ behaviours and attitudes towards CSDs, including towards textures and added health.

Covered in this Report

Products: All mainstream CSDs are included in the market size. Diet carbonates are included. Mixers (including tonic water, ginger ale, soda water and bitter lemon) are included.

Brands: Coca-Cola, PepsiCo, Fanta, Fever-Tree, AG Barr, Schweppes, Dr Pepper, Britvic, SHS Group, Belvoir Fruit Farms, Fentimans, Nix & Kix, Punchy Drinks, Nexba, Peak Mood Drink, and more.

Expert Analysis from a Food & Drink Specialist

This report, written by Emma Clifford, a leading analyst in the Food & Drink sector, delivers in-depth commentary and analysis to highlight current trends in the CSD market and add expert context to the numbers.

CSDs have again proved resilient to squeezed incomes, supported by their affordability and roles as mood-boosting treats and alcohol replacements. With associations with littering curbing sales, doing more to tackle this and actively supporting the DRS will reap rewards for brands. Meanwhile, textural innovation could be the next frontier for CSDs in light of consumer interest in this area.

Emma CliffordEmma Clifford

Associate Director – Food and Drink Research

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • Products covered in Report
  2. Executive Summary

    • The five-year outlook for the CSDCSDs market
      • Figure 1: Category outlook, 2023-27
    • The market
    • Market size and forecast
      • Figure 2: Market forecast for value sales of CSDs, 2017-27
    • Numerous factors driving up costs for CSDs
    • Buying less CSDs in retail is most popular to save money on them
    • Limited negative impact from HFSS restrictions
    • Companies and brands
    • Mixed performances for the Coca-Cola portfolio; Fanta is the star performer
      • Figure 3: Leading brands’ value sales in the UK retail CSDs market, 2019/20-2021/22
    • A rise in fortified NPD in 2022; brands up the ante on adventurous flavour NPD
    • Adspend doubled in 2021
    • The consumer
    • Overall usage of CSDs rises in 2022, helping volume sales edge up
      • Figure 4: Usage of CSDs, by type, 2020-22
    • Those with less healthy finances are more frequent drinkers
      • Figure 5: Frequency of usage of CSDs, by type, 2022
    • Explore textures as the next frontier for innovation; demand for natural and added-health brand extensions
      • Figure 6: Behaviours relating to CSDs, 2022
    • Involvement in litter reduction and supporting DRSs will reap rewards
      • Figure 7: Attitudes towards CSDs, 2022
  3. Issues and Insights

    • Explore textures as the next frontier for innovation
    • Involvement in litter reduction will reap rewards…
    • …as will actively supporting the DRSs
    • A need to encourage trial of CSDs made from branded concentrates
  4. Market Size and Performance

    • 2022 volume surpasses pre-pandemic levels
      • Figure 8: Total UK value and volume sales of CSDs, 2017-22
  5. Market Forecast

    • The five-year outlook for the CSDs market
      • Figure 9: Category outlook, 2023-27
    • Volumes set to slip into decline in 2023
    • Volumes to return to growth in 2025
      • Figure 10: Market forecast for value sales of CSDs, 2017-27
      • Figure 11: Market forecast for volume sales of CSDs, 2017-27
    • Learnings from the last income squeeze
    • Forecast methodology
  6. Market Segmentation and Channels to Market

    • The on-trade’s recovery gains momentum in 2022
      • Figure 12: Value and volume sales of CSDs, by channel, 2019-22
    • Mixed performances across the segments in retail
      • Figure 13: Retail value and volume sales of CSDs and adult soft drinks, by segment, 2019-22
  7. Market Drivers

    • Numerous factors driving up costs for CSDs
    • Buying less CSDs in retail is most popular to save money on them
      • Figure 14: How consumers would react to having less money to spend on CSDs, 2022
    • Inflation is the key concern for consumers and brands…
    • …and despite government support, energy prices are still a major concern
    • Rising interest rates mean that the pressure will move up to middle- and higher-income households
    • High inflation and rising interest rates will compound the impact of the slowing recovery
    • Consumer spending power will be curbed
    • Unemployment is at a near-50-year low
    • Consumers’ financial wellbeing has fallen from the highs of 2021…
      • Figure 15: Household financial wellbeing index, 2009-22
    • …and most people are feeling the effects of price rises
    • HFSS food and drink store location restrictions come into place in 2022
    • New rules on the advertising of HFSS food and drink delayed to 2025
    • Contaminants study could put people off recycled PET
    • Plastic packaging tax comes into effect
    • Requirements for attached caps see various brands redesign their bottles
    • Scotland’s DRS to be implemented in 2023
    • England, Wales and Northern Ireland all plan to introduce DRSs
    • Fears grow of a ‘chaotic’ DRS roll-out across the different UK nations
  8. Market Share

    • Mixed performances for the Coca-Cola portfolio
    • Coca-Cola Zero Sugar performs strongly, Diet Coke and Coca-Cola decline
    • Fanta is the star performer; Schweppes falls behind
      • Figure 16: Leading brands’ sales and shares in the UK retail CSDs market, by value and volume, 2019/20-2021/22
    • Own-label is the big success story in adult soft drinks
      • Figure 17: Leading brands’ sales and shares in the UK retail adult soft drinks market, by value and volume, 2019/20-2021/22
  9. Launch Activity and Innovation

    • A surge in NPD with less than 5g sugar
      • Figure 18: Share of CSDs launches, by sugar content per 100ml, 2017-22
      • Figure 19: Share of CSDs launches, by claims relating to sugar and calorie content, 2017-22
    • A rise in fortified NPD in 2022
      • Figure 20: Share of CSDs launches with a vitamins/mineral fortified claim, 2017-22
      • Figure 21: Fortified CSD launches, UK, 2022
    • Brands look to support mental wellbeing
      • Figure 22: Peak botanical drinks, UK, 2022
    • FUL launches sparkling spirulina drink
    • Brands up the ante on adventurous flavour NPD
    • Coca-Cola creates intrigue with its limited-edition flavours
      • Figure 23: Coca-Cola limited-edition launches, UK, 2022
    • Fanta brings out three more mystery flavours
    • More activity in berry flavours
    • Candy Can launches into Sainsbury’s
      • Figure 24: Trio of Candy Can drinks launched into Sainsbury’s, UK, 2022
    • More sophisticated flavour NPD in mixers and adult soft drinks
    • Belvoir launches trio of botanical sodas
      • Figure 25: Belvoir Farm Botanical Sodas, UK, 2022
    • Fever-Tree continues to regularly release new flavours
    • M&S expands its adult soft drink range
      • Figure 26: Premium CSD launches from M&S, UK, 2022
    • Many ethical claims plateau in 2022
      • Figure 27: BrewDog’s P.O.P Soda range, UK, 2022
      • Figure 28: Share of CSDs launches, by claims relating to ethics and sustainability, 2017-21
    • Tango teams up with The Prince’s Trust for limited-edition launch
    • The shift away from the use of plastic over 2018-20 has reversed
      • Figure 29: Share of CSDs launches, by packaging material, 2017-22
    • Schweppes and Cawston Press look to premium glass bottles
    • Coca-Cola launches on-pack technology for visually impaired shoppers
  10. Advertising and Marketing Activity

    • Adspend doubled in 2021
      • Figure 30: Total above-the-line, online display and direct mail advertising expenditure on CSDs, 2019-22
    • Coca-Cola puts more focus on shared experiences
      • Figure 31: Total above-the-line, online display and direct mail advertising expenditure on CSDs, 2019-22
    • Coca-Cola ups spend on Diet Coke in 2022
    • CCEP celebrates relaxation for Zero Sugar Zero Caffeine and Sprite brands
    • Fanta champions ‘colourful’ people
    • Pepsi Max and Irn-Bru put the focus on unparalleled taste
    • Pepsi continues to push its strong footballing links
    • Biggest campaign to date for Cawston Press
    • Nielsen Ad Intel coverage
  11. Brand Research

    • Brand map
      • Figure 32: Attitudes towards and usage of selected brands, 2022
    • Key brand metrics
    • Coca-Cola Zero Sugar and Sprite see usage increase
      • Figure 33: Key metrics for selected brands, 2022
    • Brand attitudes: Fever-Tree wins on perceptions of quality and innovativeness
    • Weak value-for-money associations make the category vulnerable
      • Figure 34: Attitudes, by brand, 2022
    • Brand personality: Fanta has the strongest fun factor
    • Brands score fairly well on ethical associations
      • Figure 35: Brand personality – Macro image, 2022
    • Schweppes has the most traditional image
      • Figure 36: Brand personality – Micro image, 2022
  12. Usage of CSDs

    • Overall usage of CSDs rises in 2022, helping volume sales edge up
      • Figure 37: Usage of CSDs, by type, 2020-22
    • Those with less healthy finances are more frequent drinkers
      • Figure 38: Frequency of usage of CSDs, by type, 2022
      • Figure 39: Daily usage of CSDs, by age group, 2022
  13. Behaviours Related to CSDs

    • Textures could be the next frontier for innovation
      • Figure 40: Behaviours relating to CSDs, 2022
    • Take inspiration from global activity in this area
    • Nitrogenated drinks can tap into interest in CSDs with a creamy foam
      • Figure 41: Examples of jelly soda drinks, China, 2022
    • Inspire consumers to experiment with textures themselves
    • Call out lower carbonation
    • Demand for natural and added-health brand extensions
    • There are challenges to overcome in these areas
    • Less sweet flavours offer a natural route to cutting sugar
    • Make functionality part of a holistically healthy proposition
  14. Attitudes towards CSDs

    • Involvement in litter reduction will reap rewards
      • Figure 42: Attitudes towards CSDs, 2022
    • DRSs should support engagement with CSDs by combating littering
      • Figure 43: Attitudes towards CSDs, by usage of CSDs, 2022
    • Soda-making machines can appeal by addressing packaging waste
      • Figure 44: Attitudes towards at-home soda-makers, by ownership of at-home soda-makers, 2022
    • A need to encourage trial of CSDs made from branded concentrates
  15. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  16. Appendix – Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 45: Market size and forecast for total volume and value sales of CSDs, 2017-27
      • Figure 46: Market forecast and prediction intervals for total value sales of CSDs, 2022-27
      • Figure 47: Market forecast and prediction intervals for total value sales of CSDs, 2022-27
    • Market drivers and assumptions
    • Forecast methodology
  17. Appendix – Market Share

      • Figure 48: Leading manufacturers’ sales and shares in the UK retail CSDs market, by value and volume, 2019/20-2021/22
      • Figure 49: Leading manufacturers’ sales and shares in the UK retail adult soft drinks market, by value and volume, 2019/20-2021/22

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This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

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