Set to beat competition to a pulp?

Beverage consumption patterns in India have seen a definite shift over the years, with lifestyle changes and higher affordability reflecting on consumer choices. First it was the cola wars, then soft drinks became popular, until packaged fruit juices began gaining acceptance among a health-conscious generation.

This section comprises primarily youngsters and a population willing to spend on premium food products. Pitched as a healthier alternative to colas and other fizzy drinks, the packaged fruit juices segment has seen considerable growth in recent years, led by product innovation and repositioning campaigns.

India is the third largest beverage market in the world, after the US and China. Today, the packaged juices market in India is driven by three categories — fruit drinks (Coca-Cola’s Maaza and PepsiCo’s Slice) with around 10 per cent fruit pulp, fruit juices (PepsiCo’s Tropicana and Dabur’s Real Fruit Juice) with over 90 per cent fruit pulp in sugar-free, concentrated or non-concentrated form and nectars (Dabur’s Real Nectar), essentially the pulp of fruits such as cranberry, peaches and apricot, which contain anywhere between 20 and 90 per cent fruit pulp, depending on the flavour.

Explosion of flavours Big players such as Dabur, Pepsi, Godrej and Parle Agro have done the hard work in establishing a high-growth segment and creating consumer acceptance, making it easier for newcomers Surya Foods and Agro, Mother Dairy, Ladakh Foods and Pioma Industries to join the bandwagon.

The market, headed towards an annual growth rate of 30 per cent, is witnessing an explosion of sorts with packaged fruit juice makers expanding their portfolio and experimenting with new flavours — the most recent entrants being Paper Boat’s ‘Kanji’, ‘Sattu’ and iced tea with tulsi and adrak flavours and Tropicana’s coconut fruit blends.

While carbonated drinks still lead the market at 82 per cent, their growth rate has decelerated due to the positioning of fruit juices as a healthy drink.

Existing popular brands, which were pitched differently at their launch, are now repositioning themselves as health drinks. Cadbury India launched mango-flavoured Tang, focusing on the nutritional aspects of the fruit. Known for its innovation in the segment, Tropicana, on the other hand, introduced coconut fruit blends. Its existing exotic flavours such as pomegranate, cranberry and peach lend an international touch.

Paper Boat’s traditional flavours aamras, jamun, jaljeera, kokum, imli and golgappa in innovative packaging are pitched on nostalgia, bringing back childhood memories.

The per capita consumption of beverages in India has increased by nearly 50 per cent over the last 10 years. Spurred by the rapidly evolving segment, many international brands are entering the market, targeting niche consumers. Britvic, the British drinks maker, launched a very niche drink targeted at children in the 8-12 age group. The Robinsons Fruit Shoot is available in four new flavours thought to be popular among young consumers — apple and pear, strawberry and raspberry, apple and blueberry and the all-time favourite mango.

A recent trend of celebrity endorsements for fruit juices has added positive brand-building impact — like Bipasha Basu endorsing Dabur’s Real Activ juice and Shahrukh Khan endorsing Parle’s Mango Frooti. Retail sales of packaged fruit juices, however, still have some barriers to cross before they can overtake the fizzy drinks, as the young generation still prefers drinking colas and energy drinks compared to fruit juices. One of the biggest challengers of fruit juices and fruit drinks are hot beverages like tea and coffee which still remain the popular choice at breakfast tables.

Packaging trends Consumers have come a long way from consumption of juice in loose form to bottles, cartons and large PET bottles. This has largely been influenced by the popularity, and consumption levels, which have grown over the years. With growing consumer acceptance, packaging of fruit beverages is also evolving. While cartons revolutionised the concept of packaged food and continue to enjoy a large market share in the non-carbonated beverage segment, fruit juice in recyclable PET packaging has overtaken carton packaging due to its wide availability and easy processing. The small, single-serve cartons are, however, still popular for on-the-go consumption and ease of carrying around.

When fruit juices were first introduced, they were primarily made of more artificial ingredients than real fruit content.

As the industry evolved and the demand for real fruit content in juices grew, manufacturers turned to packaging concepts that preserved the nutrients of the real fruit, maintaining freshness, hygiene and a longer shelf life.

The small cartons are thus designed for consumption at one go while the large cartons and aseptic PET packaging use components to ensure that the quality of the product is retained for a longer time.

Another significant contributor to the growth of PET is the ‘seeing is believing’ notion which has made transparent PET bottles more popular among consumers who like to see what they are drinking.

Unlike cartons, PET also allows for customisation and a particular bottle design then becomes synonymous with the brand.

The beverage segment is one of the fastest growing users of PET bottles and the market is estimated to grow at 15 per cent annually to reach 5.2 billion by 2017-18.

Coca Cola’a Maaza and Minute Maid, Pepsi Slice and Parle Agro’s Appy which are enjoyed across age groups, are available in PET bottles ranging from 250 ml to 2 litre sizes.

Owing to its sheer convenience, light weight, unbreakable aspect and 100 per cent recyclable properties, PET is one of the most sought-after packaging solutions for fruit-based drinks. Parle’s Frooti is the latest to join the club, unveiling its new packaging with Shah Rukh Khan glugging the mango drink from a PET bottle, rather than a carton.

Though we haven’t yet developed a habit of drinking fruit juice like the Westerners, changing lifestyles and increased awareness of health across generations will continue to fuel their demand.

As long as consumers are willing to experiment with new flavours, sometimes at a premium cost, and the health concept remains popular, the juice market is set to grow exponentially. Estimates indicate that juice sales will overtake that of carbonated drinks by 2016 while other segments like sports and energy drinks and juice concentrates will not see a big change in consumption volumes.

So glug away to your health and heart’s content.

Vimal Kedia is Managing Director, Manjushree Technopack Ltd