Flavours of the month for beverage industry
flavours with the drinks giants who have all sought to innovate
with new flavourings in the last year. An industry report
highlights the reliance on new flavours for the competitive drinks
market.
A Reuters market report confirms the increasing use of flavours by the beverage industry to innovate in categories which have otherwise seen little growth.
Lemon, old-fashioned vanilla and cherry seem to be the most popular flavours with the drinks giants who have all sought to add interest to their colas with new flavourings in the last year. Lemon varieties from both Coca-Cola and PepsiCo were introduced in the US, and Vanilla Coke is to be launched this month.
The report claims that Cadbury Schweppes is gearing up for a summer launch of a new version of Dr. Pepper with a stronger cherry taste.
A spokesman for Dr. Pepper/Seven Up, the Texas unit of London-based Cadbury, declined to comment on reports that such a drink, or a vanilla version, is in the works.
"To take a well-known flavour and to extend it a little bit I think is a low-risk type of move," said Prudential Securities beverage analyst Jeff Kanter. "You've got to try to keep on innovating, that's the name of the game," he added.
A new variety would be the first extension of the Dr. Pepper brand since a diet Dr. Pepper drink was launched in 1963, and cherry versions of 7 UP and Diet 7 UP came out in 1987.
Dr. Pepper is the sixth most popular soft drink in the US and has been facing new launches from competitors, such as the 2001 launch of Pepsi-Cola's Mountain Dew Code Red.
According to a Beverage Digest/Maxwell report, Dr. Pepper volume fell 1.7 per cent last year, and Dr. Pepper lost 0.1 share point of the market.
Kanter suggested that rumours of a new flavour would have something to do with offsetting these declines.
Mountain Dew Code Red, which has a cherry-citrus taste and was launched in May 2001, posted a volume of about 70 million cases last year, even as regular Mountain Dew lost sales volume, according to the Beverage Digest/Maxwell study. A diet version will hit the market this summer.
Analysts have said that Coke and Pepsi are benefiting from new products, which are boosting results in the United States even as many consumers shy away from mainstream colas.
Mountain Dew Code Red followed the October 2000 launch of Sierra Mist, Pepsi-Cola's lemon-lime competitor to Coke's Sprite and Cadbury's 7 UP. Volume for 7 UP fell 7 per cent in 2001, according to Beverage Digest/Maxwell.
"These companies are in the business of trying to bring excitement to categories that haven't been growing that much and to the extent that they're doing it I think benefits all," Kanter said.
Pepsi's SoBe just introduced Mr. Green, a dark green-coloured drink which has a similar taste to Dr. Pepper.
Atlanta-based Coke launched Diet Coke with Lemon last year, while Purchase, New York-based Pepsi-Cola has regular and diet versions of Pepsi Twist on U.S. shelves.
Pepsi Twist is available as Pepsi Limon in Mexico and Pepsi Aha in India, and goes by Pepsi Twist in Brazil, Saudi Arabia and some other Gulf states. Pepsi Twist and Mountain Dew Code Red are also sold in Canada.
