Global soft drinks major Coca-Cola Europacific Partners (CCEP) is set to launch a raft of energy and sports drinks NPD into multiple markets, as the category continues to deliver robust and growing profits for the maker.
Several Monster and Powerade launches will hit the shelves across many of CCEP’s 31 global markets next year, group commercial development director Oliver Crick says.
Functional drinks had become one of the group’s fastest-growing categories, with the energy and sports segments providing some of the biggest returns.
“The functional category as a whole has significant household penetration and is growing,” Crick says. “Energy, aside from water, is adding more growth than any other softs.
“We still see lots of growth in the traditional sparkling and soft drinks – like Coke and Fanta – but sports and energy continue to grow ahead of the category overall."
The business was taking its investment and NPD cues from the North American market, where functional and energy drinks there had near 70% penetration, compared to just 25% in Europe.
Energy had already transformed as a category globally from a few players, such as Red Bull, to a competitive market with flavours and products that would be unrecognisable a decade ago, says Crick.
Monster and Burger King deal
Flavour would continue to drive innovation in the energy segment, but there’d also be an increasing focus on ‘clean energy’, which was “small and niche now, but we can see the headroom for no artificial and plant-based energy”, he explains.
There would be a leaning towards additional sugar-free and new flavour variants within the Monster portfolio, “which follows our Monster Ultra launch, which is the biggest sugar-free energy drink across most of our markets”, he says.
Foodservice was also a growing focus for Monster, which had just gained a Burger King, Spain, listing with its Green and Mango Loco variants.
New launches would first appear in the UK and German markets, where Monster tended to perform better, he adds.
Sports drinks had further to grow against energy, despite the segment’s age, he believes. “In Europe, household penetration is at 18%, but it’s 45% in Spain and only 3% in France, so there’s a big gap and a huge educational piece needed,” says Crick.
Consumers lacked understanding of when and where sports drinks could be consumed. “One of the main reasons people buy into the segment is for refreshment, but in Australia, consumers look for the electrolyte element.”
“We need to educate consumers in more markets about the category to grow it as a whole, we can all benefit from that,” he says.
One way to drive consumers to the segment was through innovation, which over indexes, he explains. During the Paris Olympics, CCEP launched and promoted Powerade Golden Mango, leading to an over +10% sales increase across CCEP’s European markets year to date, he adds.
New Powerade one-litre bottles
“In Germany, we’re looking at different Powerade pack formats with a one-litre bottle which launched this year. This was based on consumer insight that showed us gym-goers were buying two 500ml bottles, so the one-litre will cover that,” he reveals.
Powerade is already sold in one-litre bottles in Australian supermarket chain, Coles.
Other Powerade innovations would include new flavour launches and additional pack formats across multiple territories. Though Crick would not give details of what variants and when they will launch, he says products doing well in strong markets – such as in Australia – would be translated into others.
New launches would likely land in Germany, which is “our market for Powerade innovation launches”, he says.
“But if you look at the sports market, APAC is really strong with Powerade, Zero-Sugar and Active Water, so you’ll see those in other markets,” adds Crick.
CCEP would also back its NPD launches and sales growth with additional factory investment, specifically for production lines. “Because we’re growing so fast, you get to the point where lines get full,” explains Crick.
“We have investment across the business, in manufacturing capability and in innovation,” he says. “We’re also increasing spend on supporting our brands, like with Powerade and the Olympics and Monster with Formula 1.”
CCEP had in November already committed to €1bn of capex investment, with hundreds of millions to be spent on line upgrade, logistics and other networks.
