Although a staple within the North American beverage market, the juice and juice drinks category has been challenged as other beverage categories have emerged as go-to options for consumers in terms of hydration and refreshment. Chicago-based Mintel highlights the obstacles that the juice market has faced against these other categories in its June 2018 report titled “Juice and Juice Drinks – US.”

“Competition from other drinks is hurting juice sales,” the report states. “Consumers do not have as strong associations with juice as they do with other beverages. For example, if a consumer wants hydration, he’ll likely choose water over juice.

“Consumers don’t necessarily have negative associations with juice but juice does not adequately satisfy enough key occasions/need states,” the report continues. “Juice brands need to focus on capturing specific occasions.”

In its report, the market research firm estimates that total juice sales will reach an estimated $19.5 billion, which represents a 1.2 percent decline from five years ago.

“Most of the declines within the market are due to the falling sales of 100 percent juice,” the report states. “Sales of bottled smoothies are now also falling after years of growth, and while juice drink sales are increasing, total growth, will be minimal.”

Also recognizing the challenges of the juice and juice drinks market, Gary Hemphill, managing director of research for New York-based Beverage Marketing Corporation (BMC), adds that some sub-segments are adding value to the category.

“Sales of juices and juice drinks continue to be soft,” he says. “While there are some bright spots particularly in the high end of the market, the category has experienced weak performance for a number of years.”

Shelf-stable bottled juices

(Categories)

  DOLLAR SALES % CHANGE VS. PRIOR YEAR UNIT SALES % CHANGE VS. PRIOR YEAR
Fruit drinks $2,363,735,002 0.3 1,382,043,869 0.2
Cranberry cocktail / juice drinks $1,004,590,445 -0.6 385,650,539 -0.8
Apple juice $905,225,116 -0.6 383,630,035 1.4
Tomato / vegetable juice/cocktail $449,616,649 -1.9 156,365,518 -1.7
Lemonade $383,222,677 0.9 245,855,631 -1.1
Fruit juice blends $319,248,467 6.9 111,818,705 7.1
Cranberry juice / cranberry juice blends $279,190,220 2.3 77,157,549 2.8
Orange juice $246,307,807 -4.3 104,628,163 -3.4
Grape juice $225,330,127 -2.9 64,639,883 -5
Lemon / lime juice $197,362,853 3 101,782,318 2.6
Sparkling juice $155,075,050 -6.4 59,133,766 -11.1
Cider $114,931,501 -2.8 37,663,452 -1
Other fruit juice $103,401,235 -2.6 36,891,979 -0.3
Prune / fig juice $101,676,959 -8.5 21,632,797 -8.2
Cherry juice $61,575,889 -1.1 13,443,303 0.2
Grapefruit cocktail $48,547,025 -12.8 19,583,592 -16
Pineapple juice $42,371,335 5.8 12,035,583 6.3
Grapefruit juice $35,464,550 -6.3 12,367,775 -6.6
Juice and drink smoothies $28,464,796 15.5 13,837,128 4.7
Fruit nectar $14,651,404 -11.7 7,733,832 0.3
Apricot juice $142,546 20.4 57,903 20.2
Total $7,089,102,240 -0.3 3,251,113,854 -0.2

Source: Information Resources Inc. (IRI), Chicago. Total U.S. supermarkets, drug stores, mass merchandisers, gas and convenience stores, military commissaries, and select club and dollar retail chains for the 52 weeks ending Nov. 4, 2018.

 

Sugar complex

Noting that the juice and juice drinks market is experiencing combatants on numerous fronts, Mintel’s report points to sugar concern from consumers as one of the culprits.

“Consumer concerns over the amount of sugar in juice is perhaps the largest issue impacting the juice market,” the report states. “Forty-one percent of consumers who don’t buy 100 percent fruit juice say the high amount of sugar in the juice prevents them from making a purchase. Unfortunately, because the sugar in 100 percent fruit juice is natural, 100 percent fruit juice brands can’t just lower the total amount of sugar in the drinks. Instead, juice brands need to diversify product offerings and identify new opportunities through product innovation.”

Chicago-based Euromonitor International also highlights the obstacle that sugar content has posed to the juice industry in its February 2018 report titled “Juice in the US.”

“Like many other soft drink areas in recent years, juice has struggled to overcome challenges associated with high sugar content,” the market research firm states. “While consumers remain consciously aware of the health benefits juice and its fruit parts can offer, consumers increasingly realize that not all juices are created equal.”

Noting that sugar content is a top product attribute impacting the juice and juice drinks category’s narrative, BMC’s Hemphill highlights that the industry is seeking to address these concerns.

For example, the Washington, D.C.-based Juice Products Association launched sipsmarter.org, a website dedicated to educating consumers about the science-backed health and nutritional benefits of 100 percent juice.

“More than 80 percent of Americans do not eat the recommended amount of fruits and vegetables. One hundred percent juice is an easy, tasty way to incorporate more fruits and vegetables into your diet.” said Diane Welland, Registered Dietitian for the Juice Products Association, in a statement at the time of the website launch. “We hope that the Sip Smarter website and campaign will educate consumers seeking facts about juice and inspire them to feel good about enjoying juice as part of a balanced diet.

“Research shows that people who drink 100 percent juice have higher intakes of whole fruit and a better overall diet quality compared with non-juice drinkers,” Welland continued. “We know that despite the positive science, there’s some confusion and criticism out there about juice. We want people to have easy access to science-backed information to address their questions ranging from nutrition and health benefits to sugar content and processing.”

On the Sip Smarter website, consumers can utilize the interactive “Find Your Juice Match” tool, which informs them about the potential health benefits that are associated with each type of juice. Additionally, more than 60 recipes are published in which juice can be used outside of beverage consumption, it says. Consumers also can read information from policy influencers and health professionals, including the most recent peer-reviewed research on juice and a Registered Dietitian toolkit.

Juice drinks manufacturers also are finding more ways to ease consumers concerns about sugar content. In mid-2018, Simply Beverages, a brand of Atlanta-based The Coca-Cola Co., launched a new Simply Light line in four flavors: Simply Light Orange Pulp Free, Simply Light Orange with Calcium & Vitamin D, Simply Light Lemonade, and Simply Light Lemonade with Raspberry.

Simply Light beverages are a direct response to those who want to enjoy orange juice or lemonade, but with less sugar and fewer calories than regular juice drinks, the company says.

“Today’s consumers want a variety of beverage options that help them maintain a well-rounded, healthy lifestyle without sacrificing taste, which is why Simply is a leader in the category,” said Kelly Marx, Simply Beverages brand director, in a statement at the time of the launch.

Perrier Sparkling Mineral Water, a brand of Stamford, Conn.-based Nestlé Waters North America, also recognized the potential of lightly sweetened juice drinks. This past summer, the sparkling water brand launched Perrier & Juice Drink, a line extension that combines Perrier’s original carbonated mineral water with splashes of natural fruit juices, the company says. The 45-calorie beverage is available in three flavors: Strawberry & Kiwi, Pineapple & Mango and Peach & Cherry.

In its report, Mintel notes how less-sweet juices could serve as a growth opportunity for the category.

“Twenty-seven percent of consumers say that most juice is too sweet but this increases to nearly half of consumers who want low-sugar juice and don’t buy 100 percent fruit juice,” the market research firm states. “Since sugar content is a common reason why consumers don’t buy juice, there may be an opportunity for juice brands to connect with lapsed juice buyers through juices with a less-sweet flavor profile. Fruit juice blended with vegetables, coconut water, and even spices/herbs may appeal to consumers who want less-sweet juices.”

Camden, N.J.-based The Campbell Soup Co. also is addressing the dearth of less sweet juices with the launch of V8+Hydrate. The plant-based beverage line uses sweet potato juice and contains one full serving of vegetables with no artificial sweeteners, the company says. Packaged in 8-ounce cans, the 45-calorie beverage comes in three flavors: Strawberry Cucumber, Coconut Watermelon and Orange Grapefruit.

In Euromonitor’s report, the market research firm details that the implementation of the new Nutrition Facts label, which has been delayed until January 2020, could influence the future of juice product development.

“Most consequential will be the addition of added sugars on nutrition labels, which will play a defining role in helping to add validity to the term ‘healthy,’” the report states. “Already, Kraft Heinz has removed added sugars from a line of its immensely popular juice brand Capri Sun, showcasing the potential shockwaves the new labels may send through the juice market.”

 

Super solutions

In addition to less-sweet options, super-premium juices have shown to have a positive impact on the category.

“Super-premium juices and drinks are a bright spot in the overall fruit beverage market,” BMC’s Hemphill says. “They are growing while the overall category continues to decline.”

In BMC’s August 2018 report titled “U.S. Fruit Beverages through 2022,” the market research firm details that following a decline in 2009, the sub-segment grew in the eight subsequent years.

“In 2009, no doubt due to the weak economy, super-premium juice volume decreased by 7.8 percent,” BMC states. “But in 2010, they grew by 2.8 percent. In 2011, the recession loomed further back in the rearview mirror, as volume grew by 7.9 percent. The next three years saw robust double-digit growth. 2015 and 2016’s growth rates were a still-healthy 9.5 percent and 8 percent, respectively. In 2017, growth decelerated to 4.3 percent. On an anticipated 3.7 percent [compound annual growth rate] (CAGR), super-premium juice volume should reach 185 million gallons in 2022.”

A part of the broader super-premium juice revolution, organic varieties have expanded juices’ reach in the marketplace. However, analysts caution that the reach likely will be limited due to price constraints.

“Organic is a net positive for the category but organic products are more expensive, which may be limiting their growth,” Hemphill says.

In late 2017, Lakeville-Middleboro, Mass.-based Ocean Spray Cranberries Inc. added to the organic juice market with the release of Ocean Spray Organic 100% Juice Blends. Available in three flavors — Cranberry, Cranberry Apple and Cranberry Blueberry — each 8-ounce glass contains the equivalent of one cup of fruit with 100 to 130 calories, depending on the flavor, the company says.

Beverage-makers also are finding new ways in which to position organic juices. For example, 4Pure Inc., Cumberland, Maine, launched a new line of organic lemonades in three flavors: Original, Blueberry and Raspberry. Each 4Pure Organic Lemonade is crafted from real lemon juice, peak-season fruit purees and is lightly sweetened with sustainably tapped New England maple syrup, the company says.

Cold-pressed juice brand Evolution Fresh, a wholly owned entity of Seattle-based Starbucks Corp., also recognizes the impact that organic products are having on the juice market. The brand doubled down on its mission to source quality produce by announcing a commitment to offering 100 percent organic products this year. Evolution Fresh works directly with farmers to source organic produce, it says.

The brand commitment to organic could be seen from its 2018 juice smoothie releases: Evolution Fresh Daily Probiotic Smoothies and Complete Smoothies. The organic smoothies feature an amalgamation of cold-pressed fruit and vegetable juice with probiotics, coconut milk and other functional ingredients. These functional smoothies allow for expansion beyond super-premium juices to include premium functional beverages, the company says.

“We know a growing number of people are looking for more from their juice,” said Ryan Ziegelmann, president of Evolution Fresh, in a statement at the time of the announcement. “With our expansion into functional beverages, we are putting 24 years of experience to work to authentically expand what cold-pressed, high-pressure processed juice can deliver. Our new functional smoothies combine our cold-pressed juices with ingredients with functional benefits like probiotics, fiber and plant-based protein.”

 

Today’s juice consumers

As beverage manufacturers explore the potential of less sweet and organic juice offerings, analysts highlight the importance of understanding what the juice consumers of today look like.

In BMC’s report, the market research firm pinpoints data from a survey conducted by Scarborough Research about the incidences of juice consumption across various demographics.

Orange juice and fruit drink consumers

(*Index by income and race 2017)

HOUSEHOLD INCOME ORANGE JUICE FRUIT DRINKS
$75,000+ 98 84
$50-79,999 99 97
$40-49,999 102 107
$30-39,999 102 110
$30-39,999 102 110
$20-29,999 99 115
$10-19,999 106 121
105 126
 
RACE ORANGE JUICE FRUIT DRINKS
White 94 91
Black 120 136
Asian 83 78
Hispanic origin / descent 118 115
Other 92 103

* The propensity, relative to the total population, to consume a specifi c brand (mean = 100).
Source: Beverage Marketing Corporation; Scarborough Research

“[F]or orange juice users, high school graduates have coverage of 33.5 and composition of 32.9,” it states. “That simply means that diploma holders comprise 33.5 percent of orange juice users in the U.S. And it also signifies that 32.9 percent of graduates drink these beverages.”

Additionally, the report highlights that fruit drinks are consumed by 25.5 percent of the adult population and based on a population-neutral basis, women are more likely than men to be fruit drink consumers.

“Fruit drink consumers tend to be young, but not as young as some other beverage categories,” the report states. “In 2017, 28.6 percent of 18- to 24-year-olds consumed fruit drinks, 12 percent more than the 25.5 percent average among all adults. Whereas orange juice finds a pocket of popularity among the oldest adults, fruit drink consumption indexes generally decline with each advancing age cohort. Still, adults over 65 are only 2 percent less likely than the average to imbibe fruit drinks. Seniors have an index of 106 for orange juice consumption.”

In Mintel’s report, the market research firm suggests developing juice products that appeal to the iGeneration, who are just starting to enter the career job market.

“Juice brands can bring excitement to the juice market and attract new consumers through product innovation,” the report states. “iGens in particular are interested in trying new juice products, especially juices with added functionality such as being high in electrolytes or promoting relaxation.”

For instance, Mintel’s report featured data that asked 1,552 Internet users aged 18 and older who had purchased any juice type in the past three months to select the following juice drinks that they would be interested in trying. Sixty percent of iGens expressed an interest in fruit and vegetable blends, 2 percentage-points higher than all respondents. Also appealing to iGens were energy-providing juices in which 51 percent of the demographic named the product attribute, 11 percentage-points higher than all respondents for the same product attribute.

Supporting the energy trend, Concord, Mass.-based Welch’s debuted its Sparkling Plus Energy in two flavors: Sparkling Grape and Sparkling Fruit Punch. The line is made from sustainably farmed Welch’s juice and natural energy from organic coffee extract, the company says.

Welch’s also sees potential in targeting one of the quieter generations: Generation X. With the launch of its marketing campaign Tough as Grapes, the juice manufacturer is focusing on Gen X men through a “tough and gritty” look at how Welch's Grape Juice is made with one of the world's “toughest” antioxidants, the company says.

The brand strategy is backed by research on Gen X males where Welch's uncovered:

  • 59 percent of Gen X men report they are the primary grocery shopper
  • 73 percent of Gen X men drink juice with breakfast
  • 60 percent of Gen X men like grape-flavored juice

While men already drink more juice than women, they also are more open to the nutritional benefits that juice offers, particularly because they are more aware that there is room for improvement in their health, the company added.

"The juice category and shopping behaviors are changing, and we knew it was time to disrupt the category by making a bold move to reinvigorate the juice aisle," said Lesya Lysyj, Welch's president of the U.S., in a statement at the time of the announcement. "After comprehensive research, we discovered that the market potential is with Gen X men, a demographic that loves juice and has emerged as a primary grocery shopper. The Tough as Grapes campaign solidifies our commitment to the modern grocery shopper, while championing the tough antioxidants in our Concord grapes."

Another important demographic for juice are parents, particularly millennial parents.

“Parents out-purchase nonparents for every juice type with millennial parents in particular being an important consumer group for juice drink brands,” Mintel’s report states. “Juice brands need to develop products that satisfy the needs of millennial parents. For example, many of the growing kids’ juice brands are organic and carry low-sugar claims.”

BMC’s Hemphill notes that juices positioned toward children have shown slight achievement. “Dedicated kids’ juice brands have had modest success,” he says. “Tried and true brands like Juicy Juice and others are being joined by more premium options. Kids drink these brands as well as [the] mainstream juice brands their parents are drinking. But some parents limit kids’ juice intake due to sugar.”

Given the mixed bag of variables impacting the juice and juice drinks market, BMC is predicting the juice and juice drinks market will contract during the next five years with a CAGR of -1.3 percent. “While not a cause for celebration, this would represent the category’s best performance since 2001-2006’s compound annual growth rate (CAGR) of -0.9 percent,” the report states. BI