In Stevie Wonder’s 1972 classic ballad, “You Are the Sunshine of My Life,” he croons, “You are the sunshine of my life, That's why I'll always be around. You are the apple of my eye, Forever you'll stay in my heart,” professing his love for then-wife Syreeta Wright. Within beverages, the natural, nutritious and “sunshiney” goodness of orange juice has been a staple in consumers’ hearts throughout this past century. Through the years, the high sugar content of juice and juice drinks and its association with breakfast time had the category floundering. Yet, the COVID-19 pandemic and consumers seeking healthful, immune-supporting benefits has led to a resurgence in juice and juice drinks.
In Chicago-based Mintel’s June 2020 report “Juice and Juice Drink: Incl Impact of COVID-19, US,” Madelyn Franz, cross-category research analyst at Mintel, defines the nearly $19 billion juice and juice drinks market as “sizable but struggling.”
“Juice has been going through an identity crisis of sorts, which has put the category in a tough spot,” Franz explains. “Products tend to toe the line between healthy and indulgent without committing to either position, leaving consumers confused and disengaged. While it’s been relegated to very specific consumption occasions as a result, the COVID-19 outbreak has granted brands a chance to break free from the category’s downward trajectory.
“Thanks to the pandemic and subsequent recession, consumers’ needs have actually aligned with the benefits that juice has been offering all along: comfortable, cost-effective, vitamins,” she continues. “More than that, it’s created a brief window of opportunity for the category to reset, retarget and recover in the longer term.”
Gary Hemphill, managing director of research for New York-based Beverage Marketing Corporation (BMC), agrees that the pandemic and more people staying at home have positively impacted the category’s performance.
“After several consecutive years of soft market performance, juices and juices drinks are experiencing modest volume growth in 2020,” he says. “Fruit beverages are one of the few categories that have actually experienced improved performance due to the pandemic. More people staying at home have improved the category’s performance.
“Citrus juice, especially orange, is performing well, driven by a jump in take-home sales,” he continues. “Fruit beverages have been rejuvenated in 2020, due to improved take-home sales performance driven by the impact of the pandemic.”
BMC data suggests a rise in volume for fruit beverages, from 2.861 billion gallons in fiscal year 2019 to a projected 2.915 billion gallons in fiscal year 2020, while 100 percent juice is projected to rise to 1.561 billion from 1.540 billion. However, on the retail side, fruit beverages and 100 percent juice are expected to decline in dollars year over year (YoY) from $26.3 million and $18.1 million, respectively, to $25.2 million and $17.3 million.
Data from market research firms document the growth of the fruit drinks category from 2019 to 2020. In the overall fruit drinks category, New York-based Nielsen reports dollar sales of $6.9 billion for the 52 weeks ending Oct. 24, 2020, an 11.1 percent YoY increase. Orange juice and apple juice were top sellers, with dollar sales of $3.5 billion and $1 billion, respectively, and YoY increases of 15.3 percent and 5.9 percent. Rounding out the Top 5 were grape, with sales of $249 million, a 4.7 percent increase; pineapple, with a double-digit increase of 14 percent and $214 million in sales; and cranberry, with $193 million in sales and a 14 percent YoY increase.
When compared with previous years, 2020’s double-digit rise in consumer usage documents how far the top juice segments have risen. For instance, for the 52 weeks ending Dec. 29, 2019, and Dec. 29, 2018, orange juice declined 2.2 percent and 3.6 percent, respectively, while apple juice was down 1.5 percent and 1.7 percent.
However, 2020 has been a decidedly different year. Up 11.8 percent, refrigerated juices and drinks generated sales of $7.1 billion, while the largest segment, orange juice, saw sales of $3.2 billion and a 15.5 percent YoY increase in multi-outlets and convenience stores for the 52 weeks ending Nov. 1, 2020, states Information Resources Inc. (IRI), Chicago. At No. 2, refrigerated fruit drinks clocked in at $352 million, a 6.2 percent increase. Rounding out the Top 5 were refrigerated lemonades, with a 17.8 percent rise in sales to $934 million; refrigerated juice and drink smoothies saw sales of $812 million, a 2.2 percent increase; and pomegranate juice, generated a 10.8 percent increase and sales of $115 million, albeit from a much smaller base.
Experts note that the pandemic has sparked a demand for such ingredients as vitamin C and probiotics to promote immunity and digestive health, respectively.
In its December 2019 “Juice in the US” report, Chicago-based Euromonitor International states that unlike other health trends, interest in digestive health has consistently grown as evidenced by increased sales of brands that offer added probiotics.
“Good Belly has been a standout brand within nectars and demonstrates the potential for juices which promote gut health,” the report states. “Long-declining juice drinks saw growth in value sales in 2019 thanks to the notable performance of the Bai brand.”
Capitalizing on consumers seeking no- or low-sugar juice options, CHERRiSH, Bellevue, Wash., released a new flavor, Cherry Chocolate, to its low-glycemic, non-GMO, no-sugar-added lineup. The varietal, along with Cherry Original, Cherry Pomegranate and Cherry Blueberry, harnesses the power of U.S.-grown Montmorency tart and sweet Bing cherries, and offers high levels of antioxidants and anti-inflammatory and sleep-benefiting properties, the company says.
The importance of a healthy immune system is top-of-mind for most consumers, renewing interest in a familiar functional ingredient: vitamin C, states Mintel’s June 2020 Juice and Juice Drinks report.
“As a result, demand for orange/citrus juice has skyrocketed, driving the category’s unprecedented growth. Industry giants (e.g., Tropicana, Minute Maid) and lesser-known brands (e.g., Uncle Matt’s Organics, Natalie’s Orchid Island) have both seen increased year-over-year sales,” the report states. “Consumers’ standing investment in wellness will make immunity claims a priority in the longer term. However, brands will need to address the pre-pandemic concerns that plagued the juice category (e.g., high sugar content, limited functional benefits) to maintain growth once hype surrounding the virus subsides.”
Falling victim to rapidly shifting trends and products that offer similar hydration credentials, coconut waters, once the lone symbol of hope for the juice category, and ready-to-drink (RTD) smoothies are expected to see declining sales as consumers have more time than money on their hands.
“Current estimates expect RTD smoothie sales to fall to $721,000 by 2025, down 19.4 percent from the end of 2019,” Mintel’s report states.
To compete with the growing list of niche better-for-you beverages such as still and sparkling waters, and nutritional drinks, juice brands will need to deliver on consumers’ definition of “healthy” in 2021, including the addition of premium added-value claims.
BMC’s Hemphill says, “We believe once the impact of the pandemic has subsided, sales are likely to be softer and the category may see declines once again.”