A battle for hearts and minds:

Exploring the role of function vs emotion in the world of soft drinks

Within FMCG, innovation has always played a significant role in brand building as well as driving trial and retention.  In a highly competitive context, success is often measured by gaining strong cut through in increasingly cluttered categories.  Traction and engagement typically come as a result of novelty and by delighting or surprising consumers, tapping into their adventurous spirit and following through with a satisfying product experience that goes beyond the purely functional.

Beverages is a category that is ripe for this type of disruption. It is one that enjoys constant evolution and iterative innovation and that is in thrall to evergreen macro trends such as health & wellness. So, with this in mind, let’s have a closer look at a couple of examples of brands that are shaking up the category…

Redefining ‘functional’

Functional has long been a trend within beverages, with the likes of Coca Cola’s Smartwater & start-up mavericks Dirty Lemon bringing value added products to the market, but one brand has gone beyond mere ‘wellness’ as a benefit by calling out very specific health claims.

Canadian company Infuse Your Life Health Products recently launched in its home market and has been given approval to make a whole host of lofty health claims such as: “boosts cardiovascular and cell health”.  This blurring of boundaries, whilst not unique in the wider food and drink space, feels significant and is clearly indicative of where the market is viably moving. It’s also a move that taps into rising consumer demand for brands and products that seamlessly and efficiently slot into their holistic healthy lifestyles.

Taking water to the next level

One of the biggest growth sectors in beverages in 2018 was within natural, flavoured waters.  The success of US brand La Croix amongst Millennials has led to multiple entrants to the market, including PepsiCo with their Bubly brand, eager to take advantage of the increasing consumer shift towards natural, authentic products. In the UK, big players such as Britvic and AG Barr launched Aqua Libra and Le Joli respectively, taking fruit infused waters mainstream, but it’s also a big enough space to accommodate independent upstarts such as Dash and Ugly.

With consumers & governments taking a stance against sugar, this move towards natural, no sugar alternatives is a logical step and the sub-sector looks set for further growth in 2019, particularly as big players look to diversify their portfolios to protect against any future revenue drop off from their core sugar ranges. In this increasingly fragmented and busy space, it will be interesting to see what play Coca Cola might make via Dasani or a new launch

What is certain is that as consumers seek out increasingly sophisticated, surprising and natural beverages the tide is turning towards a post-functional category where taste and refreshment are no longer compelling differentiators.  In a more demanding, disruptive and competitive context,  it’s clear that traditional big players must work increasingly hard to remain relevant and central to consumers lives.

Of course one way to infuse your brand with a RTB beyond function is to move the brand-consumer conversation into a more emotive space. And whilst Coca Cola has long since abandoned its ‘Happiness’ positioning, it’s perhaps telling that Pepsi’s brand new global positioning ‘For the love of it’ sits very firmly in an emotional heartland.

Which all leads to the question, will 2019 be the year of the simplicity and pragmatism of Coca Cola or the warmth and meaning of Pepsi?

By: The Value Engineers

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