Emerging Flavors in Soft Drinks: New flavor blends, next generation superfruits, and future opportunities

Flavor stimulates one or both of the senses of taste and smell and/or as well as the tactical and temperature receptors in the mouth. Flavor in drinks is derived from a variety of sources, including added ingredients or reactions occurring during blending and processing.
From a consumer perspective, the main trends driving the soft drinks market are health and wellbeing, consumer sophistication, simplicity, experimentation and ethical and “green” purchasing. These consumer trends are putting pressure on the flavor industry to be much clearer and precise in terms of flavor definition (e.g. bourbon, Tahitian or Mexican vanilla), declaring whether flavors are natural or synthetic and stating the exact health benefits and ethical credentials of products. Some of the consumer trends overlap and others are contradictory which creates complexity for manufacturers as well as providing opportunities for the development of new and niche flavor groups.

This report provides a comprehensive review of growing and emerging flavors in soft drinks globally by sub-segment and region. In addition, it evaluates the drivers affecting the development of flavors, the technological developments and innovations in the soft drinks flavoring industry.

Key features of this report

• An evaluation of the current market dynamics in soft drinks and the key drivers behind the trends including a breakdown of consumer issues.
• An assessment of the latest regulatory developments in terms of product claims and nutritional labelling and how they impact the soft drinks industry
• Analysis of the key flavor trends from a regional and a segment-specific perspective as well as insight on new and fast growing flavors.
• An outline of new developments in science and technology including satiety, nutrient boosting and natural sweeteners; and an overview of how they will impact future flavor innovation.

Key Market Issues

• From a consumer perspective, the main trends driving the soft drinks market are health and wellbeing, consumer sophistication, simplicity, experimentation and ethical and “green” purchasing
• These consumer trends are putting pressure on the flavor industry to be much clearer and precise in terms of flavor definition, informing consumers about the “green” and ethical credentials of ingredients/flavors, declaring whether flavors are natural or synthetic and stating the exact health benefits on labels.
• Flavors derived from high antioxidant, rich in vitamins or minerals, low sugar, and natural sources are growing in popularity even where no explicit health claims have been made by manufacturers.
• Due to their novel and often exotic flavor profiles and their widely reported health benefits, superfruits, herbs and botanicals will remain an important trend in soft drinks flavors.

Key findings from this report

• In bottled water, varieties of spices and herbs grew in popularity, with cinnamon, ginger, and basil all appearing in significantly more products in 2009, along with cardamom, cassis, black tea, and calamansi lime.
• A growing trend in concentrates is the launch of products designed to mix into either alcoholic or non-alcoholic cocktails. This area has widened into multiple flavor variations including Amaretto, Bloody Mary, Cosmopolitan, Irish Cream, Margarita, Mojito, and pina colada.
• In functional drinks herbs, spices and exotic fruits all increased in frequency. Chamomile had the most significant growth and a number of berry variants also appeared more frequently, including wild berry, and blue raspberry.
• Blended juices accounted for over 40% of new juice products launched in 2009. An emerging trend in juice drinks is to combine the health benefits of exotic fruits with herbs and teas to create a ‘superjuice’
• Differentiating flavors by varietal, specie or origin will grow in the future as it will offer manufacturers the opportunity to expand ranges in mature flavor categories or to provide variety within a flavor group..

Key questions answered

• What are the key consumer drivers of the soft drinks industry and how are they impactilng flavor innovation?
• What are the latest legislative challenges facing the industry and how does this affect the claims that can be made on product labels?
• What are the most popular and fastest growing flavors by soft drinks sub-segment and which segments are the most innovative?
• What opportunities do the latest technological developments in satiety, nutrient boosting and natural sweeteners present for the flavoring industry?
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Table of Contents
Emerging Flavors in Soft Drinks
Executive summary 10
Market trends and drivers 10
Flavor trends in new product launches 11
Innovation trends and future outlook 12
Conclusions 13
Chapter 1 Introduction 16
Report overview 16
Flavors in soft drinks 16
Research methodology 17
Report structure 18
Chapter 2 Market trends and drivers 20
Summary 20
Introduction 21
Market overview 21
Functional drinks outpace other segments 22
Market drivers 23
Health and wellbeing 25
Functional foods 27
“Better for you” 29
Consumer sophistication 30
Simplicity 31
Experimentation 32
Ethical and “green” purchasing 33
Legislative challenges and labeling issues 34
Guidelines on “natural” flavors 36
Chapter 3 Flavor trends in new product launches 40
Summary 40
Introduction 41
Regional analysis 41
Bottled water 41
Carbonates 43
Concentrates 44
Functional drinks 46
Juices 47
RTD tea and coffee 49
Segment analysis 53
Bottled water 53
“Cold” grows as a selling point 60
Carbonates 63
Concentrates 69
Functional drinks 76
Juices 80
RTD tea and coffee 85
Product claims analysis 91
Bottled water 91
Carbonates 91
Concentrates 92
Functional drinks 93
Juices 94
RTD tea and coffee 95
Chapter 4 Innovations trends and future outlook 98
Summary 98
Introduction 99
New research boosts functionality of traditional flavors 99
Fruits 99
Coffee and tea 101
Technologies to improve flavor 102
Chocolate 103
Milk 104
Flavoring opportunities 105
Satiety 105
Fiber 105
Proteins and amino acids 106
Fats 107
Plant extracts 107
Nutrient boosting 108
Protein supplements 108
Fat reduction 108
Sweeteners 109
Stevia 109
Grain, cereal, and other plant extracts 109
Honey 110
Chapter 5 Conclusions 112
Summary 112
Future trends 113
Superjuices 113
Flavor precision 114
Blending familiar and exotic flavors 114
The emergence of new superfruits 115
Appendix 116
Index 116
References 118
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Figure 2.1: Global soft drinks sales by segments ($bn), 2008-2013 21
Figure 2.2: Consumer trends driving the soft drinks market 23
Figure 2.3: Flavor industry pressures that are driven by consumer trends 24
Figure 2.4: Percentage of overweight and obese adults by country (%), 2004-2009 25
Figure 3.5: Top 5 flavors in bottled water launches by region (%), 2009 42
Figure 3.6: Top 5 flavors in carbonated launches by region (%), 2009 44
Figure 3.7: Top 5 flavors in concentrates launches by region (%), 2009 45
Figure 3.8: Top 5 flavors in functional soft drinks launches by region (%), 2009 47
Figure 3.9: Top 5 flavors in juice launches by region (%), 2009 48
Figure 3.10: Miss Beauté from Ueshima 50
Figure 3.11: Hieshirazu-san no Shoga Chai (Chilly Miss, chai with ginger) from Nagatanien 51
Figure 3.12: Freshen and Relax from Unif 52
Figure 3.13: Top 5 flavors in RTD tea and coffee launches by region (%), 2009 53
Figure 3.14: Outback Spirit Rejuvenating Water from Robins Foods 56
Figure 3.15: Multi Vitamin Plus from Ignite Corp 60
Figure 3.16: Freezing Point Natural Cold Soda, from Heilongjiang Jiangkangzhiquan 61
Figure 3.17: Healthy Thirst from Thorncroft 69
Figure 3.18: Nitrous Monster Energy Drink from Hansen Natural 80
Figure 3.19: Smart Juice Australia, from Smart Juices LLC 85
Figure 3.20: China Mist teas 87

Table 2.1: Global soft drinks market size by segment ($bn), 2008-2013 22
Table 2.2: Global functional soft drinks market size by segment ($bn), 2008-2013 22
Table 2.3: Average life expectancy (years) at birth, 1950-2015 27
Table 2.4: Value of ethical food and drinks in the UK, (£), 1999-2008 33
Table 3.5: Region share of bottled water launches (%), 2008-2009 42
Table 3.6: Region share of carbonates launches (%), 2008-2009 43
Table 3.7: Region share of concentrates product launches (%), 2008-2009 44
Table 3.8: Region share of functional soft drinks launches (%), 2008-2009 46
Table 3.9: Region share of juice launches (%), 2008-2009 48
Table 3.10: Region share of RTD tea and coffee launches (%), 2008-2009 49
Table 3.11: Top 20 flavors in bottled water launches (%), 2009 54
Table 3.12: Top 20 fastest growing flavors in bottled water launches (% change), 2008-2009 55
Table 3.13: Top 20 fastest growing flavors in bottled water launches (rank change), 2008-2009 57
Table 3.14: Flavor group share of bottled water product launches (%), 2008-2009 58
Table 3.15: Top 20 flavors in carbonates launches (%), 2008-2009 64
Table 3.16: Top 20 fastest growing flavors in carbonates launches (% change), 2008-2009 65
Table 3.17: Top 20 fastest growing flavors in carbonated launches (rank change), 2008-2009 66
Table 3.18: Flavor group share of carbonates launches (%), 2008-2009 67
Table 3.19: Top 20 flavors in concentrates launches (%), 2008-2009 70
Table 3.20: Top 20 fastest growing flavors in concentrates launches (%), 2008-2009 72
Table 3.21: Top 20 fastest growing flavors in new concentrates launches (rank change), 2008-2009 73
Table 3.22: Flavor group share of concentrates launches (%), 2008-2009 74
Table 3.23: Top 20 flavors in functional soft drinks launches (%), 2008-2009 76
Table 3.24: Top 20 fastest growing flavors in functional soft drinks launches (%), 2008-2009 77
Table 3.25: Top 20 fastest growing flavors in functional soft drinks launches (rank change), 2008- 2009 78
Table 3.26: Flavor group share of functional soft drinks launches (%), 2008-2009 79
Table 3.27: Top 20 flavors in juice launches (%), 2008-2009 81
Table 3.28: Top 20 fastest growing flavors in juice launches (% change), 2008-2009 82
Table 3.29: Top 20 fastest growing flavors in juice launches (rank change), 2008-2009 83
Table 3.30: Flavor group share of juice launches (%), 2008-2009 84
Table 3.31: Top 20 flavors in RTD tea and coffee launches (%), 2008-2009 86
Table 3.32: Top 20 fastest growing flavors in RTD tea and coffee launches (% change), 2008-2009 88
Table 3.33: Top 20 fastest growing flavors in RTD tea and coffee launches (rank change), 2008- 2009 89
Table 3.34: Flavor groups share of RTD tea and coffee launches (%), 2008-2009 90
Table 3.35: Top 10 claims in bottled water launches (%), 2008-2009 91
Table 3.36: Top 10 claims in carbonates launches (%), 2008-2009 92
Table 3.37: Top 10 claims in concentrates launches (%), 2008-2009 93
Table 3.38: Top 10 claims in functional soft drinks launches (%), 2008-2009 94
Table 3.39: Top 10 claims in juices launches (%), 2008-2009 94
Table 3.40: Top 10 claims in RTD tea and coffee launches (%), 2008-2009 95
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