Friday, March 20, 2020

Adjacent beverages and the preferences of the new generation

In April 2018, research and information company Nielsen Holdings published a survey based on 2017 data that pointed to a 1.7% drop in total beer sales in Brazil. Still, in a country recognized for its appreciation of the beverage, the total revenue of the beer industries grew 1.6% that same year, when there was also an increase in the number of national craft breweries: 37.7% more establishments than in the previous year. This year, the market is already pointing to growth between 1.5% and 2%, which signals a recovery, even with the Brazilian economy still stagnant. The way young people consume beverages – in Brazil and around the world – is changing, but in each place in a different way. Countries such as Italy and France, for example, are markets with a strong presence of drinks such as wine and cider, but which have now opened up more space for beer consumption, much because of their young population. The first phase of generation Z, that of those born from the late 1990s to the early 2000s, is made up of consumers different from those we knew until then. If millennials, who are now between 25 and 38 years old, were looking for craft and premium beers – helping to create a market that today grows by 2 to 3 digits annually – the new customers of now – that is, generation Z – arrive looking for even more differentiated alternatives. More elaborate, premium, brand-oriented, special or handcrafted beverages that talk to the lifestyle they have or aspire to have are crucial factors for these new customers to choose products. For this audience, the concept of the product and the history of the brand can be decisive factors at the time of purchase, as well as the sustainability linked to it. In this sense, packaging can be a crucial part of the final solution, which needs to consider and consider all these factors. Glass bottled beverages, for example, have a great appeal to those who seek these complete solutions, while deserving the conservation of taste and original characteristics. The public looking for more elaborate beverages wants just that: a quality product that also has in the packaging the concern with the preservation of the original characteristics, the taste of the drink, how it is made, placing it as the protagonist and not as a mere accompaniment in a moment of leisure. The choice of more refined products also brings another factor: the way of consuming alcoholic beverages is no longer linked to juvenile transgression; alcohol consumption is not guided by exaggeration. Generation Z is more aware of the evils that excess alcohol brings, and is also much more concerned with physical appearance. With this, another wave appears as another alternative for these newbies, but demanding, consumers: the market for adjacent beverages. They are alcoholic and non-alcoholic beverages that come in their most varied forms: healthier versions, with fewer calories, low alcohol content, flavored, mixed, with different fermentations, lighter or even versions with a slightly higher alcohol content, but that are consumed sparingly or on occasions different from those in which traditional beers are consumed. These and other factors that talk to these young people's concern so about maintaining a lifestyle more focused on well-being and body care are increasingly present in beers launched in mature markets, such as in the U.S. and countries in Europe and Asia. There is a wide variety of release appeals, the most common being: gluten-free, sugar-free, organic, natural/preservative-free, alcohol-free, no/low calories or low carbohydrates. These attributes are usually tied to other more usual ones in the beer category, such as seasonal product appeal and limited edition, which many manufacturers use to test new ideas for a while and include in the portfolio if acceptance is more perennial. Although all these attributes integrate the same trend, there are specific attributes being worked on more in each region, so the potential is enormous if we consider what is happening in all regions. The arrival of this new type of drink in Brazil – of which Ambev's Skol Beats is a good example – has already been happening and demonstrates the growth space that exists in the sector. They are new options on the shelves that should not replace the most popular and traditional drinks or the already consolidated market of special and premium beers, but that will give these new consumers drinks that celebrate their lifestyle. There's room to serve everyone.
ABRE - 02/03/2020 News Item translated automatically
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