Innovation Leads to Ready-to-Drink Spirits Recovery – New Research Details Global Analysis

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Of late, the ready-to-drink (RTD) and ready-to-serve (RTS) drinks sector has suffered declining sales but, a recent research report suggests that increased and innovative product development will drive a new lease of life into the sector.

In the last year there has been a big increase in the amount of innovation around the RTS area. This has been marked by the arrival of new flavours and new packaging concepts.

According to this new research – published by just-drinks.com and including data from The IWSR – sales for RTD and RTS products declined by 2.8% in 2009 to 286.9m nine-litre cases from 2008. However, some markets saw a return to growth over 2008 figures. The US and UK were not included in the growth markets as they saw a compound annual decline between 2005 and 2008 of 8% and 5.7% respectively.

The negative image of underage drinking which resulted in advertising restrictions and punitive taxation is considered as the primary reason for the decline in sales.

The data within the report illustrates that the global RTD and RTS is turning a corner and there is “vast potential” within emerging markets. During the recession – in many countries – the level of at-home drinking increased as consumers switched to this from on-trade consumption. Companies are now tapping into this consumer trend via product innovation, with RTS cocktails and canned RTD cocktails representing a prime example.

“The pre-mix cocktail addresses both the growth of the cocktail culture and the shift in many markets towards take-home consumption since the onset of the recession,” the report states. “In the last year there has been a big increase in the amount of innovation around the RTS area. This has been marked by the arrival of new flavours and new packaging concepts."

A problem that seems to be prevalent to this sector is the association with younger drinkers. The backlash towards RTDs appears to have abated somewhat but, these products will always come under close scrutiny. This in turn creates a further problem for producers as the report states “If there is a weakness to the RTD sector it is that it suffers from what might be termed the ‘leaky bucket’ syndrome. Many newly legal-aged consumers enter the drinks sector through RTDs and then move on to full-strength spirits as their tastes mature. This means that RTD producers must continually recruit new drinkers.”

The full report from just-drinks and The IWSR is available via the just-drinks.com market research store. To browse the table of contents and detailed report description visit: http://www.just-drinks.com/market-research/global-ready-to-drink-rtd-and-ready-to-serve-rts-market-review_id92157.aspx?lk=pr

About just-drinks.com
Since 1999, just-drinks.com has provided the global beverage industry with the latest news, insight and intelligence. The just-drinks.com research store provides the latest market research across industry sectors. Including market reviews, forecast data, market trends, new product developments, latest trends and much more. The team of industry experts, analysts and journalists provide real-time news and comment on the latest industry developments.

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Chris Boaz
just-drinks.com
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