Trends in the Beverage Market in 2015

    Since 2001, the beverage market in China has maintained double-digit growth for 13 years. However, in 2013, the high growth rate of the beverage industry was clearly slowing down, with data showing that the Chinese beverage industry grew by 13.61% in 2013. Although the performance was still acceptable, the growth rate was lower than in previous years. And in 2014, the beverage industry faced an even more challenging situation, with the industry referring to 2014 as the "small year" for the beverage industry.

    According to media reports, at the 2015 sales work conference held by Wahaha Group, Zong Qinghou admitted that 2014 was one of the worst years for sales performance in recent years, with a 7% overall sales decline. Meanwhile, a notice from Conshifu showed that its beverage business segment experienced a 19.95% year-on-year decline in revenue in the third quarter. According to statistics, Conshifu's instant noodle business revenue has shown year-on-year growth since 2010, but this trend was reversed in the third quarter, with the first year-on-year decline in five years. According to an insider from Uni-President, the company will focus on quality-driven sales growth in 2015, and abandon growth expansion of unprofitable businesses.
The beverage market had a "small year" in 2014, with growth declining for industry leaders and primarily due to the challenging economic and consumption environment, coupled with the fact that there was more rainy weather in the summer of 2014, which resulted in a poor market situation. In such a changing environment, what will be the trends for the Chinese beverage market in 2015? What products should distributors and manufacturers choose to distribute and produce?
Specifications:
    Smaller sized products will become more prevalent, especially in the 200-300ML aluminum can market.
    The beverage industry has experienced rapid growth over the years, resulting in the accumulation of many classic products and brands. In terms of packaging specifications, PET packaging of around 500ML, 1L or more sharing pack products, and 310ML aluminum can products dominate the market. In addition, some products packaged in Tetra Pak, a material and size different from the above, fill the market gap.
    For packaging specifications, many companies base their choices on those of others. Packaging strategy is an important component of a company's product strategy. When Wong Laoji started out, it mainly made 310ML aluminum cans, while He Qizheng differentiated itself by offering 600ML PET bottles. They quickly captured a portion of the market. Now continuing to use larger cans, they actually hope to differentiate themselves in packaging.
     However, from the overall trend of beverage development, the future development of beverages in China will be more towards smaller packaging sizes. This is mainly because consumers are transitioning from a consumption focus on meeting basic needs to a focus on quality, especially for urban consumers. More and more, small and beautiful products will win their attention. With a 500ML maximum packaging size, most of the new products launched on the market are below 500ML, which meets the needs of an increasing number of quality-conscious consumers. This also makes it easier to express the quality and value of the brand.
      The mainstream products include Nestle coffee and Uni-President milk tea, which have become a small but beautiful scenery line in the market. The product prices are not low, and the consumer loyalty is also high. In the future, from the form, small-sized aluminum can products will be one of the directions for product development, such as Eagle Pioneer ginseng drink.
Taste:
    The light-tasting beverage market, especially the light functional beverage market, has a bright future.
There are many flavors in the beverage market, mainly depending on the product category and ingredients. Juice is sweet and thick, green tea is refreshing, cola is crisp, herbal tea has a plant-based taste, plant-based protein drinks are rich, and coffee is smooth and fragrant... The growth of each product category is based on its taste, so why emphasize taste? Because the success or failure of beverage sales is largely determined by the taste of the product.
    From the hot-selling products on the market at present, Danone Isotonix, as a representative of vitamin drinks, is actually a light-tasting product. In a strict sense, it is a mineral water with a vitamin flavor, which is more flavorful than water but not as sticky as juice. With the functional appeal, it has driven the Isotonix market to reach a scale of 10 billion yuan in just a few years. Without this difference in taste and the functional appeal of the blue hat, it would be difficult to launch such a huge market scale. Under the drive of Isotonix, this light-tasting and light-functional beverage is gradually becoming an important force, and it seems to be ready to compete with herbal tea and plant protein drinks.
Besides the pulse, Coca-Cola also launched its own Hydropulse product, while Uni-President introduced its Oishii product. Many other companies launched light-flavored products such as lemon and mint in 2014, and the market was a success. It is expected that light-flavored and light-functional beverages will continue to experience rapid growth in 2015. This meets people's demand for buying drinks to quench their thirst in summer, as well as young people's pursuit of rich flavors.
Category:
    Small niche beverage markets have great potential for gold mining, especially in the mushroom and loquat markets.
    Currently, the main drink categories in China are carbonated drinks, fruit juice, plant protein drinks, tea drinks, milk drinks, and herbal drinks, and the category structure has been formed. Carbonated drinks are represented by Coca-Cola and Pepsi, and other companies have no chance. In the fruit juice market, Huiyuan is the sole leader, and the rest are small grasses. In the herbal tea market, Wang Laoji and Jia Duobao are the two tigers, and other companies have no chance. In the tea drinks market, Master Kong and Uni-President are the two strong competitors, and other companies have no chance. In the milk drinks market, Hahaha is the sole leader, and other brands are unremarkable. In the plant protein drinks market, Liu Liang, Luolu and Yeye Island are in a three-way tie, occupying their respective market segments, and other companies can only engage in guerrilla warfare. In fact, there are not many clean growth spaces left for Chinese beverage companies, and the white-hot competition in category has made it increasingly difficult for the market to differentiate between categories.
    In the face of such a clear competitive landscape, it is very difficult for enterprises to make breakthroughs. In order for Chinese beverages to maintain high-speed growth, they must break through in order to take over the baton of the high-speed development of walnut milk products. What other product categories have the potential to create a billion-dollar market in the current situation?
From the overall market development, the niche beverage market has huge potential for future gold mining. In the trend of large market and large categories, the niche market is currently the high ground for market gold mining. In 2015, niche specialty beverages will have a large development space because the big brands are experiencing weak growth and the large categories are showing lack of momentum. Therefore, the unique features and value of niche specialty beverages will become more prominent. For example, since 2013, Zhen Tian Loquat Beverage has emerged from the entire beverage market and has become the representative of PM2.5 era lung nourishing beverage, gaining market attention and pursuit, with unlimited prospects. From the perspective of raw materials, the niche beverage market in China, the mushroom beverage market will have a brand breakthrough in the future. The popularity of Zhongji Gongji Spread and Jiangzhong Hougu Pock饼 has laid the groundwork for the cognitive space of mushroom beverages. And the polysaccharides in mushrooms are also expensive raw materials for expensive pharmaceutical products, so the development space in the future is huge. The launch of Jiangzhong Hougu Beverage in 2015 is just the beginning.

Price:
The retail price of 4-5 yuan will be consolidated, especially the 4 yuan price segment market.
The Chinese beverage market has evolved from the 2-yuan era to the 3-yuan era, with 2-yuan products currently dominated by carbonated drinks and tea beverages, while 3-yuan products are occupied by juice and various plant-based beverages. Under the influence of market competition, inflation, and rising labor costs, the market is currently moving towards the 4-yuan price range. More and more products will be competing in the 4-yuan price range, and in the future, bottled beverages will compete around the 4-yuan price range.
    It is foreseeable that after entering 2015, the development and birth of various new drinks will have their price range between 4-5 yuan. Otherwise, the products will have no operational and development space, and will not have an advantage in market competition. When the scale of new products is insufficient, they can only survive by waging a value war, otherwise, the price war will only make them the victims of the price grinder of major brands. In fact, it is also a matter of choosing between value and price strategies, which is decided by the strategy and resources of the enterprise, not arbitrarily decided.
For example, the retail price of the Sanada Kiwi Drink when it entered the market was set at 4 yuan, while the Uni-President Tea Drink was more expensive. In the future, there will be no value in market competition, and all products that fail to meet market needs will be eliminated.
   China, entering the mature consumer market, values the choice of priorities. Price wars are no longer the need of Chinese enterprises in the brand era, and value wars are the soul of the future market.
Therefore, from the entire Chinese beverage market at present, the decline of traditional carbonated drinks is irreversible, and the dominance of protein drinks is unlikely to form a major trend. Traditional herbal tea drinks have no chance at all, while the remaining dairy drinks and tea drinks need to maintain their growth through brand and product innovation. The high-speed growth of Chinese beverages in the future will rely on value-based competition to undergo transformation, and companies can only innovate to achieve unlimited possibilities.