According to Britvic’s annual Soft Drinks Report the total value of soft drinks in foodservice and licensed outlets was up 2.4% year-on-year in 2023, rising to £7.7bn.
Britvic managing director Paul Graham explained the category was “moving into the next chapter of Covid recovery” as consumer confidence was bolstered by “more predictable and manageable” levels of inflation.
The report showed the segment saw value growth of 1.4%, to £4.6bn, and 4%, to £3bn, in licensed outlets and foodservice outfits respectively last year.
However, licensed venues saw a 3.5% downturn in volume in 2023 while foodservice firms saw a 0.8% uptick.
Though weaker volumes did not necessarily mean bad new for operators, as 86% of consumers surveyed in the review said they felt good quality had a price and 73% were happy to pay more for higher quality.
Important factors
For pubs specifically, soft drinks grew by 0.4% last year, rising to £2.1bn, while restaurants saw a 0.3% rise to £837m.
In addition, more than half of pubgoers (52%) purchased a soft drink at a licensed outlet in 2023, an upswing of 2% compared with 2022.
Overall, the soft drinks category was worth £20.3bn across on and off trade channels last year, with a 6.5% positive change in value and 1.5% decrease in volume.
A reduction in the consumption of alcohol has helped soft drinks in on-trade settings, the report detailed, with 46% of consumers looking to consumer less alcohol in 2024 and one in three visits to pubs now alcohol free.
This is particularly true for younger drinks, with 63% of 18-24-year-olds “put off” visiting pubs and restaurants when there is not enough choice of low/no alcohol options, according to the data.
Families were another key market for the segment identified in the report while quality of food and drinks on offer was the important factor when deciding on a venue.
Sustainability also has its part to play in attracting people to the category, Britvic added.
The most popular soft drink choices in the on-trade proved to be still juice drinks, flavoured carbonates, pure juice, still water and energy drinks, though cola serves were the top pick.
Moreover, customers opting for tap water presented operators with an “£800m opportunity” to upsell by offering preimmunised health-focused drinks.
Britvic director of foodservice and licensed Adam Russell told the MA: “[The way customers are interacting with soft drinks in pubs] is going to impact range and choice and we are definitely seeing soft drinks get more space on menus across the board.
“I think soft drinks will also start to come into play around signature serves, which had probably previously been saved for alcohol brands.”
However, key dayparts had a big influence on consumers’ needs from soft drinks within the on-trade.
Innovative drinks
The data revealed between 12pm and 3pm most people desired serves like coffee, milkshakes, smoothies and house soda’s while from 3pm this changed to shandies, highball drinks and cocktails as well as house sodas and milkshakes.
Earlier this month Britvic introduced its new training platform to help upskill staff and share ideas on soft drink serves.
In addition, the Morning Advertiser (MA) this week launched its Low & No Project.
Britvic GB commercial director for hospitality Dino Labbate said the report “shined a light on the continued importance of value”, advising operators to “step up their efforts by investing in building digital loyalty” to stand out from the crowd and enhance customer’s experiences.
Labbate continued: “Our Soft Drinks Review 2024 emphasises the importance of focusing on innovative drinks menus to target spend growth.
“Exciting flavour innovations are proving especially important to win over Gen-Zers, who are more likely to buy new flavours.”
