Beverage Industry
It will be interesting for those in the beverage industry to see what products thrive in the present economic economy and which do not fare as well. We have all heard and read the stories and reports of consumers cutting back, tightening purse strings and embracing thrift. We’ve also heard that some consumer products seem to be “recession proof”, and they are not necessarily the products we expect to see in this category. Candy, for instance, falls into this group of consumer goods that has not historically been affected by economic downturns.
Candy is certainly not a necessity for any consumer. It is clearly a luxury item. So, why wouldn’t budget minded consumers make candy one of the first items to cross off the shopping list? The answer is that candy does not often even make the shopping list. It is an impulse buy and something many shoppers choose to “treat” themselves or their family. So, the candy bars are flying off the shelves but the high-end candy in the elaborate packaging candy is not.
It seems that beverages will fall into the candy category in an economic downturn also. Consumers will look for known and trusted brands that make them feel good for a reasonable price. They probably will not be looking to cut their usual soda and iced tea purchases out of the budget because these items are little luxuries that they will want to hold onto.
They will even be eager to try new beverages that fit into their sense of appropriateness. Consumers will want something special as long as it is not too flashy. The beverage industry will need to adapt to this new consumer and create packaging and colors that are unique and tempting but not showy. As always, the beverage industry will need to rely heavily on market research to discover just how much pampering consumers in various demographics are allowing themselves.
The brands that have branded themselves as higher end, luxury beverages will not fare as well. Conspicuous consumption is no longer in vogue so we will see fewer purchases in the beverage industry of “designer” drinks and more sales of luxury drinks that don’t display too much glam. Premium brand manufacturers in the beverage industry will need to seize this situation by providing consumers with what they want but not overdoing it. Consumers will be foregoing expensive vacations and trendy clothing but they will still want little luxuries to remind them of how it felt to feel pampered.
Keeping this consumer in mind, along with other trends in the marketplace will be challenging to the beverage industry. Manufacturers will need to show innovation and a true understanding of their target consumers and the emotional purchases those consumers will be making in this economic climate. Premium buying customers are still buying but they are thinking more about their purchases. Consumers want to feel good about how they are spending their dollars. Those in the beverage industry can use this as an opportunity to increase sales if they make the right decisions on branding, packaging and marketing.
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