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SPECIAL REPORTS

Consumers switching from fruit-based beverages to fruit juices
Wednesday, 28 April, 2021, 08 : 00 AM [IST]
Karan Chechi
India packaged juice market has a size of approximately $357 million as of FY2020. The beverages are divided into two categories: alcoholic and non-alcoholic, with non-alcoholic beverages further divided into carbonated and non-carbonated. Non-carbonated beverages include iced tea, sweetened coffee, flavoured milk, canned fruit juices, and so on. In India, packaged juices have experienced growth in demand in recent years. Consumption of alcohol has increased the risk of liver diseases such as fat in the liver and inflammation of the liver, affecting the health of people. This generates a huge demand for juices and nutritious drinks due to rapidly shifting preference towards a healthy lifestyle. Increasing population, rising disposable income, and growing trend towards healthy eating are the major drivers that influence the demand for packaged juices. Growing urban population has driven the consumption of packaged juices, also, shifting towards healthy eating alternatives in rural areas, has led to the rising sales of packaged juices in India. Consumers are switching from fruit-based beverages to fruit juices because they believe the latter is a healthier breakfast choice. Rising income levels of the consumers also prompted them to try a variety of fruit juices before deciding on their favorites for future consumption. 

Challenges
The rising incidences of lifestyle diseases have prompted Indian consumers to reconsider their eating habits. According to the World Health Organization, non-communicable diseases such as cancer, diabetes, and heart disease cause over 5.8 million deaths in India each year. High sugar content in packaged juices, coupled with the increase in health problems such as diabetes and obesity, are some of the challenges that hamper the growth of the India packaged juice industry. To solve this issue, manufacturers are coming up with low-calorie, sugar-free, non-alcoholic drinks and fruit juices. In 2020, Dabur along with Tetra Pak, launched a low-calorie juice range under the brand, Real Activ. According to the business head (foods) at Dabur India, the Real Activ low calorie range will attract fitness enthusiasts and health-conscious customers and the creative packaging will improve the product’s reputation. As part of its ‘Delightful Fruit Nutrition’ category, Coca-Cola India has announced the launch of two new products under its 13-year-old brand Minute Maid: Vita Punch and Nutri Force. The two goods rolled out on August 15, 2020, which are considered fruit juice-based drinks. Though Coca-Cola India claims that Vita Punch can fulfil 100 percent of daily vitamin C requirements, the Nutri Force juice comes with soluble iron and claims to boost the cognitive capacity of children. Factors such as changing eating habits, easy availability and consumption, and convenience, have further boosted the growth of the industry. 

Sustainability
Single-use packaging is a major driving factor in the packaged juice industry. Juices are only safer if they are prepared in a hygienic manner. Juices from well-known brands have typically been packaged and certified to meet the health and safety standards. The current Indian government has suggested and proposed that all Indian beverage companies provide at least 2% fruit content in their beverages, to give them a nutritive boost while also benefiting Indian farmers who are involved in the agri fruits industry. Another emerging trend in the India packaged juice industry, which has gained traction on a global scale, is sustainability. 

International beverage companies including Naked Juice, Nestlé Waters, and Snapple are making the transition to more sustainable packaging by using recycled polyethylene terephthalate (PET). Packaged juice industry in India is expected to benefit from the increased use of biomaterials and environmentally friendly products in juice packaging. 

Reshaping strategies
In June 2019, India’s packaged juice market reported its steepest decline, with consumers opting for lower priced beverages such as soft drinks and milk-based drinks. High cost of products, and intensified competition are also the factors contributing to the market's decline. The packaged juice industry in India was estimated around $357 million in 2020. During the Covid-19 lockdown, the world faced an economic slowdown, which significantly impacted all the manufacturing industries. Thus, the demand for non-alcoholic drinks significantly reduced in 2020, although the sales post lockdown gradually recovered. The packaged juice companies are reshaping their strategies to promote the consumption of packaged juices. 

People all over the world want juices and nectars to be as fresh as possible, with fewer calories in it. Consumer tastes have shifted dramatically from aerated beverages towards packaged juices in the recent years. A growing number of stakeholders are paving their way through the Indian market for packaged juices, sensing the lucrativeness of the fruit-based beverage sector of the country. Manufacturers are attempting to combine the best raw materials with creative product packaging and are trying to introduce new products in fitness, wellbeing and immunity boosting segments. In order to expand the consumer-base, manufacturers are introducing a wide array of flavours, and producing preservative-free fruit juices. In addition to this, growth in the food and beverage industry is boosting the overall demand for fruit juices worldwide. Top brands are increasing their nationwide penetration and securing a stronger position in the India packaged juice market by implementing creative strategies such as celebrity endorsement or introducing new sub-brands and flavours.

New consumption pattern
According to the studies, the small pack sized juices are the most commonly consumed as they are convenient to carry and consume. They have a consistent taste and no specific requirements for storage, making them a convenient option. As outdoor consumption grows, these are in high demand. Family pack fruit juices have carved out a place for themselves on family menus as part of breakfast, social events, and evening snacks. As a result, customers are increasingly purchasing several family packs at once, which is a new consumption pattern.  

In India, a large portion of the population lives in villages, where mid- to low-cost packaged juice items are expected to gain traction in the near future. Leading players in the India packaged juice industry, such as PepsiCo India and Dabur India Ltd, are attempting to gain traction in Tier II and Tier III markets by implementing new marketing strategies. Some of the leading companies in the packaged juice market in India are PepsiCo, Inc. (Tropicana), Dabur India Ltd (Real Fruit), ITC Limited (B-Natural), and Hector Beverages Private Limited (Paper Boat). PepsiCo India is also concentrating on leveraging the country's expanding opportunities. As domestic and foreign brands recognise the lucrativeness of the India packaged juice market, it is expected to see rising trends in the coming years.  

(The author is research director for TechSci Research. He can be reached at sales@techsciresearch.com)
 
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