Why CSDs are in need of a make-over

A global obesity crisis blamed on sugar. Discarded cans and bottles polluting the planet. Rising consumer interest in health and wellness. If it wasn’t for a global pandemic, carbonated soft drinks would be a likely candidate for public enemy number one in 2020.

Consumers’ interests have shifted significantly from the glory days of the late part of the 20th century, where the latest bright and fizzy beverage to catch on could enjoy huge success, and a ‘diet’ version was all you needed to cater for the health-conscious consumer. Over the last decade the industry has been battling an enormous growing backlash against high sugar levels and its use of single-use plastics. But things are headed for change, notes Emma Bowles, Global Marketing Manager at Treatt, the global ingredients manufacturer.

“It is a critical time for the category,” says Emma. “The challenges haven’t gone away, but innovation advances mean ambitious brands can enjoy success by truly understanding and responding smartly to market needs.

“Treatt has been around for over a century so we’ve been with the CSD industry through it all – our beverage partners trust us to create ingredients that help them meet regulatory obligations and, critically, hit that consumer sweet spot when it comes to flavour.”

Sweetness, of course, is a key hurdle for many brands who have long relied on a sugary base. The challenge facing every CSD is to reduce sugar usage but yet still meet consumer demand for something sweet. Reformulation in a bid to reduce calories is leading brands to introduce different ingredients, techniques and processes to compensate for losing the crutch of sugar. This has led to a revolution in the category as CSD brands introduce more of a ‘craft’ feel to their portfolio.

This premiumisation comes not just from the flavour but with consumers prioritizing naturalness and quality, authenticity is also important. Traditional ingredients and communicating provenance on pack are key to leveraging this trend and telling the brand story.

What about functionality? “Product claims in CSDs are nothing new but it’s now become commonplace for ingredient claims that benefit consumers health and wellbeing,” says Emma.

From vitamin-infused sparkling water to ginger lemonade designed to improve digestion, health-conscious consumers are drawn to products which support their lifestyle. This has been a necessary move as CSDs are under pressure from other functional beverages to create more sophisticated offerings. As younger generations turn away from alcohol, CSDs which excite and deliver on flavour are also ripe to steal market share from high-end alcohol brands.

When it comes to flavour, consumers aren’t prepared to compromise, says Emma. “If it doesn’t taste delicious and have the right ‘mouthfeel’, brands are heading for failure. Quality of ingredients is not just important, it’s essential.”

The ultimate marriage is quality and innovation, and brands should consider how to incorporate bold and adventurous flavour combinations into their portfolio. Emma says: “For CSDs looking to appeal to a younger audience, something new and different will be most attractive. For a more mainstream audience, a familiar flavour such as citrus can act as a ‘bridge’ when paired with a more unusual ingredient.”

There is much opportunity within the category to meet consumer need and succeed, but Emma urges brands not to get complacent. She says, “CSDs face a real challenge from the growth of sparkling and flavoured waters which can perhaps more easily tick the box of natural, low sugar and premium. We’re working closely and constantly with brands to ensure CSDs are in the best position to compete with products that deliver on experience and on flavour.”

Wellness is a broad movement, and is no longer constrained to a dramatic lifestyle change. A holistic approach has become a key motivator of consumer behavior, underpinned by convenience, transparency and value. Emma sums up: “Mass-market approaches still have value but we’re increasingly seeing the need for bespoke solutions that aim to fit the many disparate needs of consumers. It is incredibly exciting to see how brands are responding to this and the potential that lies ahead.”

To find out more about global ingredients manufacturer Treatt, visit treatt.com.