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Smart marketing policies and online retail are driving the US beverage market

The US beverage market is estimated to grow substantially in the years ahead, driven strategically by intelligent marketing strategies and online retail. Owing to the strong market potential, it has been predicted that the aggregate sales of the market would touch USD 667.5 billion in 2014, a marked 4.5% hike over the sales revenue of 2013 which was around USD 638.8 billion.

This report: Quarterly Beverage Tracker: USA highlights the current market scenario, key market drivers, and major challenges which threaten the market. It also provides a detailed insight on the market outlook, growth trend in the various product categories and key players.

Key market drivers

The US beverage industry is expected to grow in the next few years mainly due to the increasing number of private players that have appeared in the market. A noticeable trend employed by these players has been the use of unique marketing gimmicks to lure more consumers. It has also been observed that these private labels offer improved quality which helps create stronger brand loyalties amongst consumers. Consequently, the sales revenue of this segment is slated to continue growing throughout 2014, reaching USD 796 billion by 2018. In addition, the industry is also driven by the increased popularity of health drinks like fruit juices and milk amongst all age groups.

The increasing health consciousness among the US consumers has significantly redefined the beverage market statistics. Consumption of healthy beverages is also being encouraged by USDA or the U.S. Department of Agriculture, which has decided to ban all kinds of sugary drinks from vending machines, based in the public schools of this region and is instead offering fat-free milk. This popularity of healthy drinks has also boosted sports and energy drinks segment, which are being preferred by consumers these days, owing to their diverse flavors and nutritional value. Being low calorie in nature, bottled water is also expected to earn huge profits in 2014. Another factor which is encouraging the market is online retail, as numerous beverage brands are making attempts to grab more consumers by offering their products through online stores, particularly in the US hot drinks segment.


Key market players

Some of the dominant market players who have been witnessing a steady growth in this segment include Coca Cola, Gatorade Company Limited, Green Mountain Coffee Roasters Inc., Red Bull and many more. In a saturated marketspace, these companies are now trying to attract more consumers using novel marketing ploys. To cite an instance, Coca Cola, a leading US beverage brand is about to place 250 of the most popular first names of American teenagers on its label, replacing its own brand name in its 20-ounce bottles, along with several other such personalization gimmicks. The campaign is referred to as ‘Share a Coke’ and is an intelligent marketing tool to attract young consumers to the brand. Several other brands are also trying to implement such marketing techniques hoping to gain a larger share of the consumer base.


Market challenges

Though the market has been progressing steadily, the rising health consciousness amongst US consumers is checking the growth of the segment, especially among the soft drinks and carbonates. This is because of the high concentration of fructose and sugar levels in such beverages which are high in calorie content and are hence deemed unhealthy. Moreover, this product category is also considered to have reached its saturation point, further stagnating this segment which has been a significant contributor to the beverages market in the States.  


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