Free Drinks insists consumers have been trapped between ‘sugary sweet and water’ in adult soft drinks with little in-between, as it ramps up distribution of its ZEO brand across the UK in 2014.
Export director David Forson – who used to manage Britvic’s export business and helped build the firm’s successful kids’ drink brand Fruit Shoot, told delegates at Zenith International’s Innobev Global Soft Drinks Congress in Lisbon that consumers didn’t understand industry definitions of soft drinks.
“What is an adult soft drink for us? It’s mostly a lightly carbonated fruit-based product in a premium package, or mixers or premium mixer products,” Forson said.
“But consumers don’t actually understand that definition. They think Coke and Pepsi are actually adult drinks, as are premium juices in glass bottles offered by major soft drinks companies in most markets,” he added.
Consumer challenge around choice
82% of soft drinks in bars and restaurants are consumed by adults, Forson said, but he added that there is a current “challenge around choice”, with Mintel SDR 2013 data showing that 41% of soft drink consumers in these venues aren’t happy with the options available.
“66% would like to see a range of healthier options, and 50% want more premium drinks to choose from – therefore opportunities clearly lie in healthier, premium soft drinks,” he said.
Free Drinks first created its ZEO brand as an upmarket vodka that won success in West End, London bars and department stores such as Harvey Nichols but it has now developed into a soft drink.
“They key thing with ZEO is that the learnings came not from the world of soft drinks but from the world of spirits, it’s a product that fills a clear category gap between sweet-tasting soft drinks and water,” Forson said.
‘Our taste is different…but Guinness is a worldwide brand!’
So what of ZEO? Well it’s a low sugar low calorie (30-45 across three varieties) drink free from artificial ingredients, with a flavour derived from a secret blend of 32 fruits and botanicals, a crisp and dry taste (like wine) and a premium package.
Free Drinks is pitching it at ABC1 consumers willing to pay more for quality – Forson said HIM! research showed that 50% of consumers will pay more for a soft drink without additives or preservatives, while 46% will pay more for a low calorie option.
“Our taste is different, we understand that not all people will like it – some will always have a taste for sweeter-tasting drinks. We accept that. I’m an Irishman and I can’t believe there are people who don’t like Guinness, but it’s still a major worldwide brand,” Forson said.
Alcohol consumption is falling in Western markets, he noted - down 16% in the UK over the last eight years, while sugar and calorie levels in soft drinks are under pressure due to links to Type 2 diabetes and obesity.
“What consumers want as a real alternative to alcohol that tastes good and suits the occasion, is interesting and engaging and guilt free, i.e. it’s healthier and low in calories,” Forson said.
Tap water drains on-premise profits by $1bn
“What they actually get is sugary sweet or water. Also in UK bars and restaurants, the desire to avoid sugar or taking that second alcoholic drink is leading in an increase in requests for tap water rather than bottled water – this costs the UK on premise trade £1bn/year in lost revenue,” he added.
Insisting that consumers desired natural, low calorie soft drinks, and a wider choice thereof, Forson said Free Drinks wanted to “leap out of the adult fixture into the mainstream”.
“We’re starting to do so in the UK, with listings in leading retail and C-stores, and we’ll do the same internationally,” he added, stressing that ZEO would achieve nationwide UK distribution in 2014.
Free Drinks is part of New Idea investment group, a diversified investment group with a turnover of around $2.1bn in 2012/13.