One of our 10 Things You Need To Know About… Soft Drinks

Brits’ love of coconut water shows no sign of slowing down as they knock back an additional 4.9 million litres [IRI 52 w/e 31 December 2016].

That’s a 26.8% increase in volume on value up 16%, adding a cool £8.7m to the market. Coconut water’s health credentials have helped, particularly as consumers look for lower sugar alternatives to juices and smoothies.

“Coconut water appeals to people wanting natural, nutritionally dense products, and it is typically 40%-60% lower in sugar than traditional juices and smoothies,” says Giles Brook, CEO of market leader Vita Coco.

However, the market leader took a hit on value partly because of growing price competition with newcomers Innocent and Naked. Vita Coco suffered a £1.7m loss while Innocent and Naked gained an extra £8.5 and £3.1m, respectively.

Brook says there’s still plenty more value to be unlocked, though. “If we can get to the same level of household penetration as not-from-concentrate juice, that alone is a £110m opportunity,” he adds.

The craft credentials of products in this space are increasingly important. Vita Coco’s premium sister brand Coco Community, for example, sources its products from Thailand. They are made with Nam Hom coconuts grown by Ratchaburi Province organic farmers in a community partnership.

But the pure stuff isn’t the only way to unlock this growth. Using coconut water or milk as an ingredient or base for juices and smoothies is becoming increasingly popular as well. Coldpress just entered the category with fruit-flavoured coconut waters, containing 25% less sugar than regular fruit juice. Savse, meanwhile, is using it as a base for two of its new protein smoothies.

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10 Things You Need To Know About... Soft Drinks