The beverage industry’s busiest season is almost here. As the industry gears up for increased customer demand for their favourites, there is also an unquenchable thirst for new varieties and lots of choice for different occasions. Australian Beverages Council (ABCL) CEO Geoff Parker provides an update.
Across the drinks industry we’ve seen a range of innovative new products coming to market, and some new drink trends emerging.
The rise of low and no sugar options continues at pace, with unsweetened waters driving a lot of that growth and all drinks today are packaged in wonderfully recyclable containers, with a rising number containing recycled content.
Industry initiatives
Beverage companies continue to deliver initiatives to meet the expectations of a broad range of stakeholders in a unified approach that goes beyond individual brands.
While companies launching their own pledges or commitments will continue to be important, our research found consumers expect competitors to unite to tackle society-wide issues like obesity or environmental sustainability.
At Drinks HQ, there has been a raft of launches for both existing and new initiatives including recasting the Sugar Reduction Pledge – Australia’s only voluntary reduction commitment – from a 20 to 25 per cent reduction by 2025.
The flagship Environmental Sustainability Roadmap to 2030 (ESR30) was launched by federal Minister for the Environment and Water, Tanya Plibersek, and Clean Up Australia chair, Pip Kiernan. And DrinkFacts, the drinks industry’s social media campaign to help Australians make informed drink choices was also rolled out.
The bottled water industry recently embedded sustainability as a third pillar of the ABCL’s Bottled Water Model Code under its Australasian Bottled Water Institute (ABWI). State and territory governments are recognising that ABWI certification is the sustainability benchmark consumers and communities expect.
Portfolio innovation
This year saw the continued innovation in the no sugar space. Data shows that for nearly 25 years, consumers who want to manage their sugar intake have increasingly been moving to low and no sugar drinks and manufacturers have been meeting that demand with a broad range of drinks, taste profiles and sustainable packaging options.
Flavour is the future and drinks manufacturers have innovated to make lower sugar varieties that taste almost identical to their regular sugar counterparts – a feature of the drinks industry that no other sector in the supermarket can offer.
Beyond low and no we’ve also seen the rise of new waters like alkaline water – beloved by the gym crowd and water infused with a dash of fruit for those who want a change from plain water. Water with gut health and immunity boosting properties are on the rise, and consumers are seeking out drinks with health benefits more and more while keeping a brand’s sustainability credentials to the fore.
Water continues to enjoy strong growth and Australians are buying more bottled water than ever before, with volume sales growing by around 11 per cent each year. We know that industry certified bottled water brands lead the world in sustainable water stewardship, which continues to be a hot issue, particularly in areas where extraction is a community issue.
Sometimes innovation can go too far. The arrival of a particular energy drink in April, which soon became a status symbol for school-aged children is a case in point. The product never conformed to the Food Standards Code (FSC) and the government moved quickly to take it off shelves and have it stopped at borders. However, it raised interest in energy drinks and shone a light on the nation’s energy drink manufacturers who are playing by the rules, not only from a FSC perspective but also through compliance with the ABCL’s Energy Drinks Commitments. These include not marketing to children nor allowing these types of drinks to be sold in any schools – primary or secondary.
Beyond sugar reduction and water stewardship, we are witnessing the sustained power of juice with no added sugar in the diet. A recent abstract, presented to the annual dietitians’ conference, shows huge health benefits of juice’s bioactives in a balanced diet. We look forward to that paper being published so that consumers, government, and health researchers can learn from this data and look beyond the sugar content from the originating piece of fruit.
Sustainability always on
Beyond our efforts as product stewards to recover our containers through an almost nationwide set of container deposit/refund schemes (CDS), we’ve seen a rise in recycled content in packaging, especially since significant investments in domestic PET recycling by the nation’s two largest bottlers – Coca-Cola Europacific Partners and Asahi Lifestyle Beverages – along with their partners PACT Group and Cleanaway.
Our industry wants to put more recycled content in our containers and is looking to have that content domestically available, ensuring our investments to recover it via CDS will be returned with our sector being able to access enough recycled material that it needs. We’re also exploring discussions to expand the scope of CDS-eligible containers to ensure these schemes are the engine rooms of a circular economy in Australia.
Internationally, Australia has stepped up as a key supporter of the UN global plastics treaty. We are working with the government and directly with the UN to ensure the treaty lands in a pragmatic but ambitious place to help reach the goal of ending plastic pollution by 2040.
The packaging reforms currently being discussed will no doubt drive all industries’ circularity agenda, but it is critical this is done in a measured, controlled, and sustainable way to ensure all sized companies can meet the expectations of any future legislation without compromising profitability at best or viability at worst.
It would be remiss of me not to mention that industry should be allowed to innovate in this space with confidence and without fear of punitive measures being imposed by regulators like the ACCC.
The ABCL is all for claims to be substantiated to avoid greenwashing, but the pendulum is still swinging and hasn’t quite landed in a sweet spot just yet. Any overreach will have unintended consequences and all industry is asking for is a level playing field and an opportunity to work through some of the ambiguity with the regulators to ensure pragmatic, commonsense outcomes that meet the needs of consumers, companies and governments.
Finally, the best indicator of the health of our industry is the rise of many new niche drink companies and brands, and the continued growth of existing brands, all with new and interesting drinks constantly coming to market which more and more are offering both health and planetary benefits.
This article first appeared in the October/November edition of Food & Drink Business magazine.
