How metal packaging is making a splash in the new drinks categories
marketing & business development director at Crown Bevcan Europe & Middle East
The beverage market of today is continuing to evolve at an accelerated rate due to the COVID pandemic. Just a few short years ago, the industry looked considerably different to what we see today, with new and exciting drinks concepts breaking through with increasing levels of success - provided they meet the stringent criteria of today’s more well-informed consumer base.
Elements such as health & wellness are more important than ever before, particularly in light of the pandemic, which has further focused the minds of the consumer on their own wellbeing. Other trends include the sustainability of the products they buy as well as new ways of consuming at home via e-commerce platforms.
Main image: Jordan Perata, Kilo
Healthy drinks - In the driver’s seat
Where consumer demand for products that contribute directly to their wellbeing is concerned, flavoured and enhanced waters, kombucha and iced teas continue to deliver beverage options across a wide range of demographics. Another segment that is seeing major growth is functional beverages. Some of these may be defined as delivering tangible health benefits and improving energy levels.
Some also claim to help alleviate stress, aid rest and improve mental health. Functional waters, for example, are enhanced through the addition of vitamins, minerals, fruits or vegetables to deliver a wide range of perceived health benefits. Between 2020 and 2025, this market alone is set to achieve a CAGR of 7.9% in the EMEA region, and many major brand owners are seeking entry, either through M&A or by launching new offerings themselves. Given the huge focus on this area globally, there is a high chance that these products will become increasingly popular in the European market.
The mindfulness element is clearly having an impact on how people consume drinks, and this is particularly the case where alcohol is concerned. The non-alcoholic market is burgeoning and is predicted to grow at a CAGR of 4.95% out to 2025 in sales terms. One brand that is leading the charge in new beverage options is Seedlip, which has pioneered an entirely new drinks category with its non-alcoholic distillates.
Seedlip offers a flavourful and sophisticated alternative to spirits such as gin or vodka, and the company recently partnered with Crown to launch its RTD Seedlip and tonic cocktails in 25cl cans - a design that became a finalist at the Luxury Packaging Awards in late-2020.
Today, more brands are seeking to offer more complex non-alcoholic alternatives, and the number of new products is flourishing.
The non-alcoholic beer category has also seen incredible growth, with the European market expected to reach a value of around US$6bn by 2024. Companies such as craft brewer Brewdog have embraced the trend. Brewdog now produces alcohol-free versions of its iconic Punk IPA as well as Lost Lager, and Nanny State. Today, it is rare for major beer brands not to have an alcohol-free option and the vast majority are available in cans. They are a convenient format for online shopping due to their robustness, provide good volume levels for sharing opportunities in the home, and also ensure the product reaches the consumer in the condition the brewer intended, thanks to superior barrier qualities against both light and oxygen.
Elsewhere, the US hard seltzer trend is reaching countries such as the UK and is slowly making its presence felt across Europe. Often low in alcohol, they are also low in calories – which appeals to the health-conscious consumer looking to enjoy something different, outside of soft drinks - and many are suitable for a vegan diet, making them accessible to all of legal drinking age.
New categories, new formats
Packaging, of course, is a key element in the overall picture, and growth is steady. Many new categories are utilising metal packaging, with its versatility in terms of forms and sizes. Some of these new products are transforming the landscape as great alternatives for health-conscious consumers. From flavoured and enhanced waters to natural tonics, alcohol-free beers and Ready-to-Drink products (RTD) - all are gaining a foothold.
Despite a period of uncertainty brought about by the pandemic, beverage cans have experienced a year of strength and appreciation, both in Europe and beyond. There is currently an estimated global demand of more than 350bn units, solidifying the can’s position as the preferred format in both established and emerging markets. In North America alone, current growth rates are tracking above 6% - nearly double the rate between 2018 and 2019, while all European markets have also seen their can consumption booming. Between now and 2025, GlobalData is predicting the consumption in units of beverage cans in Europe and Middle East to grow at a CAGR of 3.5%.
The COVID pandemic has certainly had a part to play in this growth, particularly as consumers look to packaging that is sustainable but also provides a hermetic seal to external elements, which makes the products shelf-stable and extends their storage times.
There are three key areas of focus that are leading brands to select metal packaging as a preferred option both today and in the future.
Changing times and lifestyles drive new consumption habits
A sharper focus on mindfulness today dictates that brands must consider every element of a product carefully - from its source ingredients to its packaging. Due to the current climate, consumers are spending most of their time at home, and many are becoming more focused on the environmental impact of the products they buy and their overall lifestyles. A healthy product packaged in an unsustainable packaging option is unlikely to appeal to a large swathe of consumers, so metal continues to be the go-to option, given its ability to more than tick the sustainability box.
As a result, metal remains the first choice for many brands looking for a dependable, multi-faceted packaging option, with unrivalled sustainability credentials, infinitely recyclable with zero loss of properties, and back on the shelves in as little as 60 days, regardless of design and ink selection. The increasing concerns over sustainability are even shaking some aspects of categories that were well-established in different formats. Basic products such as packaged water, have been increasingly switching to cans in recent years, as metal packaging helps brands stay on track with their commitments to the environment.
Italian water brand WAMI, for example, has added a twist on this approach, aiming to turn the ordinary act of drinking water into something extraordinary by providing 100 litres of water to people who lack access to clean water every time a product is purchased.
Entering the market in July 2020, WAMI water is available in 0.44cl aluminium cans. A QR code, which is integrated into the can’s design and decoration, enables consumers to discover precise details of where their contribution has made a difference - sometimes identifying the individual family that received the water.
Cans – A given in our daily lives
For those looking to consume beverages on-the-go or out-of-home, cans are ideal as they offer convenience and robustness while keeping the beverage chilled for longer. This trend has been driven by the faster-paced lifestyles of the younger generations. In Turkey, cold coffee started to gain ground with younger consumers in the mid-2000s, with the arrival of international retail chains. These retailers experienced fast growth, encouraging Turkish brands to expand their own portfolios to capitalise on the trend. Today, it is estimated that the local coffee market is being driven by over 61 multiple retailers.
While on-the-go experiences were stymied by COVID in 2020, the functionality and convenience elements will continue to remain a strong focus going forward, as many of the benefits enjoyed by consumers on the go can also apply in the home. Portion control is also important when applied to health & wellness, while those working from home may choose coffee in a can for an energy boost during the day.
Regardless of the current global situation, the beverage sector continues to expand and diversify through new and exciting sub-categories, and brands looking to strike the perfect balance in terms of packaging continue to select metal as the best all-round solution. Knowledgeable consumers are demanding far more than simply great tasting beverages, and metal packaging’s ability to deliver effortless sustainability, design flexibility and on-the-go convenience chimes well with the 21st-Century lifestyle.