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Press Release: U.S. Liquid Refreshment Beverage Market Retail Dollars and Volume Growth Accelerated in 2018




Industry shows solid growth across established and emerging areas with all categories but fruit beverages growing in retail value

NEW YORK, NY, 15 May 2019: The U.S. liquid refreshment beverage market grew again in 2018, with retail sales increasing by 3.8% and volume by 2.2%, according to newly released preliminary data from Beverage Marketing Corporation. By both measures, the market grew faster than it had the year before. Specifically beverage-related factors, such as the enduring robustness of the sizeable bottled water segment, as well as more general ones, such as continuing economic growth, contributed to the overall increase in liquid refreshment beverage volume, which neared 33.9 billion gallons in 2018. In terms of retail sales, the market approached $180 billion, propelled both by the fast growth of small, niche segments as well as solid growth by bigger, established categories, including carbonated soft drinks. All but one segment of the liquid refreshment beverage market enlarged retail sales in 2018, with ready-to-drink coffee and tea, bottled water (conventional and value-added), energy drinks, sports drinks and carbonated soft drinks showing growth, and only fruit beverages declining.

Bottled water, which surpassed carbonated soft drinks to become the number-one beverage by volume in 2016, grew again in 2018 but at slower rates than in prior years. The category's essential qualities - healthful, natural, calorie-free and convenient - reliably appeal to U.S. consumers. Volume enlarged by almost 5% and retail sales advanced by more than 7%.

While smaller in retail size, niche segments once again outperformed most traditional mass-market ones. With regards to both volume and dollars, value-added water, energy drinks and ready-to-drink (RTD) coffee in particular moved forcefully in 2018. Indeed, value-added water outshined all other segments with a 15.5% increase in volume and a 16.6% increase in retail dollars. No other segment saw double-digit growth rates in either volume or dollars, but energy drinks and RTD coffee moved up with rates in the high single digits. Fruit beverages, in contrast, experienced contraction in both volume and dollars. Carbonated soft drinks' retail dollar sales grew by 2.4% even as volume declined slightly as beverage companies continued to downsize packages and introduce more no-sugar offerings in response to consumers' desire for less sugar.

Despite their growth, no energy drink, RTD coffee or value-added water brand ranked among the leading trademarks by volume. (No fruit beverage brand did either.)

Sports beverages, on the other hand, had Gatorade (including all brand variations) as the fifth largest liquid refreshment beverage trademark during the year with volume greater than 1 billion gallons.

Carbonated soft drinks continued to account for four of the five top beverage brands by volume. The rate of retail sales growth for carbonated soft drinks doubled from the prior year (up by 2.4% in 2018 compared to 1.2% in 2017) as pricing rose. Carbonated soft drink volume performance was essentially flat at 12.2 billion gallons - the category's best performance since 2005. Coca-Cola and Pepsi Cola retained their usual first and second positions among the 10 leading beverage trademarks in 2018, with Mountain Dew and Dr Pepper claiming third and fourth place. Coca-Cola and Dr Pepper both recorded modest volume growth during the year, while Sprite (ranked seventh) grew relatively quickly.

Bottled water had four entries among the leading trademarks in 2018, but only two of them grew, and they did so at rates slower than the overall liquid refreshment beverage category.

Four companies accounted for all of the leading refreshment beverage trademarks. PepsiCo had four brands. Coca-Cola had three while Nestlé Waters North America (NWNA) had two and the company that became Keurig Dr Pepper during the year had one.

"The beverage market's accelerating growth in both volume and retail sales is a noteworthy development in a rapidly changing industry," said Michael C. Bellas, chairman and CEO, Beverage Marketing Corporation. "The varied performance of the diverse segments, and the rapid growth of newer ones, is indicative of ongoing changes and beverage companies' adept responses to consumer demands."

New York City-based Beverage Marketing Corporation is the leading consulting, research and advisory services firm dedicated to the global beverage industry.


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