19 September 2016
By Chris Gretchko, Vice President of Marketing for Tetra Pak, U.S. and Canada

Today’s global juice industry is more dynamic than ever. From traditional fruit juice to vegetables and herbs, the opportunities opening up are huge as consumers seek tasty, healthy and natural juice options. And driven by creativity, innovation and a more nuanced understanding of developed and emerging markets, companies are responding.

I’m excited to share some key findings from our latest Tetra Pak Index, which for the first time is focused entirely on juice. While the overall results focus on the global 100 percent juice category, the data offers some compelling opportunities for companies in the United States and Canada looking to take their 100 percent juice game to the next level.

Breakfast is a juicy opportunity

Overall, the U.S. is by far the biggest market we examined in the Juice Index, with 6.7 billion liters of 100 percent juice consumed in 2015 – more than the next five markets combined.

While our Juice Index found that more than half of all Americans (55 percent) drink some type of 100 percent juice at breakfast, one particular juice is not squeezing out profits like it once did: orange juice.

OJ consumption in the U.S. continues to plummet for a variety of reasons, including an overall decline in fruit consumption, and consumers’ health concerns about sugar content resulting from more transparency in labeling. In the past four years, orange juice sales have fallen 13 percent, according to Nielsen. Juice companies finding themselves losing market share due to sugar concerns can consider underscoring that any sugar content is naturally occurring and extoling the health benefits of 100 percent juice on their labels.

Fortunately, other drinks to start consumers’ days are filling the gap and actually have room to grow, such as by providing more convenient, single-serve re-sealable packs. And other trends like juicing raw fruits and vegetables have meant alternative juices and smoothies are seeing relative success.

A shift in breakfast eating habits among consumers who increasingly have a preference for more on-the-go options, like ready-to-drink breakfast meals and high-protein drinks, is another key finding. Analyst firm The NPD Group expects “breakfast occasions” – a time to eat breakfasts and morning snacks either in or away from home – will grow by five percent through 2019.

“Premiumization” is rising to the top

The strongest growth in 100 percent juice is at the highest end on the market. We found that consumers are prepared to pay more for natural products that promote good health. As part of our research for the Juice Index, we discovered that many consumers are willing to spend a premium on natural, less processed juice – particularly if it meets their health and wellness needs.

Consider this: the premium 100 percent juice segment now starts at $7 per liter. While this could present brands with a compelling opportunity to capture higher profit margins, higher cost of premium ingredients could impact the bottom line.

Several market trends support this conclusion. As detailed in our Juice Index, not from concentrate (NFC) is gaining share from reconstituted, up from 25.6 percent in 2009 to 28.9 percent in 2015, according to Euromonitor.  Global average prices per liter for reconstituted juice, meanwhile declined by 0.3 percent, while NFC prices grew at one percent.


Constant innovation is shaking up the market

Heralded by the incredible success of coconut water, new segments, recipes and brands are keeping 100 percent juice options at the fore of innovation with consumers.  With coconut water now mainstream, what’s next in 100 percent juice?

Our Juice Index found that while orange (46 percent) and apple (17 percent) juices still dominate the market, sales are declining. Things like mixed fruit (six percent) and mixed vegetable juices (four percent), meanwhile, have risen to become the fourth and fifth most popular 100 percent juices among consumers, suggesting that new and unique flavor combinations are important components of juice’s continued trajectory of success.

Already, we’re seeing an array of new plant-based products that like coconut are refreshing, hydrating and naturally low in sugar. These include maple, birch and bamboo waters.

What does it all mean?

Just these few highlights alone point to some powerful conclusions and compelling opportunities in the 100 percent juice category.

I encourage you to check out the full report for full details. It shows that consumers overwhelmingly see 100 percent juice as tasty (85 percent), natural (81 percent) and healthy (81 percent). These results are based on a survey of 7,000 users in seven of our key markets, including Brazil, China, Germany, and the United States.

Given these incredible metrics, developing flavorful, natural and healthy 100 percent juices presents some powerful opportunities. Shifting trends such as the growing popularity of on-the-go breakfast eating suggests more juice products featuring convenient, single-serve re-sealable packs could have widespread consumer appeal.

It’s also clear that some consumers are willing to pay a premium for juice that can deliver functional benefits like health and natural ingredients, which could offer companies a revenue boost if they can deliver value-added juices with functional benefits or juices that are not clarified at a higher price.

Stay tuned for part two of our series featuring key insights from Tetra Pak’s Juice Index report.
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