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    Japan leads the way in global RTD revival (Excerpt)

    Japan leads the way in global RTD revival (Excerpt)

    Source: The IWSR Magazine

    By Simon Molony

    July 20, 2017

     

    After a slump in 2015, the mixed drinks category returned to growth last year, with volumes increasing by 6,400 nine-litre cases to fall just short of the 400m-case mark.

     

    The category has grown at a compound annual growth rate (CAGR) of 3.62% between 2012 and 2016 as emerging markets in Africa, Asia and Latin America drove new volume growth, while the largest market in the category - Japan - continued to add volume. 

     

    Japan remains one of the most dynamic and highest growth mixed drinks markets, with ready-to-drinks (RTDs) remaining popular as an affordable, convenient and ever-changing proposition. Citrus flavours are traditionally popular; Sapporo's limited release in October 2016 is a limoncello-based RTD.

     

    The world's largest RTD market grew by a staggering 10% in 2016 as consumers, particularly younger ones, continued to move away from beer and liqueurs.  Younger consumers' drinking habits are changing as they increasingly start the evening with RTDs rather than starting with beer and switching to RTDs later on.  The current trend seems to be towards sweeter RTDs.

     

    The most notable brand development last year was the launch of Mogitate Chuhai, which reached volumes of 4.7m cases; interim reports showed that the 9% fruit-flavoured spirit drink had helped to boost Asahi's RTD sales by 33% in the nine-month period to end-September.

     

    Overall, the category's young consumer base is gradually looking for cheaper and more natural alternatives, while on-premise consumption is declining as consumers there are looking for freshly prepared drinks such as cocktails and drinks with lower sugar content. Flavoured ciders are also a threat to the category. As the category is increasingly moving to home consumption, larger pack formats are becoming more popular.