The youth market - a bipartite problem
Soft drinks manufactures are increasingly focusing marketing efforts on the young. Children play a key role in developing a future consumer base but they are also becoming powerful buyers in their own right. Sarah Diston reviews a recent report that tries to unravel this complicated market.
In a complete reversal on trends in the late 1970s, US teenagers now consume twice as much in carbonates than milk. And while this trend is more pronounced in the US than in other countries, it is a trend, says beverage analysts Datamonitor that is being replicated to different extents across the developed world.
US teenagers now consume twice as much in carbonates than milk
And, with children drinking around 200 litres of soft drinks per head in the UK alone, manufacturers are increasingly focusing their marketing efforts on attracting the younger generation.
A report just published by Datamonitor, entitled Targeting Soft Drinks to Youths claims that although the population of youths on the whole is declining across Europe, (and only growing, albeit marginally, in the US) the purchasing power of the younger generation is rising disproportionately, as parents increasingly pamper their children.
The effects of this shift have meant that although youths and parents used to be seen as equally important audiences for beverage marketing, the importance of the youth market will continue to grow over the next five years in the eyes of manufacturers.
"Greater consumer sophistication and the ability to influence parental purchase decisions raise the importance of developing specific marketing strategies for youths. Taking both youth and parental considerations into account is essential to leverage both pester power and parental endorsement," says Datamonitor.
But by examining consumption across seven European countries and the US, Datamonitor found that consumption habits change with age and so marketing to the youth as a single consumer group is difficult for any manufacturer.
In terms of consumption it identifies three age groups - three- to nine-year-olds, 10- to 13-year-olds and the 14-17 age groups. The report discovered that the three age groups generally favoured carbonates, bottled water, juices, squashes and cordials. But, powdered drinks, squashes and cordials are consumed by larger quantities by the three- to nine-year-olds and 10-13 year-old age groups. Meanwhile, carbonates and energy and sports drinks are more popular with teenagers.
According to Datamonitor young children depend on the purchasing power of their parents, while the 10- to 13-year-olds are less dependant on parents, have limited disposable income and are far more image conscious and use pester power tactically. Lastly, teenagers are typically relatively independent from their parents, have significant disposable income, use pester power less often and are fashion conscious.
"Segmenting the youth of today is something manufacturers and retailers need to take to a whole new level as marketing to the youth market as a single, homogenous consumer group is no longer a relevant approach.
"Increasingly sophisticated children are displaying widely differing characteristics between age groups," the report states.
It goes on to explain how marketers can maximise their potential. "Character merchandising and sensory fun play key roles in product concepts for youth soft drinks. With a healthy positioning, the stimulation of pester power combined with parental endorsement can be a formidable formulae.
"Being positioned as a vitamin-enriched juice and placed in the chiller to emphasise freshness was a successful ground-breaking move."
"Youth marketing has been driven heavily by the increasing economic power of children and teenagers. Furthermore a critical factor in the marketing process is the establishment of brand awareness and loyalty early on in people's lives.
"Soft drinks are not the first priority in youth expenditure, yet their importance is one of the top and this importance is growing marginally."
But while the growing spending power of children cannot be ignored neither can the effects of parental influence on a product. Neil Broome, Datamonitor's drinks industry analyst says: "The recent furore surrounding the health claims of Sunny Delight highlighted the complexities of marketing one product for both children and parents.
"Being positioned as a vitamin-enriched juice and placed in the chiller to emphasise freshness was a successful ground-breaking move. But faced with increasingly sophisticated parent purchasers, however, meant that the brand's health claims were rapidly exposed as being somewhat overstated."
However, Proctor & Gamble, the owners of Sunny Delight, were right, according to Broome, in trying to please parents as well as children.
The future of the lucrative youth group lies in striking a balance between the importance of manufacturers and marketing teams alike. Likewise brand owners must attract brand loyalty among children but not forget the importance of the parent in the equation.
Children will always remain a fickle audience, so while the latest toy or film craze may win appeal today it can be equally easily forgotten by tomorrow. Therefore appealing to the paying parent and appreciating the bipartite decision making process that occurs when parents buy products for young people holds the key.
Targeting Soft Drinks To Youths
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