COMMENT: Alcopops are losing their cool
The explosive growth of flavored alcoholic drinks (FABs) is finally running out of steam as the drinks become a victim of their own success. Datamonitor's John Band explains that they have become mainstream, and therefore less appealing to the most discerning consumers.
The UK was at the forefront of the boom. The FABs market more than doubled in value, from £692m in 1999 to £1,421m in 2003. In comparison, the beer market decreased by over 12% over the same period. Unsurprisingly, the British are Europe's biggest spenders on FABs, spending £23.5 per head in 2003. Not far behind are the Finns, who spent GBP15.4, closely followed by the Irish with GBP14.3. In consumption terms, however, the Irish take the lead, with 4 liters per head. The UK comes second with 3.3 liters per person, followed by Finland with 3.1 liters per head.
The explosive growth finally seems to be running out. FABs sales grew by 10.4% in 2003, against almost 27% in 2001. The major reason for this decline is their lack of cool. Premixed spirits drinks became successful in bars and clubs, spreading to retail only later on - in the UK, 55% of FABs volumes are still sold through the on-trade. Along with their less cloying flavors and their similarity to established grown-up spirits brands, the on-trade focus helped the brands escape from the unsophisticated image that alcoholic soft drinks once had.
Young Brits switch to classier drinks
As premixed spirits have become mainstream, so they have become less appealing to the most discerning consumers. Clubbers have switched towards drinking white spirits such as Smirnoff and Bacardi, while cocktails have also made a comeback. Premixed spirits have acquired the 'drink-for-people-who-don't-like-alcohol' image they initially sought to avoid.
The gender gap also doesn't help. Being seen as a 'girly' drink is the kiss of death for any drinks brand that wants to target males - but women are not turned off by 'blokey' brands in the same way. As 65% of FABs in the UK are drunk by women, it's hard for a brand to avoid acquiring a girly image. Smirnoff Ice was launched as a drink targeted more at men than women, but it's now rare to see males drinking the standard product.
A few years ago, premixed spirits looked like the future of the alcohol industry. The leading drinks companies were falling over themselves to invent premixed versions of their spirits brands, from Gordon's Edge to Jim Beam & Cola. But it now looks like the premixed spirits boom was just a repeat of the mid-1990s alcoholic soft drinks boom.
Young adults are big spenders on alcoholic drinks, but they're very promiscuous in their tastes. An older drinker may drink the same brand of beer or spirits for years, but young adults vary their brand from one drink to the next - never mind from one year to the next. So life as a drinks brand aimed chiefly at young adults is precarious at best. In the bigger European markets, FABs are no longer at the top of this pile.
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