The conservative drinking habits of European consumers mean that new age beverages (herb or juice based drinks or iced tea and coffee) account for a small proportion of the European drinks market. However, in an increasingly stagnant drinks industry, the new age beverages sector stands out as a major growth area for the future.

The European new age beverage market has seen value growth at 10.2% a year from 1996-2001, while volumes grew by 9.7%. Despite this, new age beverages account for a small proportion of the European drinks market. Within the market, iced tea currently holds the largest share, due to the conservative drinking habits of European consumers.

New age beverage sales differ radically across the continent. Eastern Europe has not yet caught 'new age fever' and there is little penetration. In the rest of Europe, wide variations exist - Sweden's market was worth US$12.1m in 2002, for example, but neighboring Finland sold three times that figure.

Despite its relatively small population, Switzerland has the largest new age beverages sector in Europe, accounting for almost a quarter of the market. Moreover, in consumption terms, the average European drank 6.46 litres of new age beverages in 2001, whilst the average Swiss drank 107.48 litres.

Even though the new age beverages market is booming, carbonates still hold the largest share in Europe, representing over 40% of the soft drinks market. However, bottled water, the second largest sector of the European soft drinks market, will provide the new age beverages sector with its greatest competition. Sales of bottled water are expected to continue growing on the back of rising awareness of the health benefits associated with consuming water.

The increased demand for diverse foreign flavors will provide some impetus for new age beverage market growth, but while consumers are willing to try new flavors, different types of drink are faced with some caution. Market growth for new age beverages will come with the increased acceptance of these goods as a healthier and more flavorsome alternative to carbonates or water.

Related research: Datamonitor, " The European Soft Drinks Market to 2006" (DMCM0351)