Beverage Market In Saudi Thriving
Saudi beverage market experiencing 8 % annual growth
· Eleven beverage categories purchased per household
· Average of 11 beverage categories per household
Dubai, UAE April 2013: The Saudi beverage market is growing at an annual rate of over eight per cent, according to Ranjitha Subash, Consumer Insights Director at Kantar Worldpanel.
Insights revealed that the food and beverage (F&B) sector is driving sector growth, with each Saudi household buying an average of eleven various beverage categories.
“Cold beverages and dairy product range, and interestingly more contemporary segments like energy drinks, malt drinks and flavoured dairy products are leading the spurt,” said Subash.
“A high growth rate of these segments indicates a fragmenting of the beverage market through the development of differentiated need states.”
Subash cites information derived from the household purchase panel in Saudi and insights she shared at the recent the Middle Beverage Congress. “Our home panel data reveals a compelling truth, which is that there are only three ways to grow a business; gaining more consumers, making consumers buy more often and making them purchase bigger quantities.”
Her insights go on to reveal that a lot of the high growth categories are expanding the Saudi buyer base. Interestingly flavoured dairy products enjoy an increase in both buyer base and consumption levels; the best form of sustainable growth.
“Though the ‘newer formats’ are gaining momentum, these categories are more inclined towards expats who seems to be the early adopters, locals still prefer traditional beverages like coffee, concentrates and Laban.”
Interestingly shopper behaviour is changing for the beverage categories. The data went on to reveal that the number of shopping trips for beverages has not increased over time. However most of the beverage categories are seeing an increase in basket size where consumers are either upsizing or opting for multi packs. Brands need to compete for basket share during these trips.
“Another big trend indicates that the Saudi market is showing a gradual shift towards cold with hot beverages losing growth momentum amongst its core consumers. Residents still continue to consume hot beverages with coffee more patronised by affluent class and tea relatively towards the lower class,” explained Subash.
The Kingdom is home to a population of 28 million, which continues to grow at three per cent annum or three times more than the world growth forms an important market naturally.
“We need to watch and track the momentum of this evolving beverage market that is poised for a promising future as its time now for these new beverage formats to get cracking on speaking to the local Saudi families to accelerate their growth momentum,” she concluded.
Kantar Worldpanel is the global leader in consumer insights based on continuous consumer panels while TNS features as the world’s largest custom market research organisation. Both are part of Kantar, one of the world's largest insight, information and consultancy networks.
*Source: KSA Home Purchase Panel, Year 2012.
About TNS MENA
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TNS is part of Kantar, one of the world’s largest insight, information and consultancy groups.
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About Kantar Worldpanel
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