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Demand For Water-Based Drinks Up Despite Inflation, IRI Report Finds

By Robert McHugh
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A new report from IRI has found that inflation and sustained demand drove 8.9% value sales growth of water-based drinks in Europe in the year to end August 2022, to €35.6 billion.

Analysis from IRI’s data (from actual sales of FMCG products across Europe) for the period reveals new trends across the global water category.

New Trends

Value sales in water-based drinks (excluding tea, coffee, juices, nectars and water additives) in Europe – grew by 9% in the period, driven by inflationary trends.

The data also shows that price increases across more than half of all water drinks products has not led to reduced demand, with volume sales growth of 3.4%, equating to an additional 1.7 billion in units.

‘Largely Resilient’

“The water-based drinks category is largely resilient to inflationary trends,” commented Ananda Roy, Global SVP, Strategic Growth Insights, IRI.

“We can see this is the case across key European markets, despite 55% of ranges being at higher prices. Despite the growth in volumes, the IRI data indicates that consumers are not uniform in their choices, implying strategic decisions are being made.”

Consumer Demand

The report shows that availability of high quality, accessible tap water sources influences water product sales. In countries where consumers do not trust their local water, sales of bottled water are essential.

However, IRI has warned that regulation, bans and price caps highlight the cost of ‘doing nothing.’

“Consumers are not willing to swallow the environmental impact of drink packaging, fossil fuel, water and greenhouse gas use,” according to Roy. "As they become more aware of the carbon footprint and transportation, water miles, packaging weight and use, this will influence their purchase decisions.”

‘Sustainability Position’

In addition, in a post-pandemic world, consumers need to address their "sustainability position" says Roy, "as the definition has broadened to include social and ethical behaviours – and perhaps even consider whether sustainability could even become a trial and choice driver.

"Detailed analytics can provide clear support to drive this market even further forward."

For more information visit: www.iriworldwide.com

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