by Danny Brager, VP, Beverage/Alcohol Practice, Nielsen
Seemingly from left field, alcoholic beverages packaged in a “pouch” approached $200 million in annual sales by Nielsen-measured retail outlets through August 18, 2012. Pouch retail dollar sales were only $12 million in a similar twelve-month period through August 2010.
And the trend shows no signs of slowing: Twelve percent of alcoholic-beverage buyers purchased a pouch product in the last twelve months, which is twice the number of people who tried it the previous year. The growth in popularity of this relatively new segment is attracting new product entries, flavors and brands, including many of the biggest supplier names in the alcoholic beverage business.
The alcoholic contents of the pouches vary — including malt, wine and spirits, depending on the brand — but they all have convenience appeal. Many are marketed as a frozen cocktail with no need for a blender: “just freeze, squeeze and serve.” Others claim quicker chilling, easy pouring and packaging with environmental benefits.
Not only are pouches ringing up significant sales, but new Nielsen consumer research shows that many of these sales are in addition to current alcoholic beverage sales, meaning that consumers are not switching from more traditional beer, wine, or spirits.
These products may be the catalyst for new drinking occasions, including on-the-go events. Research indicates that about ten percent of the pouch sales volume comes from buyers new to alcoholic beverages, while about 50 percent of volume comes from consumers purchasing pouches in addition to other adult beverage categories. The remaining 40 percent of the dollars come from buyers shifting their purchases from other alcoholic beverages, with spirits being the chief donor, followed in almost equal amounts by beer and wine.
Who are pouch buyers?
- Compared to mainstream (or the typical) alcoholic beverage consumers, pouches seem to appeal to 35-54 year olds, key Gen X and Baby Boomer age groups
- African-Americans and females are also buying pouches in above-average quantities.
Consumers will ultimately decide if pouches are a passing fad or here to stay, but several factors work in this trend’s favor:
- As major companies enter the scene, they come fully loaded with all their marketing support dollars to engage with both retailers and consumers
- New items continue to enter the market – there are now close to 100 pouch items being measured/reported by Nielsen, and that continues to grow
- There are now light-calorie versions available, designed to reach consumers concerned with calorie intake
- Retailers have a constant appetite for something new that generates growth – pouches fit the bill
- Pouch environmental and convenience benefits appeal to many retailers and consumers
As fall and winter approach, look for efforts to broaden pouch season. Already, new Spiced Sangria and Hard Cider pouch varieties have been launched, marketed “to be enjoyed warm, in addition to chilled or frozen.” Pouch packaging could also become alternative packaging for more mainstream wine and spirit package sizes. If successful, pouches may have staying power well into the foreseeable future.