Today the market is flooded with variety of still drinks, nectars and juices. While mango drinks hold ~80% of the market, other flavors are growing at a much faster rate. This represents a huge opportunity for brands which are in the beverage business or want to enter this segment. To win in this niche one must have a detailed understanding of the Indian palate.

Taste and flavor preference is always an outcome of the first product experience itself. For instance – my father has customarily experienced Indian fresh orange juice (sweet lime), hence his product preference will be tilted towards Indian oranges. On the other hand, I grew up consuming fruit juices made from concentrates hence those nodes are perfectly acceptable to my palate

When consuming beverages, another aspect is equally important. The “need state” of the user is a function of the time of consumption and often determines the appropriate flavor and notes. Following are some need states and the suitable fruit beverage consumers would prefer to ingest:

Breakfast

Today, breakfast has become the “entry need state” to the category. This is a result of the meal migrating from traditional parathas to cornflakes, sandwiches etc. In this period, the consumer’s expectation is to cleanse the overnight palate and obtain a refreshing action that can ‘wake up the brain’. Please note that breakfast is the time of the day where the taste buds and other receptors are fairly dormant. Therefore the beverage requirement will be different; only certain kinds of flavours/fruits will work in this phase.

Mid-morning or Mid-afternoon or a part of lunch box for kids

This is second “need state” in a consumer. The user’s expectation for beverages consumed during this time is different from morning. During this phase, consumers have more time, whereas the breakfast drink is typically intended for fast consumption. One of the reasons for beverage consumption at this time is to create or break the mood.

At this time of day it is generally women/elderly/schoolkids who consume beverages and psychologically there is permission to enjoy but not indulge. Unlike morning, the taste receptors are fully functional.

With Lunch and other Meals

While this need gap is evolved more in developed nations, this is still fairly new and an emerging need gap in India. Here the requirement is more for functional ingredients in the beverage, which should also help build up the taste from the food, i.e. the preferred beverage should complement the food, not take away the taste. Currently carbonated drinks operate in this space.

Social Situations – In home and out of home

This is large segment. Here consumers are more at ease and in a mood for indulgent, open-minded, relaxed consumption. The presentation of the drinks also adds to the overall experience and user willingness to try a new beverage is higher. The expectation from the beverage is to add refreshment and it should complement the mood of the occasion. The need gap is not about quenching thirst or any functional need, this is an occasion for purely liquid pleasure.

Original article was published in Beverage Industry Blog

India is a fast-growing and large emerging market. Although consumption patterns are changing, food and beverages still account for a substantial part of Indian consumption (over 30%) compared to other emerging markets (Brazil at 17% and China at 25%). Within the food and beverage category, in recent years, there has been a shift towards packaged food and beverages and branded products. India is also a large producer of fruits, vegetables and milk. The government is trying to develop the country as a food processing hub, which is likely to boost the Indian food processing sector in particular and the manufacturing sector in general

Favourable demographic trends; emergence of urban middle class – More than half of the country’s 1.2 billion people are under the age of 30 years. This young population, aspiring to improve its standard of living, is expected to drive the growth of the country’s consumption led food and beverages sector. India’s middle class population is expected to increase three times the current level in the next decade. Out of this, nearly 40% of the population would be living in urban areas. Indian economy is expected to triple in the next decade. The resultant income growth would lead to a rise in middle class customers. It is expected that the share of this middle class (strivers and seekers) would increase from 14% in 2008 to 46% in 2030.

Key highlight of India

• It is one of the most rapidly growing economies in the world.
• It is one of the largest beverage markets worldwide (by volume) for alcoholic beverages and soft drinks.
• Per capital consumption is still very low but is rapidly increasing (alcoholic drinks: +28%, soft drinks +100%).
• It is the number one market for milk and dairy products and is still growing.
• It is already a leading exporter for several food products because of its rich resources.
• Its domestic food market will reach 300 billion USD in 2020.
• Its food production is likely to double in the next ten years.
• The food processing sector was identified as a priority in the “Make in India” initiative to make India a food-processing hub and not just an exporter of raw produce.
• It is the number one producer of buffalo meat.
• It is the second largest producer of agricultural commodities worldwide.
• It is the number two producer of fruits and vegetables.
• It ranks fifth in poultry production.