BUBBLING OVER: Sparkling Water Embraces New Channels BY ADRIANNE DELUCA
The sparkling water category continued its steady, upward trek throughout 2021, making space for new flavor innovations, functional ingredients and format extensions despite ongoing supply chain disruptions, labor shortages and transportation constraints. With its strong grounding in the better-for-you space, analysts say the sparkling water category is poised for continued momentum. According to a recent report from IRI, total dollar sales in the category accelerated 9.8% year-over-year, reaching over $4 billion in sales across most retail channels, including c-stores, over the 52-week period ending October 31. Additionally, total dollar sales in the category jumped 7.2% during the two-week period ending October 23, according to a report of NielsenIQ data by Goldman Sachs Equity Research. However, as the sparkling water category continues to welcome new brands and line extensions to the market, securing on-shelf space is becoming increasingly competitive. Despite points of differentiation like flavor and function, newer sparkling water brands are looking to embrace opportunity in channels where the category has not traditionally operated, including e-commerce, cstores and on-premise partnerships.
CONVENIENCE OPPORTUNITIES With premium positioned and functional products driving innovation, Joan Driggs, VP of Content and Thought Leadership for market research fi rm IRI, emphasized the growth opportunities for 48 BEVNET MAGAZINE – NOVEMBER/DECEMBER 2021
sparkling beverages in c-stores. Driggs noted that continued supply chain challenges could be the push brands need to explore different formats, for example switching from cans to plastic bottles that are resealable and more appropriate for placement in convenience. “I think there’s really an opportunity in the convenience channel because as we gain mobility and people are increasing their time at work and their commute time, they are going to be looking for more convenient beverages and sparkling waters are such a great, clean, no-pressure beverage,” Driggs emphasized. Talking Rain’s Sparkling Ice set its sights on convenience several years ago, and it still maintains its lead in c-stores, holding the highest percentage of unit sales; it’s closely followed by brands such as Topo Chico and antioxidant-infused seltzer water Bubbl’r, according to data from Skupos, a tech company that collects sales data from over 14,000 independent c-stores in the U.S. In independent convenience, sales of Nestle’s Perrier jumped 12% this year, accelerating the carbonated mineral water into the fourth top seller spot ahead of brands such as Vita Ice, San Pelligrino and PepsiCo’s Bubly. Overall sparkling water unit sales have decreased slightly, at a rate of 4%, in c-stores this year according to data from Skupos. According to Driggs a decrease in unit sales has been experienced across multiple channels and non-alcoholic beverage categories as brands grapple with supply chain constraints and are forced to take on price increases.
