The beverage market is the 3rd packaging market. The market slightly declined by 0.4% from 2012-16 and projects to grow at an annual rate of 1.3% till 2022 reaching a value of $89.7 billion (1). Asia is the largest market for drink packaging, followed by North America and Western Europe. Asia and EMEA are forecasted to grow at the fastest rates.
The beverage market is facing three challenges: sugar, plastic and local brands.
According to the World Economic Forum, our plastic problem is out of control and the beverage market is a major driver of plastic production especially for water, juice and soft drinks. We need to take into acocunt regulation changes and new consumer patterns in the coming years and their impact on packaging production from substrate sourcing, to printing and converting.
Sugar content is another very hot topic all over the globe. Many beverages are considered to be unhealthy forcing brands to adapt to new consumer demand.
Local brands, especially for beers and juices, are gaining traction notably in richer countries, generating a new type of packaging production with faster time to market and closer to the consumers.
The beverage market is directly connected to the problem with plastics as this is the main packaging used. It is clear that plastic waste is a complicated problem – spanning economics, sustainability, social pressures and recycling infrastructure in both developed and developing countries. India’s Prime Minister pledged to eliminate all single-use plastic in the country by 2022, with an immediate ban in urban Delhi. The ban is however not the only path. Recycling is on governments, brands and retailers agendas. “Plastic isn’t the problem. It’s what we do with it,” says Erik Solheim, head of UN Environment.
Bio-PET bottles based on renewable resources are now appearing in the marketplace. While it’s widely known that plastics can be an issue for the environment, what isn’t often known is that the persistence of plastics in the environment is actually closely linked to how they are made. The overwhelming majority of plastics are made using oil-based materials, meaning that, by their chemical nature, many plastics have no oxygen content. This makes them very hydrophobic (water hating) and, as such, it is very difficult for common bacteria or enzymes to break them down if they enter the environment. The concept of using bio-based materials as a resource rather than oil-based materials has really gained momentum. Sustainable bio-based material will see as stronger area of focus for packaging.
Renewable or compostable plastics are not widely recycled. Part of the plastics problem is that the material is perceived as having no value, unlike glass or aluminum, so it is often thrown away instead of recycled. Americans alone dispose of 130 billion bottles and cans every year and 340 billion beverage bottles and cans are not recycled every year worldwide.
In 2018, consumers researched before they bought more than ever before, and that includes beverages. With a quick search on their smartphones, consumers can make informed and speedy choices about the products they consume. Which beverage provides the vitamins and energy boost needed for a workout? Which drinks promote healthier skin? Where and how is the juice produced? What are the core values and history of the company manufacturing the product? Successful beverage businesses will use digital and social media platforms to connect with consumers, providing robust product research avenues, tips, stories, forums and more for the information hungry consumer. Harnessing the internet of things and big data are important parts of that overall strategy as well and packaging will have a totally new role to play.