Saudi beverage market on 8pc annual growth
Dubai, April 7, 2013
The Saudi Arabian beverage market is growing at an annual rate of over eight per cent, with each household buying an average of eleven various beverage categories, according to a market research expert.
“Cold beverages and dairy product range, and interestingly more contemporary segments like energy drinks, malt drinks and flavoured dairy products are leading the spurt,” added Ranjitha Subash, Consumer Insights director at Kantar Worldpanel, a world leader in consumer knowledge and insights based on continuous consumer panels.
“A high growth rate of these segments indicates a fragmenting of the beverage market through the development of differentiated need states.”
Subash cited information derived from the household purchase panel in Saudi and insights she shared at the recent the Middle Beverage Congress.
“Our home panel data reveals a compelling truth, which is that there are only three ways to grow a business; gaining more consumers, making consumers buy more often and making them purchase bigger quantities.”
Her insights go on to reveal that a lot of the high growth categories are expanding the Saudi buyer base. Interestingly flavoured dairy products enjoy an increase in both buyer base and consumption levels; the best form of sustainable growth.
“Though the ‘newer formats’ are gaining momentum, these categories are more inclined towards expats who seems to be the early adopters, locals still prefer traditional beverages like coffee, concentrates and laban.”
Interestingly, shopper behaviour is changing for the beverage categories, she said.
The data went on to reveal that the number of shopping trips for beverages has not increased over time. However most of the beverage categories are seeing an increase in basket size where consumers are either upsizing or opting for multi packs. Brands need to compete for basket share during these trips, Subash said.
“Another big trend indicates that the Saudi market is showing a gradual shift towards cold with hot beverages losing growth momentum amongst its core consumers. Residents still continue to consume hot beverages with coffee more patronised by affluent class and tea relatively towards the lower class,” explained Subash.
Saudi Arabia is home to a population of 28 million, which continues to grow at three per cent annum or three times more than the world growth forms an important market naturally, she pointed out.
“We need to watch and track the momentum of this evolving beverage market that is poised for a promising future as its time now for these new beverage formats to get cracking on speaking to the local Saudi families to accelerate their growth momentum,” she concluded. – TradeArabia News Service