By: B. Arun Srinivas -- Senior Research Analyst, Flexible, Rigid, and Bulk Packaging
01 January, 2017
Aggressive marketing campaigns and push from brand owners and suppliers alike have introduced a growing demand for sleek and slim cans in the beverage cans segment. This has resulted in a marginal decline in demand for standard beverage cans within North America at negative 0.5–1 percent. This article intends to analyze whether the sleek and slim can packaging format is just a marketing fad, or if there is a growing possibility of sleek and slim cans becoming a beverage-can trend in the future.
Red Bull introduced their product in the sleek can format, but this gained popularity in the early 1990s. Afterward, the energy drinks market was flooded with new players who bolstered the demand for smaller pack sizes among consumers. This has resulted in various other end users including carbonated soft drinks, alcoholic beverages, and fruit juice/wellness drinks to adopt this packaging format.
Demand forecasts point toward a steady decline in standard cans over the long term, which is compensated by strong growth in specialty can formats in North America. Around nine percent of energy drinks and close to 50 percent of fruit juices are packaged in specialty can formats; these being the fastest growing beverage segments, they are driving market toward a permanent shift.
1. Smaller Pack Sizes: Growing health consciousness among consumers is facilitating preference for smaller pack sizes (portion control) across beverage segments.
2. CSD Strategy: Foreseeing a decline in demand for CSD, manufacturers have worked to retain their market shares by introducing new products and standard products in slim packaging formats.
3. Push from Retailers: Retailers have been attempting to stock and sell more energy drinks and newer juice/CSD SKUs, which render more profit per area occupancy in displays and refrigerators. Most of these newer products on the market are in slim/sleek formats.
4. Growing Energy Drink Consumption: Energy drinks are expected to see significant 7–8 percent CAGR over the next five years. Most energy drinks are packed in slim/sleek formats, which has fostered the shift toward slim/sleek cans.