RTDs continue to decline

22 February, 2008

The RTD market is declining, and some of the products that should have been the big hopes for the category - like Bacardi Breezer Half Sugar - are seeing sales plummet.

But it's not all bad news. At the top of the league, WKD is still making progress with 5 per cent value growth against a 4 per cent volume increase. Regular TV ads keep the brand at the front of consumers' minds, and it topped that off over Christmas by sending retailers point of sale kits with WKD-branded tinsel, mobiles and bunting, and guides on how to survive the festive season.

VK Vodka Kick has boosted sales by 33 per cent against a 29 per cent volume increase, and Gordon's & Tonic grew its sales by 18 per cent - albeit against a 27 per cent volume surge that suggests a large-scale price promotion.

While major brands such as Smirnoff Ice, Bacardi Breezer, Red Square and ­Car ibbean Twist suffer, own-label RTD sales have shown surprising growth. Own-label only makes up 2.3 per cent of the total RTD market, with £4.8 million sales in the past year, but that is a very healthy 47 per cent up on last year. That growth comes against a 39 per cent increase in volumes - so there does seem to be some value in the market.

Last year Bacardi Breezer Half Sugar grew sales by 126 per cent, sparking hopes that a link to dieting or healthy living could stem the flow of sales out of the RTD sector and into more natural-seeming cider, which has been stealing the sector's sales.

But this year's 16 per cent sales drop shows such hopes were unfounded - instead the more lurid-coloured offerings in the market are managing to hang in there while others slip down the charts.

Overall it is a bleaker picture than last year, with seven of the top 10 brands in decline compared with five in 2006.




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