Canadian restaurants ride the beverage wave

By Linda Strachan
Canadian restaurants ride the healthy beverage wave

With the welcome return to warm weather, consumers will look for more thirst-quenching options from their favourite restaurants.

Carbonated soft drinks (CSDs) are a restaurant standby, one of the largest product categories tracked by The NPD Group, topping more than 1.3 billion servings in the past year. However CSDs at restaurants have experienced a steady decline for the past five years. There are a number of reasons why customers are choosing fewer CSDs, including a move away from combos at quick service restaurants. Many consumers made the switch from full-calorie sweetened beverages to diet, light, and zero-calorie versions. Recently however, some consumers have started to watch their consumption of artificial sweeteners, even at zero calories.

Natural is the buzz in beverages

 

These concerns have led to a growing back-to-real trend in beverages, emphasizing not just what’s put into a beverage, but also what’s left out. Consumers look for more than calorie-count alone when selecting a better-for-you beverage. Along with natural ingredients, taste and quality are high priority, as always. Benefiting from this trend are smoothies, the fastest growing menu item in the restaurant industry. In fact, smoothies more than doubled for the year ending February 2012, to over 84 million servings. Smoothies tick all the boxes for a guilt-free, affordable indulgence: They taste great; they’re good for you, are convenient and portable for an on-the-go snack, and QSR pricing of $2 – $3 for a snack size is easy on the wallet for budget-weary consumers.

Upscale/downscale beverage options

Adding to a beverage line-up can help build business outside of main meal visits, as upscale beverages like smoothies and iced coffees are most popular as an afternoon snack. Females, and customers under age 35 are more likely to order these cold confections.

The interest in authentic, natural ingredients is leading to more high-quality tea, soda, and non-carbonated beverage offerings. On the flip side, even as consumers are faced with a longer list of beverage options at restaurants, more diners than ever are opting for plain tap water – not sparkling, flavoured or bottled water. Whether this trend is due to frugality or health-seeking, over the past three years, tap water has steadily grown at restaurants, representing seven per cent of the 6.2 billion beverage servings ordered in Canada annually. Of course, the challenge is that tap water doesn’t do much to build sales and profits. Tempt them with new and exciting options to make sure that tap water doesn’t become the default beverage.

When considering your beverage line-up, keep in mind that consumers are increasingly seeking the least-processed, best-tasting and most-nutritious beverages. The beverage demand is there, to replenish, recharge, relax, and indulge customers.

About the author

Linda Strachan is a restaurant industry analyst for the NPD Group. The NPD Group has more than 25 years of experience providing reliable and comprehensive consumer-based market information to leaders in the foodservice industry. For more information, visit www.npd.com or contact Strachan at linda.strachan@npd.com.

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