Faltering Future for FABs?

After explosive growth in the last few years, the European market for flavoured alcoholic drinks (FABs) is finally slowing down and will be in decline by 2008, according to analysis and forecasts by Datamonitor.

The UK is still Europe's largest market, worth £1.4bn, but in 2003 the market experienced volume growth of only 6.3%, compared to 19.3% in 2001. 18-24 year-olds account for 41% of total sales value, and the very success of the brands has made them 'mainstream, and therefore less appealing to the most discerning consumers', according to the report's author, Consumer Markets Analyst John Band.

Datamonitor forecasts that sales of FABs will decrease by 23%, to £1.1bn in 2008. The UK market more than doubled in value, from £692m in 1999 to £1,421m in 2003, a time when the beer market was actually declining by 12%. The British are Europe's biggest spenders on FABs, spending £23.50 per head in 2003, but this is partly to do with higher prices - the Irish spent only £14.30 equivalent but consumed more (4 litres per head versus 3.3 for the UK). The Finns are also big consumers of FABs, spending £15.40 and consuming 3.1 litres per head.

The report blames the slowing growth on 'lack of cool', pointing out that premixed spirits drinks became successful in bars and clubs, spreading to retail only later on - in the UK, 55% of FABs volumes are still sold through the on-trade. Brand says that 'Clubbers have switched towards drinking white spirits such as Smirnoff and Bacardi, while cocktails have also made a comeback. Premixed spirits have acquired the 'drink-for-people-who-don't-like-alcohol' image they initially sought to avoid'.

Brand also says that as 65% of FABs in the UK are drunk by women, it's hard for a brand to avoid acquiring a girly image - 'the kiss of death for any drinks brand that wants to target males. Smirnoff Ice was launched as a drink targeted more at men than women, but it's now rare to see males drinking the standard product'.

'Young adults are big spenders on alcoholic drinks, but they're very promiscuous in their tastes... An older drinker may drink the same brand of beer or spirits for years, but young adults vary their brand from one drink to the next - never mind from one year to the next. So life as a drinks brand aimed chiefly at young adults is precarious at best. In the bigger European markets, FABs are no longer at the top of this pile'.

The report, 'Beer, Cider & FABs in the UK to 2008' includes comprehensive value, volume, segmentation and market share data up to 2003, with forecasts to 2008. The company's web site is at www.datamonitor.com

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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