Soft Drinks in The Philippines

SOFT DRINKS IN THE
PHILIPPINES
Euromonitor International
February 2017
SOFT DRINKS IN THE PHILIPPINES Passport I
LIST OF CONTENTS AND TABLES

Executive Summary ..................................................................................................................... 1
Soft Drinks Posts Stronger Growth in 2016 .............................................................................. 1
Consumers Remain Price Conscious Despite Rising Affluence ............................................... 1
the Coca-Cola Export Corp Maintains Market Leadership in Soft Drinks.................................. 1
Key New Product Launches Successfully Tap Into Demand Among Young Consumers ......... 1
Growth in Soft Drinks Is Expected To Slow Down Over the Forecast Period ........................... 1
Key Trends and Developments .................................................................................................... 1
New Product Launches Successfully Tap Into Demand Among Young Consumers ................ 2
Additional Excise Tax on Sugary Drinks Is Becoming More Likely ........................................... 2
Stronger Health Focus Goes Beyond Reducing Sugar Consumption....................................... 3
Market Data .................................................................................................................................. 4
Table 1 Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: Volume
2011-2016 .................................................................................................... 4
Table 2 Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: %
Volume Growth 2011-2016 .......................................................................... 4
Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2011-
2016 ............................................................................................................. 4
Table 4 Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value
Growth 2011-2016 ....................................................................................... 4
Table 5 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category:
Volume 2016 ................................................................................................ 5
Table 6 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: %
Volume 2016 ................................................................................................ 5
Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value 2016 ........... 5
Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value 2016....... 6
Table 9 Off-trade Sales of Soft Drinks (RTD) by Category: Volume 2011-2016........ 6
Table 10 Off-trade Sales of Soft Drinks (RTD) by Category: % Volume Growth
2011-2016 .................................................................................................... 6
Table 11 Off-trade Sales of Soft Drinks by Category: Value 2011-2016 ..................... 7
Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth 2011-
2016 ............................................................................................................. 7
Table 13 Total Sales of Soft Drinks by Fountain On-trade: Volume 2011-2016 .......... 7
Table 14 Total Sales of Soft Drinks by Fountain On-trade: % Volume Growth
2011-2016 .................................................................................................... 7
Table 15 NBO Company Shares of Off-trade Soft Drinks (RTD): % Volume
2012-2016 .................................................................................................... 8
Table 16 LBN Brand Shares of Off-trade Soft Drinks (RTD): % Volume 2013-
2016 ............................................................................................................. 8
Table 17 NBO Company Shares of Off-trade Soft Drinks: % Value 2012-2016 ........ 10
Table 18 LBN Brand Shares of Off-trade Soft Drinks: % Value 2013-2016 .............. 10
Table 19 Penetration of Private Label in Off-trade Soft Drinks (RTD) by
Category: % Volume 2011-2016 ................................................................ 11
Table 20 Penetration of Private Label in Off-trade Soft Drinks by Category: %
Value 2011-2016 ........................................................................................ 12
Table 21 Distribution of Off-trade Soft Drinks (as sold) by Format and Category:
% Volume 2016 .......................................................................................... 12
© Euromonitor International
SOFT DRINKS IN THE PHILIPPINES Passport II
Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by

Channel: Volume 2016-2021 ..................................................................... 13
Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by
Channel: % Volume Growth 2016-2021 ..................................................... 13
Table 24 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel:
Value 2016-2021 ........................................................................................ 13
Table 25 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: %
Value Growth 2016-2021 ........................................................................... 14
Table 26 Forecast Off-trade Sales of Soft Drinks (RTD) by Category: Volume
2016-2021 .................................................................................................. 14
Table 27 Forecast Off-trade Sales of Soft Drinks (RTD) by Category: % Volume
Growth 2016-2021 ..................................................................................... 14
Table 28 Forecast Off-trade Sales of Soft Drinks by Category: Value 2016-
2021 ........................................................................................................... 15
Table 29 Forecast Off-trade Sales of Soft Drinks by Category: % Value Growth
2016-2021 .................................................................................................. 15
Table 30 Forecast Total Sales of Soft Drinks by Fountain On-trade: Volume
2016-2021 .................................................................................................. 15
Table 31 Forecast Total Sales of Soft Drinks by Fountain On-trade: % Volume
Growth 2016-2021 ..................................................................................... 15
Appendix .................................................................................................................................... 16
Fountain Sales in the Philippines ............................................................................................ 16
Trends .................................................................................................................................... 16
Definitions................................................................................................................................... 16
Sources ...................................................................................................................................... 16
Summary 1 Research Sources ...................................................................................... 16
SOFT DRINKS IN THE PHILIPPINES Passport 1
SOFT DRINKS IN THE PHILIPPINES

EXECUTIVE SUMMARY
Soft Drinks Posts Stronger Growth in 2016

The Philippine soft drinks industry generated stronger growth in 2016 thanks to increasing
disposable incomes. Total current value growth was higher than total volume growth at industry
level in 2016, a trend which reflects the shift towards smaller pack sizes, which resulted in
average unit price increases in some categories.
Consumers Remain Price Conscious Despite Rising Affluence

Despite the increasing disposable income levels of Philippine consumers, unit price remained
an important factor influencing purchasing decisions in soft drinks in 2016. This was particularly
prevalent in carbonates, energy drinks and juice. Manufacturers have responded to the rising
price consciousness of consumers by launching more products in smaller pack sizes, which
enables them to offer products at different price points.
the Coca-Cola Export Corp Maintains Market Leadership in Soft Drinks

While domestic companies registered promising growth towards the end of the review period,
The Coca-Cola Export Corp maintained its leading position in the Philippine soft drinks industry
in 2016. The strong product mix and wide distribution network of the company has enabled it to
maintain dominance in carbonates and compete in other categories such as concentrates and
juice.
Key New Product Launches Successfully Tap Into Demand Among

Young Consumers
New product launches in soft drinks in 2016 involved not only offering existing products in
different pack sizes such as smaller PET bottles as B’lue and Kopiko 78C were able to bolster
sales in functional bottled water and RTD coffee with their aggressive marketing and distribution
efforts. The success of these two products launches lies on their effective brand communication
and engagement with students and young professionals.
Growth in Soft Drinks Is Expected To Slow Down Over the Forecast

Period
Because of the exceptional performance of categories such as carbonates, juice and RTD tea
in 2016, growth across the entire soft drinks industry is expected to slow down over the forecast
period, with slower rates of growth in off-trade volume and value terms expected. The maturity
of certain categories, specifically cola carbonates, is likely to suppress higher rates of growth
across the industry.
KEY TRENDS AND DEVELOPMENTS
New Product Launches Successfully Tap Into Demand Among Young

Consumers
2016 was an exceptional year for newcomers B’lue and Kopiko 78C. B’lue was launched in
functional bottled water in January 2015, while Kopiko 78C was launched in RTD coffee in
October 2015. A joint venture between Universal Robina Corp and Danone, Danone Universal
Robina Beverages Inc, was formed to manufacture and market B’lue, a functional bottled water
brand with three flavour variants: Calamansi, Lychee, and Orange. Meanwhile, banking on its
strong brand equity as a manufacturer of coffee mixes, Pt Mayora Indah Tbk launched Kopiko
78C in October 2015. Each of these new brands has benefited from the strong distribution
network and strong marketing capabilities of its parent company, although much of the success
of these two new brands derives from the clear identification of their shared target audience:
young consumers, particularly students.
The promotion for each of these brands combined television advertising and trade marketing.
Specifically, key trade marketing activities include activations, sampling and in-store displays in
both modern and traditional grocery retailers outlets. For example, B’lue has been implementing
school and shopping centre activations since 2015, particularly in colleges and universities, as it
is targeting the ‘social media generation’. Similarly, Kopiko 78C has also been promoted through
sampling in schools and events where the audience comprises mainly young consumers. All
these efforts seemed to have paid off as each brand outperformed the leader in its category in
2016.
Outlook
Prior to the launch of B’lue and Kopiko 78C, functional bottled water and RTD coffee primarily
catered to a niche audience of students and young professionals. However, the success of
these brands in creating a new consumer segment added vibrancy in each of the categories in
which they are present. Over the forecast period, B’lue is set to drive growth in functional bottled
water, with the category set to increase in each of off-trade volume and value at a CAGR of 12%
at constant 2016 prices, while Kopiko 78C is expected to spur RTD coffee to 22% off-trade
volume and value CAGRs constant 2016 prices. However, the manufacturers behind these
brands will still need to strive to increase the penetration and strengthen marketing and
promotional campaigns in order to remain relevant, which is set to be a key element behind
attempts to achieve the positive outlooks expected in each of these two categories.
Additional Excise Tax on Sugary Drinks Is Becoming More Likely

Following the dismissal of House Bill 3365, House Bill 292 was passed during July 2016,
signalling the Philippine parliament’s determination to regulate the sale of sugary beverages.
This bill seeks to impose a PHP10 excise tax on sugary drinks per litre. While this bill had not
been passed into law as of October 2016, there is a high likelihood that this will be converted
into law under the Philippine government’s new administration. If passed, it would add an extra
PHP10 per litre of sugary drinks, including products in both liquid and powder format, and this
excise would be imposed on top of the subsisting 12% VAT. The additional tax is also set to
have an incremental increase of 4% annually, effective from January 2017, should the bill be
passed.
Similar to House Bill 3365, House Bill 292 aims to reduce consumption of sugary beverages
while raising tax revenue. The high likelihood of House Bill 292 being passed lies in the
motivation of the Philippine government to reform its tax system. Despite all the considerable
discussion of the prospects for an excise tax on sugary drinks, at the time of writing, the bill had
not negatively affected the country’s soft drinks industry, with most categories such as
carbonates, RTD coffee and RTD tea, among others, registering positive volume and value
growth in 2016.
Outlook
If the additional excise tax on sugary drinks is eventually implemented, average unit prices in
categories with a high presence of sugary drinks such as carbonates, juice, RTD tea and RTD
coffee, as well as all other sugar-sweetened soft drinks categories, would increase by at least
PHP10 per litre. What is more, the additional tax would likely be passed on to consumers, which
means that cost-cutting measures from consumers would likely include further shifting towards
small pack sizes such as 230ml and 250ml. Even so, even beverages in small pack sizes such
as C2 Solo in 230ml PET bottle would cost more. For instance, C2 Solo would cost at least an
extra PHP2.30 per 230ml pack, although customers purchasing the product in 1-litre PET
bottles would then be forced to absorb the entire PHP10 excise tax. In 2016, off-trade volume
sales of soft drinks grew by 7%, while an off-trade volume CAGR of 4% is anticipated over the
forecast period. The positive growth anticipated in soft drinks is expected to be driven by the
stronger contribution of small pack sizes in carbonates and RTD tea, which would allow the
industry to achieve positive sales growth over the forecast period. As the tax is levied on a per-
litre basis, consumers are unlikely to forgo drinking soft drinks, instead opting for smaller pack
sizes in an effort to limit their absorption of the excise taxes. Moreover, manufacturers are also
expected to use cost-containment measures in order to maintain affordable pricing despite the
effects of the excise tax.
Stronger Health Focus Goes Beyond Reducing Sugar Consumption

As Philippine consumers generally aspire to being healthier, sugar content is no longer the
only relevant information they look for when purchasing soft drinks. Added vitamins, better
hydration, increased immunity and weight management are just some of the functions that
consumers now look for in their beverages. Specifically, some of the brands that performed well
in 2016 had added functions, which has enabled these brands to confer non-price related value
on consumers. For example, hydration products such as Gatorade and Pocari Sweat recorded
9% and 12% off-trade value growth respectively in 2016, while 100 Plus was relaunched in
sports drinks during the second half of 2016. Similarly, a functional bottled water brand that is
fortified with vitamins, B’lue, enjoyed a period of strong growth immediately after its launch in
2015 and it ended 2016 with robust growth.
Most notably, Asia Brewery’s Cobra has been the leading brand in energy drinks for many
years, although the brand has been able to push its other variants by clarifying the functional
benefits of these new variants. As an energy drinks brand, Cobra is expected by consumers to
be an energy booster, which its flagship variant and Berry Blast variant have proven able to
provide. What is more, other variants such as Cobra Plus Defense, Cobra Plus Fit and Cobra
Plus Smart offer non-identical product benefits beyond being an energy booster. Packaging
revitalisation has also boosted consumer interest in these three variants, which are only
available in PET bottles as the packaging shows the distinct uniqueness of every variant on a
per function basis. Specifically, Cobra Plus Defense positions itself as an immunity booster,
whereas Cobra Plus Fit and Cobra Plus Smart are focused on weight management and mental
alertness respectively. In 2016, the sales of Cobra in PET bottles improved, which contributed to
the recovery of the brand after volume sales recorded declines in 2015.
Outlook
The proliferation of functional products in soft drinks in the Philippines has contributed to the
positive outlook for functional bottled water, energy drinks, and sports drinks in the country.
Over the forecast period, functional bottled water is expected to post a 12% volume CAGR. The
activations undertaken for the B’lue brand are likely to help improve consumer awareness of
functional bottled water as a healthy alternative to other soft drinks products without skimping on
flavour. Meanwhile, energy drinks is expected to record an off-trade volume CAGR of 4% over
the forecast period, which is set to be faster than the growth recorded in the category over the
review period as Cobra is expected to be able to unlock demand among a new consumer
segment because of its functional properties. Finally, sports drinks is expected to post a 9% off-
trade volume CAGR over the forecast period, with growth set to be supported by the ongoing
fitness trend, which is expected to spur demand for beverages that can improve hydration.
MARKET DATA
Table 1 Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: Volume 2011-
2016
million litres
2011 2012 2013 2014 2015 2016
Off-trade 9,084.5 9,679.5 10,107.7 10,507.9 10,879.2 11,319.3

On-trade 1,759.9 1,839.1 1,910.8 1,983.4 2,054.9 2,149.7
Total 10,844.4 11,518.7 12,018.5 12,491.2 12,934.2 13,469.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 2 Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: % Volume

Growth 2011-2016
% volume growth
2015/16 2011-16 CAGR 2011/16 TOTAL
Off-trade 4.0 4.5 24.6

On-trade 4.6 4.1 22.1
Total 4.1 4.4 24.2
Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2011-2016
PHP million
2011 2012 2013 2014 2015 2016
Off-trade 160,476.8 174,419.9 191,925.9 205,522.6 214,686.0 237,960.9

On-trade 85,472.7 90,113.5 96,388.2 103,672.9 108,694.3 113,457.2
Total 245,949.5 264,533.4 288,314.1 309,195.5 323,380.3 351,418.1
Table 4 Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth 2011-
2016
% constant value growth

2015/16 2011-16 CAGR 2011/16 TOTAL
Off-trade 10.8 8.2 48.3

On-trade 4.4 5.8 32.7
Total 8.7 7.4 42.9
Table 5 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: Volume
2016
million litres
Off-trade On-trade TOTAL
Bottled Water 4,501.9 1,172.6 5,674.5

Carbonates 4,028.5 736.0 4,764.5
Concentrates 15.7 - 15.7
Juice 478.8 89.6 568.4
RTD Coffee 11.7 - 11.7
RTD Tea 358.7 84.2 442.9
Sports and Energy Drinks 385.5 67.3 452.8
Asian Speciality Drinks - - -
Soft Drinks 9,780.8 2,149.7 11,930.5
Note: Excludes powder concentrates
Table 6 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: % Volume
2016
% volume analysis
Off-trade On-trade Total

Bottled Water 79.3 20.7 100.0
Carbonates 84.6 15.4 100.0
Juice 84.2 15.8 100.0
RTD Coffee 100.0 - 100.0
RTD Tea 81.0 19.0 100.0
Soft Drinks 82.0 18.0 100.0
Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value 2016
PHP million
Off-trade On-trade TOTAL
Bottled Water 34,783.9 47,436.3 82,220.2

Carbonates 112,584.7 40,119.9 152,704.5
Concentrates 25,238.0 - 25,238.0
Juice 29,077.2 16,775.2 45,852.4
RTD Coffee 1,100.6 - 1,100.6
RTD Tea 14,076.7 5,293.9 19,370.6

Sports and Energy Drinks 21,099.7 3,832.0 24,931.7
Soft Drinks 237,960.9 113,457.2 351,418.1
Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value 2016
% value analysis
Off-trade On-trade Total

Carbonates 73.7 26.3 100.0
Juice 63.4 36.6 100.0
RTD Coffee 100.0 - 100.0
RTD Tea 72.7 27.3 100.0
Soft Drinks 67.7 32.3 100.0
Table 9 Off-trade Sales of Soft Drinks (RTD) by Category: Volume 2011-2016
million litres
2011 2012 2013 2014 2015 2016
Bottled Water 3,699.2 3,841.1 3,976.3 4,108.4 4,250.0 4,501.9

Carbonates 2,500.5 2,850.9 3,174.1 3,469.8 3,712.3 4,028.5
Concentrates 1,941.2 2,022.2 1,925.2 1,836.7 1,785.1 1,554.2
Juice 411.4 398.6 424.3 442.4 457.7 478.8
RTD Coffee 2.7 2.8 2.9 2.9 3.0 11.7
RTD Tea 244.1 240.0 270.0 288.5 304.0 358.7
Sports and Energy Drinks 285.3 323.9 335.0 359.1 367.2 385.5
Asian Speciality Drinks - - - - - -
Soft Drinks 9,084.5 9,679.5 10,107.7 10,507.9 10,879.2 11,319.3
Table 10 Off-trade Sales of Soft Drinks (RTD) by Category: % Volume Growth 2011-
2016
% volume growth
2015/16 2011-16 CAGR 2011/16 Total

Carbonates 8.5 10.0 61.1
Concentrates -12.9 -4.3 -19.9
Juice 4.6 3.1 16.4
RTD Coffee 286.8 33.9 331.0
RTD Tea 18.0 8.0 47.0
Soft Drinks 4.0 4.5 24.6

Table 11 Off-trade Sales of Soft Drinks by Category: Value 2011-2016
PHP million
2011 2012 2013 2014 2015 2016
Bottled Water 23,779.5 25,268.2 26,889.3 28,439.6 30,235.6 34,783.9

Carbonates 65,464.4 75,265.6 85,153.0 94,709.8 101,122.5 112,584.7
Concentrates 20,581.0 21,792.2 22,688.8 23,650.2 24,840.6 25,238.0
Juice 24,213.8 24,091.8 25,949.8 26,800.2 27,542.6 29,077.2
RTD Coffee 289.9 312.5 326.6 344.5 321.0 1,100.6
RTD Tea 10,837.7 10,533.3 12,163.3 11,354.5 10,527.8 14,076.7
Sports and Energy Drinks 15,310.5 17,156.4 18,755.1 20,223.7 20,096.0 21,099.7
Soft Drinks 160,476.8 174,419.9 191,925.9 205,522.6 214,686.0 237,960.9
Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth 2011-2016
% current value growth

2015/16 2011-16 CAGR 2011/16 Total

Concentrates 1.6 4.2 22.6
Juice 5.6 3.7 20.1
RTD Coffee 242.9 30.6 279.7
RTD Tea 33.7 5.4 29.9
Table 13 Total Sales of Soft Drinks by Fountain On-trade: Volume 2011-2016
million litres
2011 2012 2013 2014 2015 2016
Total Fountain On-trade 473.8 490.5 508.0 526.7 544.6 561.1

Table 14 Total Sales of Soft Drinks by Fountain On-trade: % Volume Growth 2011-
2016
% fountain volume growth

2015/16 2011-16 CAGR 2011/16 TOTAL
Total Fountain On-trade 3.0 3.4 18.4

Table 15 NBO Company Shares of Off-trade Soft Drinks (RTD): % Volume 2012-2016
% off-trade volume
Company 2012 2013 2014 2015 2016
Coca-Cola Export Corp, 21.4 22.7 24.5 25.0 26.6

The
Pepsi-Cola Products 7.6 9.4 11.1 11.9 12.8
Philippines Inc
Asia Brewery Inc 4.4 4.6 4.7 4.7 5.2
Kraft Foods 7.1 6.9 6.7 6.6 4.8
(Philippines) Inc
Nestlé Philippines Inc 6.9 6.2 5.6 5.1 3.8
Asiawide Refreshments 3.0 3.1 3.1 3.2 3.2
Corp
Universal Robina Corp 2.1 2.4 2.6 2.6 2.9
Philippine Spring Water 1.4 1.5 1.5 1.7 2.0
Resources Inc
Zest-O Corp 1.8 1.7 1.7 1.7 1.7
Del Monte Philippines Inc 1.1 1.0 1.0 1.0 1.0
Cosmos Bottling Corp 4.7 3.4 1.3 0.9 0.8
Co-Ro Food A/S 0.6 0.6 0.5 0.5 0.5
Danone Universal Robina - - - 0.1 0.3
Beverages
Bintang Toedjoe PT 0.2 0.2 0.2 0.1 0.1
Cenmaco Inc 0.2 0.1 0.1 0.1 0.1
Ginebra San Miguel Inc 0.2 0.2 0.2 0.1 0.1
RFM Corp 1.0 0.5 0.2 0.2 0.1
Unilever Philippines Inc 0.2 0.1 0.1 0.1 0.1
SM Retail Inc 0.1 0.1 0.1 0.1 0.1
Pokka Corp 0.1 0.1 0.1 0.0 0.1
Tirta Fresindo Jaya PT - - - 0.0 0.1
Dole Philippines Inc 0.1 0.0 0.0 0.0 0.0
Profood International 0.0 0.0 0.0 0.0 0.0
Corp
Pfanner Getränke GmbH, 0.0 0.0 0.0 0.0 0.0
Hermann
TC Pharmaceutical 0.0 0.0 0.0 0.0 0.0
Industry Co Ltd
Nestlé SA 0.0 0.0 0.0 0.0 0.0
Alternative Beverage - - - - -
Co, The
Nestlé Waters - - - - -
Philippines Inc
Marsman-Drysdale Foods - - - - -
Corp
PepsiCo International Inc - - - - -
Others 35.9 35.2 34.5 34.0 33.6
Total 100.0 100.0 100.0 100.0 100.0
Table 16 LBN Brand Shares of Off-trade Soft Drinks (RTD): % Volume 2013-2016
% off-trade volume
Brand (GBO) Company (NBO) 2013 2014 2015 2016
Coca-Cola (Coca- Coca-Cola Export Corp, 8.8 10.6 10.8 11.0

Cola Co, The) The
Mountain Dew Pepsi-Cola Products 3.1 3.8 4.4 5.2
(PepsiCo Inc) Philippines Inc
Royal Tru-Orange Coca-Cola Export Corp, 3.8 3.9 4.1 4.8
(Coca-Cola Co, The) The
Tang (Mondelez Kraft Foods 6.9 6.7 6.6 4.8
International Inc) (Philippines) Inc
Pepsi (PepsiCo Inc) Pepsi-Cola Products 3.7 4.5 4.6 4.7
Philippines Inc
Sprite (Coca-Cola Coca-Cola Export Corp, 3.8 4.0 4.2 4.3
Co, The) The
Eight O'Clock (Coca- Coca-Cola Export Corp, 3.5 3.0 2.7 3.3
Cola Co, The) The
RC Cola (Cott Corp) Asiawide Refreshments Corp 3.1 3.1 3.2 3.2
Nestea (Nestlé SA) Nestlé Philippines Inc 5.8 5.1 4.4 3.1
C2 (JG Summit Universal Robina Corp 2.1 2.3 2.3 2.6
Holdings Inc)
Absolute Asia Brewery Inc 1.6 1.7 1.8 2.1
Nature's Spring Philippine Spring Water 1.5 1.5 1.7 2.0
Resources Inc
Cobra Asia Brewery Inc 1.9 1.8 1.7 1.7
Wilkins (Coca-Cola Coca-Cola Export Corp, 1.4 1.5 1.6 1.7
Co, The) The
Summit Asia Brewery Inc 1.1 1.2 1.2 1.4
Gatorade (PepsiCo Pepsi-Cola Products 0.9 1.0 1.1 1.2
Inc) Philippines Inc
Del Monte (Del Del Monte Philippines Inc 1.0 1.0 1.0 1.0
Monte Pacific Ltd)
Zest-O Zest-O Corp 0.8 0.8 0.8 0.8
Viva! (Coca-Cola Coca-Cola Export Corp, 0.6 0.6 0.7 0.7
Co, The) The
Nesfruta (Nestlé SA) Nestlé Philippines Inc 0.3 0.4 0.6 0.7
7-Up (PepsiCo Inc) Pepsi-Cola Products 0.5 0.5 0.5 0.5
Philippines Inc
Sparkle (Coca-Cola Cosmos Bottling Corp 0.5 0.5 0.5 0.5
Co, The)
Sunquick Co-Ro Food A/S 0.6 0.5 0.5 0.5
Sting (PepsiCo Inc) Pepsi-Cola Products 0.5 0.5 0.5 0.5
Philippines Inc
Sun Glo Zest-O Corp 0.4 0.4 0.4 0.3
Coca-Cola Zero Coca-Cola Export Corp, 0.3 0.3 0.3 0.3
Tropicana Twister Pepsi-Cola Products 0.3 0.3 0.3 0.3
B'lue Danone Universal Robina - - 0.1 0.3
Beverages
Coca-Cola Light Coca-Cola Export Corp, 0.3 0.3 0.3 0.3
Hidden Spring (JG Universal Robina Corp 0.2 0.2 0.2 0.2
Summit Holdings Inc)
Others Others 40.9 37.8 36.7 36.2
Total Total 100.0 100.0 100.0 100.0
Table 17 NBO Company Shares of Off-trade Soft Drinks: % Value 2012-2016
% off-trade value rsp

Company 2012 2013 2014 2015 2016
Coca-Cola Export Corp, 28.7 30.0 32.6 33.6 33.5

The
Pepsi-Cola Products 14.3 16.4 18.1 18.8 19.4
Philippines Inc
Asia Brewery Inc 8.8 8.7 8.8 8.5 8.5
Universal Robina Corp 4.7 5.3 4.9 4.3 5.0
Kraft Foods 4.4 4.4 4.4 4.6 4.3
(Philippines) Inc
Del Monte Philippines Inc 4.5 4.2 4.0 4.0 3.9
Asiawide Refreshments 3.7 3.8 4.0 4.1 3.8
Corp
Nestlé Philippines Inc 4.3 4.0 3.9 4.0 3.8
Zest-O Corp 2.7 2.6 2.4 2.3 2.1
Philippine Spring Water 1.9 1.8 1.8 1.9 2.1
Resources Inc
Cosmos Bottling Corp 6.8 4.8 1.9 1.4 1.1
Cenmaco Inc 0.8 0.7 0.7 0.7 0.6
Co-Ro Food A/S 0.8 0.7 0.7 0.7 0.6
Danone Universal Robina - - - 0.2 0.6
Beverages
Ginebra San Miguel Inc 0.6 0.6 0.6 0.5 0.5
RFM Corp 0.9 0.7 0.5 0.4 0.3
Pokka Corp 0.4 0.3 0.2 0.1 0.2
Dole Philippines Inc 0.3 0.2 0.2 0.2 0.2
Tirta Fresindo Jaya PT - - - 0.0 0.2
Bintang Toedjoe PT 0.3 0.2 0.2 0.2 0.2
Pfanner Getränke GmbH, 0.2 0.2 0.2 0.2 0.2
Hermann
TC Pharmaceutical 0.1 0.1 0.1 0.1 0.1
Industry Co Ltd
Nestlé SA 0.1 0.1 0.1 0.1 0.1
Profood International 0.1 0.1 0.1 0.1 0.1
Corp
SM Retail Inc 0.1 0.1 0.1 0.1 0.1
Unilever Philippines Inc 0.1 0.1 0.1 0.1 0.1
Alternative Beverage - - - - -
Co, The
Nestlé Waters - - - - -
Philippines Inc
Marsman-Drysdale Foods - - - - -
Corp
PepsiCo International Inc - - - - -
Others 10.4 9.8 9.3 9.0 8.5
Total 100.0 100.0 100.0 100.0 100.0
Table 18 LBN Brand Shares of Off-trade Soft Drinks: % Value 2013-2016
% off-trade value rsp

Brand (GBO) Company (NBO) 2013 2014 2015 2016
Coca-Cola (Coca- Coca-Cola Export Corp, 12.2 14.3 14.6 14.0

Cola Co, The) The
Mountain Dew Pepsi-Cola Products 4.4 5.2 5.9 7.0
Royal Tru-Orange Coca-Cola Export Corp, 5.4 5.6 5.9 6.7
Sprite (Coca-Cola Coca-Cola Export Corp, 5.5 5.8 6.1 6.0
Co, The) The
Pepsi (PepsiCo Inc) Pepsi-Cola Products 5.3 6.2 5.9 5.6
Philippines Inc
C2 (JG Summit Universal Robina Corp 4.9 4.5 3.9 4.7
Holdings Inc)
Cobra Asia Brewery Inc 5.5 5.4 4.7 4.4
Tang (Mondelez Kraft Foods 4.4 4.4 4.6 4.3
International Inc) (Philippines) Inc
Del Monte (Del Del Monte Philippines Inc 4.2 4.0 4.0 3.9
Monte Pacific Ltd)
RC Cola (Cott Corp) Asiawide Refreshments Corp 3.8 4.0 4.1 3.8
Nestea (Nestlé SA) Nestlé Philippines Inc 3.7 3.6 3.6 3.2
Gatorade (PepsiCo Pepsi-Cola Products 2.6 2.8 3.0 3.0
Inc) Philippines Inc
Absolute Asia Brewery Inc 2.0 2.1 2.3 2.7
Wilkins (Coca-Cola Coca-Cola Export Corp, 2.1 2.2 2.4 2.4
Co, The) The
Nature's Spring Philippine Spring Water 1.8 1.8 1.9 2.1
Resources Inc
Eight O'Clock (Coca- Coca-Cola Export Corp, 2.0 1.8 1.7 1.6
Cola Co, The) The
Summit Asia Brewery Inc 1.2 1.3 1.4 1.4
Zest-O Zest-O Corp 1.4 1.3 1.2 1.2
Sting (PepsiCo Inc) Pepsi-Cola Products 1.2 1.2 1.2 1.1
Philippines Inc
Tropicana Twister Pepsi-Cola Products 1.1 1.1 1.1 1.1
Viva! (Coca-Cola Coca-Cola Export Corp, 0.8 0.8 0.8 0.7
Co, The) The
7-Up (PepsiCo Inc) Pepsi-Cola Products 0.6 0.6 0.7 0.7
Philippines Inc
Sparkle (Coca-Cola Cosmos Bottling Corp 0.9 0.9 0.9 0.7
Co, The)
Gina Cenmaco Inc 0.7 0.7 0.7 0.6
Coca-Cola Zero Coca-Cola Export Corp, 0.6 0.6 0.6 0.6
Sunquick Co-Ro Food A/S 0.7 0.7 0.7 0.6
B'lue Danone Universal Robina - - 0.2 0.6
Beverages
Coca-Cola Light Coca-Cola Export Corp, 0.6 0.6 0.6 0.6
Minute Maid (Coca- Coca-Cola Export Corp, 0.4 0.5 0.5 0.5
Cola Co, The) The
Sun Glo Zest-O Corp 0.4 0.4 0.4 0.4
Others Others 19.5 15.7 14.5 13.8
Total Total 100.0 100.0 100.0 100.0
Table 19 Penetration of Private Label in Off-trade Soft Drinks (RTD) by Category: %

Volume 2011-2016
% retail rtd volume

2011 2012 2013 2014 2015 2016
Concentrates 0.5 0.5 0.3 0.3 0.4 0.7

Soft Drinks 0.1 0.1 0.1 0.1 0.1 0.1
Table 20 Penetration of Private Label in Off-trade Soft Drinks by Category: % Value

2011-2016
% retail value rsp

2011 2012 2013 2014 2015 2016
Concentrates 1.0 1.0 0.9 0.9 0.9 0.8

Soft Drinks 0.1 0.1 0.1 0.1 0.1 0.1
Table 21 Distribution of Off-trade Soft Drinks (as sold) by Format and Category: %
Volume 2016
% off-trade
BW CB CN JU RC RT
Store-Based Retailing 15.9 100.0 100.0 100.0 100.0 100.0

- Grocery Retailers 15.9 100.0 100.0 100.0 100.0 100.0
-- Modern Grocery 5.5 11.6 90.0 40.0 82.0 59.9
Retailers
--- Convenience Stores 0.2 0.2 3.4 0.9 35.0 7.8
--- Discounters 0.0 0.0 0.0 0.0 0.0 0.0
--- Forecourt Retailers 0.0 0.4 0.0 0.2 0.2 0.5
--- Hypermarkets 1.1 1.3 10.0 3.9 7.0 6.2
--- Supermarkets 4.1 9.7 76.6 35.1 39.8 45.4
-- Traditional Grocery 10.5 88.4 10.0 60.0 18.0 40.1
Retailers
--- Food/drink/tobacco 0.0 0.0 0.0 0.0 0.0 0.0
specialists
--- Independent Small 4.1 9.7 5.0 32.0 8.8 13.3
Grocers
--- Other Grocery 6.3 78.8 5.0 28.0 9.2 26.8
Retailers
- Mixed Retailers 0.0 0.0 0.0 0.0 0.0 0.0
- Non-Grocery Specialists 0.0 0.0 0.0 0.0 0.0 0.0
Non-Store Retailing 84.1 0.0 0.0 0.0 0.0 0.0
- Vending 0.0 0.0 0.0 0.0 0.0 0.0
- Homeshopping 0.0 0.0 0.0 0.0 0.0 0.0
- Internet Retailing 0.0 0.0 0.0 0.0 0.0 0.0
- Direct Selling 84.1 0.0 0.0 0.0 0.0 0.0
Total 100.0 100.0 100.0 100.0 100.0 100.0
SE AS
Store-Based Retailing 100.0 0.0

- Grocery Retailers 100.0 0.0
-- Modern Grocery 33.9 0.0
Retailers
--- Convenience Stores 9.5 0.0

--- Discounters 0.0 0.0
--- Forecourt Retailers 0.6 0.0
--- Hypermarkets 3.9 0.0
--- Supermarkets 20.0 0.0
-- Traditional Grocery 66.1 0.0
Retailers
--- Food/drink/tobacco 0.0 0.0
specialists
--- Independent Small 5.3 0.0
Grocers
--- Other Grocery 60.8 0.0
Retailers
- Mixed Retailers 0.0 0.0
- Non-Grocery Specialists 0.0 0.0
Non-Store Retailing 0.0 0.0
- Vending 0.0 0.0
- Homeshopping 0.0 0.0
- Internet Retailing 0.0 0.0
- Direct Selling 0.0 0.0
Total 100.0 0.0
Key: BW = bottled water; CB = carbonates; CN = concentrates; JU = juice; RC = RTD coffee; RT = RTD tea;
SE = sports and energy drinks; AS = Asian speciality drinks
Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel:

Volume 2016-2021
million litres
2016 2017 2018 2019 2020 2021
Off-trade 11,319.3 11,694.7 12,062.6 12,482.1 12,945.6 13,432.7

On-trade 2,149.7 2,190.0 2,252.4 2,332.1 2,429.8 2,537.6
Total 13,469.0 13,884.6 14,315.0 14,814.2 15,375.4 15,970.3
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: %

Volume Growth 2016-2021
% volume growth
2016/17 2016-21 CAGR 2016/21 TOTAL
Off-trade 3.3 3.5 18.7

On-trade 1.9 3.4 18.0
Total 3.1 3.5 18.6
trade sources
Table 24 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2016-
2021
PHP million
2016 2017 2018 2019 2020 2021
Off-trade 237,960.9 233,247.7 238,433.4 244,691.1 251,696.8 260,898.8

On-trade 113,457.2 116,931.3 120,025.1 123,938.2 128,655.8 135,788.5
Total 351,418.1 350,179.1 358,458.6 368,629.3 380,352.6 396,687.2
trade sources
Table 25 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value

Growth 2016-2021

2016/17 2016-21 CAGR 2016/21 TOTAL
Off-trade -2.0 1.9 9.6

On-trade 3.1 3.7 19.7
Total -0.4 2.5 12.9
trade sources
Table 26 Forecast Off-trade Sales of Soft Drinks (RTD) by Category: Volume 2016-
2021
million litres
2016 2017 2018 2019 2020 2021
Bottled Water 4,501.9 4,606.0 4,749.1 4,919.5 5,110.8 5,316.4

Carbonates 4,028.5 4,051.3 4,271.8 4,503.6 4,747.3 4,993.3
Concentrates 1,554.2 1,822.1 1,787.3 1,757.9 1,732.8 1,708.0
Juice 478.8 470.0 476.7 486.7 499.2 513.3
RTD Coffee 11.7 19.6 25.4 28.5 30.1 31.2
RTD Tea 358.7 322.1 328.7 338.1 348.6 359.5
Sports and Energy Drinks 385.5 403.5 423.6 447.6 476.9 511.0
Soft Drinks 11,319.3 11,694.7 12,062.6 12,482.1 12,945.6 13,432.7
trade sources
Table 27 Forecast Off-trade Sales of Soft Drinks (RTD) by Category: % Volume Growth
2016-2021
% volume growth
2016/17 2016-21 CAGR 2016/21 Total

Juice -1.8 1.4 7.2
RTD Coffee 67.8 21.7 167.2
RTD Tea -10.2 0.0 0.2
trade sources
Table 28 Forecast Off-trade Sales of Soft Drinks by Category: Value 2016-2021
PHP million
2016 2017 2018 2019 2020 2021
Bottled Water 34,783.9 35,506.3 36,184.4 37,091.6 38,046.1 39,211.6

Carbonates 112,584.7 104,691.3 107,335.0 110,373.8 113,765.4 118,382.9
Concentrates 25,238.0 26,170.4 26,035.1 25,942.8 25,846.2 25,646.4
Juice 29,077.2 28,849.3 28,912.0 29,275.3 29,937.8 31,143.9
RTD Coffee 1,100.6 1,890.3 2,433.2 2,722.3 2,854.9 2,949.9
RTD Tea 14,076.7 14,047.3 14,365.5 14,793.3 15,173.3 15,616.0
Sports and Energy Drinks 21,099.7 22,092.8 23,168.1 24,492.1 26,073.1 27,948.0
Soft Drinks 237,960.9 233,247.7 238,433.4 244,691.1 251,696.8 260,898.8
trade sources
Table 29 Forecast Off-trade Sales of Soft Drinks by Category: % Value Growth 2016-
2021

2016/2017 2016-21 CAGR 2016/21 TOTAL

Carbonates -7.0 1.0 5.2
Juice -0.8 1.4 7.1
RTD Coffee 71.8 21.8 168.0
RTD Tea -0.2 2.1 10.9
Soft Drinks -2.0 1.9 9.6
trade sources
Table 30 Forecast Total Sales of Soft Drinks by Fountain On-trade: Volume 2016-2021
million litres
2016 2017 2018 2019 2020 2021
Total Fountain On-trade 561.1 577.5 592.3 605.9 617.8 629.3

trade sources
Table 31 Forecast Total Sales of Soft Drinks by Fountain On-trade: % Volume Growth
2016-2021
% fountain volume growth

2016/17 2016-21 CAGR 2016/21 TOTAL
Total Fountain On-trade 2.9 2.3 12.2
trade sources
APPENDIX
Fountain Sales in the Philippines
Trends
 In 2016, total fountain on-trade volume sales of soft drinks expanded by 3%, which was in line
with the growth recorded in 2015. The slowdown seen in outlet volume and transaction
volume growth in fast food in the Philippines in 2016 suppressed growth in fountain on-trade
volume sales of soft drinks, especially as full-service restaurants and independent street
stalls/kiosks in the country usually sell packaged soft drinks.
 As the bulk of on-trade fountain sales of soft drinks are accounted for by carbonates, The
Coca-Cola Export Corp and Pepsi-Cola Products Philippines led fountain sales of soft drinks
in 2016. While Del Monte Pineapple is the most popular pineapple juice brand in most
chained fast food outlets, RTD tea could be either Lipton or Nestea, while carbonates are
usually exclusive to either Pepsi or Coca-Cola. For example, Chinese fast food chain
Chowking sells regular and low-calorie carbonates alongside Del Monte pineapple juice and
Lipton RTD tea.
 Over the forecast period, growth in total fountain on-trade volume sales is expected to slow
down to a CAGR of 2%, slower than the 3% volume CAGR recorded over the review period.
Rising disposable income levels among the Philippine population are set to result in Filipinos
dining out more frequently, which in turn is likely to support growth in consumer foodservice,
meaning that the outlook for fountain sales of soft drinks is almost certainly positive.
DEFINITIONS
Explanations of words and/or terminology used in this report are as follows:
 Carinderias: traditional eateries targeting mass consumers, serving rice and viands.
 Sari-sari stores: traditional independent small grocers outlets.
 Baon: money, food, or other provisions taken to school, work, or on a journey.
SOURCES
Sources used during the research included the following:
Summary 1 Research Sources

Official Sources Department of Trade & Industry
National Statistics Office
United States Department of Agriculture
(USDA) Foreign Agricultural Service (FAS)
Trade Associations Asia Bottled Water Association
Beverage Industry Association of the
Philippines
International Bottled Water Association

International Federation of Fruit Juice
Producers
UNESDA & CISDA
Trade Press Beverage Net
Beverage World
BeverAsia
Business Week Mindanao
Business World
Enterprise Magazine
Manila Bulletin, The
Philippine Daily Inquirer, The
Philippine Star, The
Soft Drinks International
Source: Euromonitor International

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SOFT DRINKS IN THE

LIST OF CONTENTS AND TABLES

Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by

SOFT DRINKS IN THE PHILIPPINES

Soft Drinks Posts Stronger Growth in 2016

Consumers Remain Price Conscious Despite Rising Affluence

the Coca-Cola Export Corp Maintains Market Leadership in Soft Drinks

Key New Product Launches Successfully Tap Into Demand Among

Growth in Soft Drinks Is Expected To Slow Down Over the Forecast

KEY TRENDS AND DEVELOPMENTS

New Product Launches Successfully Tap Into Demand Among Young

Additional Excise Tax on Sugary Drinks Is Becoming More Likely

Stronger Health Focus Goes Beyond Reducing Sugar Consumption

Off-trade 9,084.5 9,679.5 10,107.7 10,507.9 10,879.2 11,319.3

Table 2 Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: % Volume

Off-trade 4.0 4.5 24.6

Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value 2011-2016

Off-trade 160,476.8 174,419.9 191,925.9 205,522.6 214,686.0 237,960.9

% constant value growth

Off-trade 10.8 8.2 48.3

Bottled Water 4,501.9 1,172.6 5,674.5

Asian Speciality Drinks - - -

Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value 2016

Bottled Water 34,783.9 47,436.3 82,220.2

RTD Tea 14,076.7 5,293.9 19,370.6

Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value 2016

Asian Speciality Drinks - - -

Table 9 Off-trade Sales of Soft Drinks (RTD) by Category: Volume 2011-2016

Bottled Water 3,699.2 3,841.1 3,976.3 4,108.4 4,250.0 4,501.9

Bottled Water 5.9 4.0 21.7

Soft Drinks 4.0 4.5 24.6

Table 11 Off-trade Sales of Soft Drinks by Category: Value 2011-2016

Bottled Water 23,779.5 25,268.2 26,889.3 28,439.6 30,235.6 34,783.9

Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth 2011-2016

% current value growth

Bottled Water 15.0 7.9 46.3

Table 13 Total Sales of Soft Drinks by Fountain On-trade: Volume 2011-2016

Total Fountain On-trade 473.8 490.5 508.0 526.7 544.6 561.1

% fountain volume growth

Total Fountain On-trade 3.0 3.4 18.4

Coca-Cola Export Corp, 21.4 22.7 24.5 25.0 26.6

Coca-Cola (Coca- Coca-Cola Export Corp, 8.8 10.6 10.8 11.0

Table 17 NBO Company Shares of Off-trade Soft Drinks: % Value 2012-2016

% off-trade value rsp

Coca-Cola Export Corp, 28.7 30.0 32.6 33.6 33.5

Table 18 LBN Brand Shares of Off-trade Soft Drinks: % Value 2013-2016

% off-trade value rsp

Coca-Cola (Coca- Coca-Cola Export Corp, 12.2 14.3 14.6 14.0

Table 19 Penetration of Private Label in Off-trade Soft Drinks (RTD) by Category: %

% retail rtd volume

Concentrates 0.5 0.5 0.3 0.3 0.4 0.7

Table 20 Penetration of Private Label in Off-trade Soft Drinks by Category: % Value

% retail value rsp

Concentrates 1.0 1.0 0.9 0.9 0.9 0.8

Store-Based Retailing 15.9 100.0 100.0 100.0 100.0 100.0

Store-Based Retailing 100.0 0.0

--- Convenience Stores 9.5 0.0

Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel:

Off-trade 11,319.3 11,694.7 12,062.6 12,482.1 12,945.6 13,432.7

Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks (RTD) by Channel: %

Off-trade 3.3 3.5 18.7

Off-trade 237,960.9 233,247.7 238,433.4 244,691.1 251,696.8 260,898.8