Rob and I learned about the concept “Share of Stomach” while attending the 2017 Beverage Forum held in Chicago last April. What is “Share of Stomach”? Good question. “Share of Stomach” is an economic model used by national beverage marketing organizations. This model assumes each consumer drinks 1/2 gallon (approx. 2 liters or 64 ounces) of liquid per day. Based on sales receipts, the marketing organizations breakdown how much consumers drink of each beverage type (e.g., wine, bottled water, soda). This breakdown by beverage type represents, “share of stomach.” Certainly someone can drink 1/2 gallon of liquid (more or less) each day. It’s important to realize our stomach capacity has some limitations … which makes it even more important to drink value-added clean beverages (majority of the Stomach Share) when we have the opportunity. As a wise doctor would advise, “Drink the purest water you can get your hands on.”
Most consumers today seem to trend towards healthier beverage choices. Based on the 2016 volume trends, the majority of beverage types – both alcoholic and non-alcoholic – struggled with growth except bottled water, value-added water, and ready-to-drink coffee (all of which thrived). Tap water experienced historic growth during the 2007/08 recession but has since been on a decline with over 9% reduction in “Share of Stomach” in 2016. A quote from the Beverage Marketing Corporation (BMC): “Over the last five years, bottled water has increased its share of stomach by more than five share points, capturing the undisputed No. 1 position.”
The sales volume on soda (carbonated soft drinks or CSDs) started to decline over 16 years ago; however, the revenues have increased modestly in the last couple of years. Why? It appears that a combination of smaller cans having a higher per ounce cost and the higher price points of convenience stores are supporting the soda profits. Surprisingly, the volume growth in beer, despite growth in craft beer, is sluggish, while there was modest volume growth in both wine and spirits during 2016.
The consumer trends towards “lifestyle” beverages land inside AquaNew’s wheelhouse including: 1) private labels in the retail PET water segment continue to make inroads in the market, 2) value-added or enhanced waters continue to gain traction, 3) sports and energy drinks have experienced a slowdown within the drink market and need innovation to attract additional core customers, including women who are searching for healthier alternatives, and 4) premium and ultra-premium bottled waters are helping to fuel historic growth of both the still and sparkling bottled water segment.
According to the BMC (Beverage Industry Magazine, July 2017), bottled water reached an all-time record of over 20% of the Stomach Share in 2017. “There are a lot of drivers but the No. 1 is health and wellness,” said BMC’s Managing Director of Research Gary Hemphill. He continued: “It’s virtually perfect when it comes to bottled water, so that’s been the greatest driver of bottled water performance this year and historically.”
This Ahh-Mazing “AHA!” Discovery focuses on the concept of “Share of Stomach,” which makes us realize the healthy value of being discriminating in what beverages we drink each day.
What part of your daily “Share of Stomach” is good pure water?
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