It seems like eons ago that Kraft’s MiO innovation created renewed excitement for flavour enhancers and launched a new beverage segment. In reality this was only five years ago. MiO’s introduction was founded on insights around convenience, customization, and portability. The fact that the product was encased in a tiny plastic bottle and featured an unconventional delivery system also helped drive these insights home. In the years since 2011, the public witnessed the rise, peak, and decline of liquid enhancers. This doesn’t necessarily mean that liquid enhancers will disappear from the marketplace, only that there is reduced potential and everyone must work harder to grow sales and profits.
MiO was the beverage industry’s darling when it launched, but success was short-lived as other trends overshadowed its growth potential. Consumers became increasingly health-conscious and shifted their consumption habits to other drinks like sparkling water, cold-pressed juices, and cold brew coffee to name a few. Manufacturers and retailers responded by pivoting to these categories in addition to the brands focusing on their basic day-to-day business. Dasani launched Dasani Sparkling with a renewed vigor to tap into the explosive sparkling water category. Powerade concentrated on commercializing more flavours to improve shelf presence in the fragmented recovery drinks space. Nestea strengthened their base business with more tea flavours. Business transformation turned Kraft into Kraft Heinz, resulting in greater emphasis on their hot beverage brands like Maxwell House, Nabob, and Tassimo.
The declining presence of liquid enhancers is today’s reality, but it doesn’t need to be tomorrow’s. Consumers desires of convenience and customization can still be met with these products yet the issue is product awareness and visibility. They may not end up on shopping lists so the primary sales driver is impulse-driven through in-store prompting. Merchandising with all things water makes sense. Bottled water is flavorless and non-carbonated, which is why sparkling and flavoured water have immense appeal. Occasion-based marketing help illustrate different uses to compliment an individual’s on-the-go lifestyle or socializing moments. In-store sampling and drink mix recipes present another option to spur consumption. Streamlining the product selection is still an option for retailers to balance sales with spacing profitability.
Liquid enhancers is now a stabilized product segment. While Super Bowl commercials are no longer justified, some marketing support can quickly remind the public of product benefits. Consumers have enjoyed its greater convenience and customization. Retailers and manufacturers have generated tremendous sales and profits. For an innovation that only launched in 2011, there is still opportunity to improve its outlook. Even if it is no longer the beverage industry’s darling, there are many options to sustain consumer demand. And with many manufacturers shifting their attention elsewhere, now may be the time for a select few to capitalize on winning the segment.