Empresas Ciativas

COMPANY AND PRODUCT OVERVIEW

Company history

“We started innocent in 1999 after selling our smoothies at a music festival. We put up a big sign asking people if they thought we should give up our jobs to make smoothies, and put a bin saying 'Yes' and a bin saying 'No" in front of the stall. Then we got people to vote with their empties. At the end of the weekend, the 'Yes' bin was full, so we resigned from our jobs the next day and got cracking.

Since then we've started making veg pots, juices and kids' drinks, in our quest to make natural, delicious, healthy foods that help people live well and die old.” (Innocent, 2014).

In April 2009 Innocent Drinks sold a stake of 18% to The Coca-Cola Company which was then increased in April 2010 to 58% with the three founders retaining full operational control over the company. In February 2014 Coca-Cola took full control of innocent increasing its stake to almost 100 per cent.

Smoothies

There is currently no legal definition of what constitutes a smoothie and manufacturers’ opinions regarding this question are divided. For the purposes of this report, Mintel has defined a smoothie as a drink that is made with pure crushed fruit, but which may also include a small amount of fruit juice or purée, yogurt, milk or soymilk and is smooth in texture. (Mintel, 2013)

Sustainability

“We strive to do business in a more enlightened way, where we take responsibility for the impact of our business on society and the environment, aiming to move these impacts from negative to neutral or (better still) positive. It's part of our quest to become a truly sustainable business where we have a net positive effect on the world around us.” (Innocent, 2014b)

The business strategy is based on sustainable brand, ingredients, production, packaging and legacy.

Product categories

The Innocent brand is still very much associated with smoothies, but the company has since diversified its range and today’s products are divided in 6 Categories: smoothies; juice; kids fruity water: noodle pots; veg pots and fruit tubes. (Innocent, 2014a)

Smoothies

Innocent makes 4 different types of smoothies:

Smoothies (classic): 100% pure fruit smoothies. No added sugar. No concentrates. Portion of 5 a day - 1 portion in 180ml and 2 of your 5 a day in 250ml.

Super Smoothies: A super smoothie is a healthy blend of fruit, veg. botanicals, guarana and crushed flax seeds, with added vitamins B1, B2, B3, B6 and C.

Extra Juice Smoothies: A brand new range of smoothies made from 100% pure fruit, blended carefully to make it a bit more refreshing than our regular fruit smoothies. Three delicious thirst-quenching new recipes (strawberries, blackberries and raspberries).

Kids Smoothies: Just like our grown up smoothies, but with recipes specially selected for small people.

Figure 1: Products from Innocent Drinks

Smoothies

Super Smoothies Extra Juice Smoothies

Kids Smoothies Juice Kids Juice

Kids fruity water Noodle pots Veg Pots:

MARKET SIZE, TRENDS AND SEGMENTATION

The smoothie market is dominated by the Innocent brand, which was responsible for 78% of sales despite the smoothie sector decrease. This was followed by own-label versions, which made up a further 13 per cent (Levy, 2012).

In 2007, the smoothie market was worth £210 million each year. Now, this has plummeted to £153 million, down almost a third.

Innocent smoothie sales dropped 15.5% year on year to £94.8m for the 52 weeks ending 4 January 2014, according to figures from IRI.

Premium prices for the fruit drinks is the biggest block to people dropping them into their shopping baskets, with 82 per cent of consumers saying they would buy them more often if they were cheaper, according to research by retail analyst Mintel (Levy, 2012)

‘The future of the market is likely to remain centred around the health proposition of smoothies, catering for consumers looking for a convenient and transparent way of achieving their five-a-day.’ (Levy, 2012)

GROCERY AND CONVENIENCE CHANNEL (take-home)

Figure 2: Soft Drinks Distribution Channels

Soft drinks fared considerably better than other categories, with value sales climbing by a steady 2% to reach £10.3bn. Soft drinks saw the highest value sales growth of all FMCG categories, demonstrating the continued relevancy and versatility of the category.

The take-home smoothie sector decreased in value by 4.0 per cent year on year in 2013 to £153m in value sales, while volume decreased by 5.5 per cent, according to the Britvic Soft Drinks Review 2014 (Table 1).

Innocent reported value sales of £213.5m in 2012 across grocery, convenience and impulse, a market leading leap of 36.6% on the year before. In 2013 sales reached £216,4m, an increase of 1.4% (Table 3). Innocent’s performance was aided by its move into the pure juice category.

Table 1: Soft Drinks (2012-2013) – Total Grocery & Convenience Channel

Total Grocery & Convenience 2013 2012

£ % % £ % %

Value millions share change millions share change

Cola 1,610.1 21.5 2.7 1,568.0 21.8 2.0

Cold hot drinks 50.7 0.7 47.0 34.0 0.5 42.3

Dairy and dairy substitute 413.8 5.5 -0.5 418.0 5.8 3.9

Fruit carbonates 556.0 7.4 2.8 541.0 7.5 1.3

Glucose stimulant drinks 923.9 12.3 7.3 860.0 11.9 9.9

Juice drinks 652.0 8.7 11.5 582.0 8.1 1.6

Lemonade 157.8 2.1 1.0 156.0 2.2 1.6

Non fruit carbonates 171.8 2.3 2.3 167.0 2.3 0.3

Plain water 572.9 7.7 13.1 507.0 7.0 4.0

Pure juice 1,170.7 15.6 -1.9 1,196.0 16.6 1.0