The lemonade market - Italy

1.2 Global Market

The size of the lemonade market has been estimated at $**.** billion in ****, and total sales are expected to grow by *.* percent between **** and ****, reaching nearly $**.** billion.

Global lemonade market World, ****-****, in millions of dollars Source: ****

North America holds the largest market share at **.* percent in ****. The result is increased public and commercial funding for research and development in this region. Increased health awareness and understanding of the benefits of a healthy lifestyle will increase the demand for natural beverages such as lemonade in the region, driving market expansion. The use of lemonade as a fresh non-alcoholic beverage has increased over the years, particularly during the summer, and its demand is expected to grow further. More than ** percent of high schools in the United States have vending machines that provide carbonated beverages to kids, causing increased concern about the easy availability of these beverages, which is a major contributor to the increase in the lemonade business.

1.3 Italian Market

The production and sale of soft drinks in Italy employs **,*** Italians full-time in activities related to the production, processing and marketing of the sector's products. Those involved in the supply chain generate an added value of *.* billion euros and contribute  with *.* billion euros to the Italian state coffers in taxes and contributions[***].

Italians drink ** liters of soft drinks per year, a rather low per capita value that puts Italy in last place in the European Union's soft drink consumption ranking, along with Greece (***)[***].

Another important feature of the market is the strategic link with the territory, evident from the extensive use of Made in Italy supplies (***)[***].

1.4 Impact covid

The soft drinks sector has been hit hard by the Covid-** emergency, and the introduction of the Sugar Tax scheduled for January *, ****, which we will discuss in Section *, is likely to cause new and heavy effects on the market with obvious repercussions on the economic and employment values expressed by the entire supply chain.

As a consequence of the Covid-** emergency, Italian GDP contracted by * percent in **** compared to ****, as did household spending capacity. At the same time, food consumption decreased by -** percent compared to ****, a trend mainly related to closures and restrictions affecting HORECA.

the soft drinks market also suffered, closing with -**% between **** and ****. The reduction was mainly due to the aforementioned difficulties faced by the HORECA channel, which is essential to the health of the supply chain in this market, closing **** with -**%. On the other hand, sales in supermarkets withstood the crisis and maintained levels similar to the pre-pandemic world. Nevertheless, overall soft drink consumption has also suffered significantly due to the gradual decrease in tourist flows and the spread of remote study and work modes (***).

The graph below shows the aforementioned negative effects through the analysis of total soft drink consumption in Italy. As can ...

2.1 Demand trend: Lemonade as a source of health and quality

Lemonade is believed to have multiple health benefits, such as being rich in vitamin C. Natural lemonade can provide nutritional benefits without compromising taste. In recent years, people's preference for proper health and well-being has led to an increase in demand for lemonade.

Consumer demand for organic lemonade is rapidly increasing. Investments in lemonade are expected to bring high returns to beverage producers. These are huge opportunities for innovation, which should promote the development of the lemonade market.

One trend, therefore, that is increasingly easy to find in this type of market is the pursuit of quality. Italian lemons, which are used to produce lemonade, are of a very good quality and combined with the beneficial properties of lemons make Italian lemonade an absolutely desirable product for today's consumers.

2.2 Seasonality of demand

Google Trends allows us to analyze interest over time for the word "lemonade." The graph above represents the proportion of searches for a given keyword in a specific region and for a specific time period, compared to when the use of that keyword was highest (***). Thus, a value of ** means that the keyword was used less often in the relevant region, and a value of * means that there is insufficient data for this keyword.

This analysis shows that demand is relatively seasonal with a peak of interest in summer,particularly in July and August.

Interest over time for lemonades Italy, ****, in units Source: ****

2.3 Analysis of soft drink spending in Italy

A good indicator of demand for any product is average consumer spending on that product. In fact, excluding goods that satisfy essential needs, consumers who spend more on a certain product, in this case soft drinks, are more likely to spend more on it in the future as well and thus represent an essential component of its demand.

Istat provides data on the average monthly expenditure of Italian households on soft drinks, including mineral water and fruit and vegetable juices. The following graph shows the evolution of this expenditure in the period between **** and ****

Evolution of average monthly household spending on non-alcoholic beverages Italy, ****-****, in euros Source: ****

The graph shows some fluctuations over the years, with a general upward trend between the beginning and the end of the period. In fact, the average monthly beverage expenditure of Italian households grew by *.* percent between **** and **** (***).

Using this data provided by Istat, we can also construct a map to take a look at the differences between areas of Italy in terms of household spending on soft drinks.

As the map below shows, and strikingly so, average monthly spending on soft drinks is higher in the South and Islands than in the Central ...

2.4 Geographical distribution of demand

Also using Google Trends, we analyzed the interest in the word lemonade in the various Italian regions during the period **/*/**** - **/*/****. These analyses show that the region with the highest interest in lemonade is Campania. This is followed by Sardinia and Basilicata. In general, it can be seen that there is greater interest

Source: ****

3.1 The main market players

The most important players in the market for industrially produced lemonade in Italy are: San Pellegrino, Coca Cola, and Lemonsoda.

Sanpellegrino S.p.A. is an Italian company that produces mineral water and soft drinks, founded in **** in San Pellegrino Terme, where the production facilities are located. San Pellegrino has been making its lemonade with *** percent Italian lemons since ****.

Lemonsdoda 's story starts in Piedmont, ** years ago, with mineral water from Fonti di Crodo, and reaches all the way to Sicily, where it embraces the juiciest Sicilian citrus fruits that with a unique scent and flavor manage to bring out the best memories of an all-Italian history.it was the year **** when the SAGA company gave birth to the two recipes of Lemonsoda and Oransoda. Lemonsoda is held by the company Terme di Crodo S.r.l.

Coca-Cola has held the Lurisia brand since ****, a leader in the Italian lemonade market. Coca-Cola Italia also launched Fanta lemonade with no added sugar with ***% Syracuse Igp lemon juice (***), thus confirming its investment plan in Sicily.

Then supermarkets and hypermarkets are also important players in the sector, which in addition to being the main retailers and distributors of lemonades sometimes also produce lemonades under ...

3.2 Soft drink market structure

The Italian market, as represented by the Bevitalia ****-**** yearbook, is a market in which about ** companies operate, as we will see in the next section, but with a high concentration: the top * (***). The remaining ** percent is made up of smaller producers, which often stand out for their lively distribution in the territory and their ability to intercept a niche audience thanks to their quality and/or organic products, their respect for local traditions, their connection with the world of blending, and their clearly vintage and autarkic aesthetic[***].

The ** soft drink companies operating in Italy have strong relationships with both suppliers of goods and services, retailers, HORECA operators, intermediaries and wholesalers. An important role is played by small and medium-sized companies (***)[***].

Overall, the Italian soft drink market is composed of ** companies and *** establishments. As can be seen from the map below, producers are mainly present in the northwestern regions (***) [***].

Source: ****

3.3 Geographical distribution of lemon production

Lemon cultivation in Italy is concentrated in the South (***). Campania is the second largest Region, with about *,*** hectares representing just under *% of the national total

Source: ****

Along with the Italian product, lemons imported from Spain, Argentina, Turkey, South Africa, Uruguay are also sold in Italy. The market picture is also quite similar within the EU.in Italy * lemons have obtained PGI recognition :"Limone di Siracusa," "Limone Interdonato di Messina," "Limone Femminello del Gargano," "Limone Costa d'Amalfi," "Limone di Sorrento," and recently "Limone di Rocca Imperiale."

These are the areas of Italian PGI lemons:

Syracuse Lemon: Ha *,*** Interdonato lemon: Ha *** Sorrento Lemon: *** Ha Amalfi Lemon: *** Ha Femminello del Gargano lemon: *** Ha Rocca Imperiale lemon: Ha ***

Source: ****

4.1 Types of lemonade

There are several types of lemonade:

-Pink lemonade,sweeter (***) for coloring.

-Yellow lemonade,more tart ( Lemonade is made only with water, lemon and sugar, while pink lemonade uses them as a base but may also include red dye or something like strawberry, raspberry or cranberry juice.

In addition, the market can also be segmented according to the type of drink production into:

-Home production

-Industrial production

4.2 Price analysis

Below we provide a price analysis of some of the major lemonade brands in Italy.

To analyze the price of non-alcoholic beverages in Italy and its evolution over time, we must start by looking at the CPI, which measures average changes in the prices of goods and services purchased by households.

The graph below shows the evolution of that index. Although we see a fluctuating trend in the period between **** and ****, overall, beverage prices in Italy increased by *.* percentage points .

Consumer price index for soft drinks Italy, ****-****, in index (***) Source: ****

4.3 Supply trends

Syracuse IGP Lemon in new sugar-free Fanta Lemonade New production line already underway for the Sibeg plant, which bottles and distributes Coca Cola brand soft drinks.

In fact, the multinational company is launching Fanta Lemonade on the market without added sugar with *** percent PGI Syracuse lemon juice. Thus increases the amount of citrus fruits purchased, a third of oranges and lemons destined for processing: colors, scents and flavors of Sicilian quality citrus will thus arrive on the tables of millions of Italians.

Source: ****

Due to declining sales of carbonated beverages, companies in the soft drink sector are facing intense rivalry. Most of these companies are implementing new branding tactics, innovative marketing and advertising to gain a competitive advantage and a strong market presence. Investments in lemonade production by both new and established competitors are expected to significantly increase sales volumes in the coming years.

5.1 Regulation

Regarding the production of soft drinks, Presidential Decree No. *** of May **, **** lists the substances that may be used.

If a new substance other than those listed in Presidential Decree No. ***/**** is to be used in the production of soft drinks, Article **, third paragraph, of the aforementioned decree, as amended by Presidential Decree No. ***/**** , requires the company to notify the Ministry of Health and the autonomous region and province with territorial jurisdiction over the production plant, before starting production, in which the scientific documentation regarding the suitability of the new substance for human consumption must be reported.

The Ministry of Health, after verifying the actual suitability of the substances, which are the subject of the communication, for human consumption, including through consultation with relevant technical and scientific bodies, proceeds to its approval by publishing a notice in the Official Gazette and on the Ministry's web portal.

It should be noted that this communication procedure does not apply to ingredients that fall under the scope of Community Regulation No. ***/** (***) , in accordance with the provisions of Ministry of Health Circular No. * of April **, **** .

The Italian sugar tax, which is expected to come into effect from ****, establishes a one-time tariff of ** cents per liter for ...

6.1 Segmentation

• San Pellegrino
• San Benedetto
• Coca-Cola Italia
• Carrefour Italia
• Esselunga s.p.a
• Coop
• Lemonsoda