Independent drinks company Global Brands said it was “bucking industry trends” as it reported a second consecutive year of on-trade growth for its flagship ready to drink (RTD) brand VK.
According to CGA data, on-trade value sales of VK have increased by 16% since 2016, while volumes have grown 12% during the same period. The company said VK was the biggest selling traditional RTD in the on-trade and the brand, which celebrates its 20th anniversary in 2019, generated £54.5m in revenue for venues across the UK in the past 12 months.
The brand now accounts for 32% of total RTD value sales throughout the on-trade and 33% of total volume sales. This represents a 4% increase in its share of value since 2017 and a 5% uplift in volume share for the same period.
Global Brands attributes VK’s growth to an “unwavering understanding and focus” of younger customers aged 18 – 22 years and despite the decline in RTD category sales (11% in value) in the on-trade, the company said it expected further VK growth in 2019.
Global Brands is seeing a trend of rising sales of VK in high street venues, which it believes signifies growth opportunities for the RTD category throughout the on-trade. Around two thirds of value sales of VK are driven through high street venues.
Global Brands, head of marketing, Jen Draper, said: “Consumers sit at the heart of what we do. We know younger consumers want choice and we’ve responded by continually investing in VK. We now offer seven different flavours and following a huge crowdsourcing competition, are bringing VK Watermelon to market.
“Keeping pace with consumer demands and responding with innovation drives sales and builds loyalty. Watermelon will help us to sustain growth and boost total VK value sales in the on-trade by about 8% during the next year.”
She added: “RTDs are much more than just a nightclub drink. They’ve got widespread appeal throughout the on-trade, striking a chord with consumers that appreciate their convenience. This, combined with category innovation, will drive sales of traditional RTDs and also see an emerging trend of new world RTDs in the on-trade.
“The latter, whether that’s more natural flavours and craft-esque type packaging, is still in its infancy in the on-trade, but I think we’ll see growth in these premium quality RTDs in bars and pubs similar to what we’re seeing in major supermarkets.”