Beyond the limited number of soft drinks with international appeal – Coca-Cola, Pepsi, Fanta, Sprite, etc. – there is a much larger number of local brands and flavours, many of which have a long tradition and/or a loyal customer base. Some of these niche soft drinks are potentially interesting for manufacturers and distributors as novel products in markets where they are not yet well known. Root beer is one such example – popular in North America and South-East Asia, but virtually unknown outside of these regions.
Contrary to what the name suggests, root beer – as it is manufactured today for the soft drink market – does not contain alcohol. The beverage has its origins in the 19th century, but grew significantly in popularity during the American Prohibition (the period from 1919 to 1933 during which the sale, manufacture and transport of alcoholic beverages was illegal). During these years, non-alcoholic or low-alcohol substitutes for beer became popular – including root beer, ginger beer and small beer. Nowadays, root beer is manufactured like other soft drinks, without the need for fermentation. As is the case for the production of other soft drinks, syrups containing concentrated and sweetened extracts are simply mixed with carbonated water.
The key to success, of course, is what flavours are contained in the extract. Historically, one of the key ingredients in root beer was the bark of the sassafras tree. Steam distillation of sassafras bark yields a fragrant essential oil consisting primarily of safrole, an alkenylbenzene with a characteristic “candy-store” aroma. Unfortunately, safrole was determined to be carcinogenic in rats at high doses, and was therefore restricted as a flavouring ingredient by the FDA in 1971. Safrole is also present in lower doses in a variety of spices, including cinnamon, nutmeg,
pepper and basil.
In root beer, sassafras bark extract has largely been replaced by artificial sassafras flavouring. All-natural varieties of root beer also include a complex blend of flavouring ingredients to re-create the sassafras aroma, including vanilla, sarsaparilla root, liquorice root, cherry tree bark, nutmeg, cinnamon, clove, molasses, anise, and wintergreen. Although normally caffeine-free, certain root beer brands are formulated to contain caffeine, including the major US brand Barq’s (sold by Coca-Cola). However, Barq’s also markets a caffeine-free variety in Utah and certain areas of Pennsylvania, out of consideration for the preferences of the Mormon and Amish populations in these two states.
An increasingly important reason for considering novel beverage products such as root beer is the stagnating sales of major soft drink brands, due in large part to the shrinking economy as many consumers cut back their spending on non-essential foods and beverages. As reported recently by the Beverage Marketing Corp., soft drink sales volume in the US fell 3% in 2008 – part of a drop in overall beverage sales of 2%, which represents the first decline since at least 1970.
Given the steadily declining sales of the major soft drink companies over the past several years – per capita consumption in the US is down 10.5% since 2000, and is now at levels not seen since 1992 – new products and marketing strategies are essential for achieving new growth in sales. Interestingly, despite the smaller volume of soft drinks sold in 2008, the dollar sales value grew by 1% to $72.7 billion, fuelled by increasing prices and larger sales of premium-priced beverages.
A novel root beer is one the new products recently mentioned by executives of Dr Pepper Snapple as part of their strategy to boost beverage sales. In this case, A&W – one of the major US root beer brands – has been formulated with real, aged vanilla. Improved low-sugar or diet versions of root beers and other soft drinks represent additional growth possibilities.
One area of particular interest is the development of all-natural diet sodas, such as those using stevia or rebaudiana as a natural sweetener. Another major root beer manufacturer, Reed’s, recently announced its move into stevia-sweetened soft drinks, with the introduction of a natural, calorie-free version of its premium Virgil’s Root Beer. The founding CEO of Reed’s, Christopher Reed, explained: “As mainstream beverage players look to enter the natural category with introductions of all-natural diet sodas, we seek to benefit from further growth in the natural beverage category and increasing acceptance of all-natural products in the
mainstream marketplace.”
However, as with any other diet soda, formulation is key to attracting and retaining customers. In a recent survey carried out by reporters for the Wall Street Journal, the stevia-sweetened root beer Zevia was criticised for tasting “watered-down”, at least in comparison with its sugar-sweetened competition. An alternative and quite successful strategy in the root beer arena has been the introduction of organic, all-natural brands such as Virgil’s and Maine Root.
There are an astonishing number of different root beer brands in the United States – at least 261 according to the leading website rootbeerbarrel.com. Major brands include A&W, Hires, IBC, Stewart’s (all four part of the Dr Pepper Snapple Group), Barq’s (Coca-Cola), Mug (Pepsi), Virgil’s (Reed’s). In a recent taste test by the New York Times, the root beer made by Sprecher’s (a brewery in Wisconsin with a number of regular beers as well) was voted as the best.
It seems that Americans are increasingly turning towards comfort foods in these uncertain economic times – with root beer being one of these. This trend is evidenced by the recently-announced “refreshment” of the soft drink line-up at McDonald’s. In partnership with Coca-Cola, McDonald’s is expanding the standard offering of fountain beverages to include Barq’s root beer, in addition to several new sodas such as Sprite Zero and new flavours of Fanta.
The US is not the only market for root beer. Interestingly enough, South-East Asia is also an important market for this tasty beverage, with the Philippines leading the way. At least in part because of its history as a former US colony, root beer is one of the uniquely American products which has achieved an impressive level of popularity in this nation. The major brand is Sarsi (a play on sarsaparilla), owned by San Miguel brewery, who are the distributor for Coca-Cola products in the Philippines.
So, how to introduce a novel soft drink like root beer to consumers who have never heard of it before? Ideally by introducing it to young consumers – preferably children. Root beer has a unique and candy-like sweet taste, which appeals to children. It is best enjoyed ice-cold, thereby dampening the sweetness somewhat and bringing out some its many other flavours. Most Americans have, as children, had root beer in frosted mugs (thick glasses with handles, kept in the freezer and therefore ice-cold before being filled with chilled root beer and served). This unique dining experience – ideally at a quick-service restaurant together with a hamburger and fries – is something that may well appeal to consumers around the world.
