Growth in the healthy kids' beverage segment is outperforming the overall beverage category at Bashas' stores, according to Duane Proulx, vice president of grocery procurement for the Chandler, Ariz.-based chain.

The retailer's fast-moving kids' beverages include Kraft's Capri-Sun, which claims to be an excellent source of antioxidant vitamins C and E; Coca-Cola's Minute Maid; Nestlé's Juicy Juice; and Kool-Aid Koolburst. They're merchandised within the shelf-stable bottled juice section.

Bashas' promotes healthy kids' beverages six to eight times a year in its ads, as well as with temporary price reductions that are on rotation, by brand, each week.

“We always have a product on promotion,” noted Proulx.

The Capri Sun 10-pack is the most popular seller at Bashas'. The retailer sometimes promotes it with prices as aggressive as 3 for $5.

Sixty-four-ounce bottles of Juicy Juice 100% Juice also sell well at the retailer, as do Hi-C box drinks.

Pittsburgh-based Giant Eagle, which carries various beverages that appeal to children, is seeing strong category growth. One of the key drivers is price, noted spokesman Dan Donovan.

In-store placement at the retailer varies from location to location, but multi-serve and aseptic juices are often displayed side-by-side. Typically, these beverages take up 12- and 8-foot sections, respectively. Giant Eagle's best sellers are beverages marketed by Capri Sun and Juicy Juice.

Dayton, Ohio-based Health Foods Unlimited merchandises healthy kids' beverages both in its children's section and on the lower shelves of its beverage aisle.

Wateroos are faring well at the retailer, as are Hansen's Juice Slams, a 100% juice drink enriched with the equivalent of 17 daily essential vitamins and minerals for children. Crayons Fruit Juice Drinks are also among Health Foods Unlimited's best sellers.

The fortified, low-calorie, all-natural drinks include an ingredient called SugarGuard to help manage the way the body absorbs sugar. Crayons Juices were launched in March and are also distributed in Wild Oats Markets, Whole Foods and Sprouts Farmers Market stores.

“People are getting smarter, and they're not buying all those drinks with sugar and high-fructose corn syrup for their kids,” said Rhonda Miller, Health Foods Unlimited's co-owner. “They are looking for functional, healthy beverages.”

Among the new sugar-free entrants to the market are Crayola Color Coolerz, a naturally fruit-flavored purified water that is free of sugar, carbohydrates, caffeine and calories. The line has nationwide distribution in independent stores, as well as at many large retail chains such as Target Super Centers, Kroger and Wal-Mart. Wild Waters, a fortified and flavored line of water that claims to have 60% less sugar than the leading juice drinks, was launched last year. It's being distributed in many Northeast-based chains, including Big Y and Hannaford Bros.

To accommodate these and other brands, retailers like Roots Market are creating healthy kids' beverage departments.

“It's all coming together now,” said James Klink, grocery manager for the independently owned 15,000-square-foot health food store in Clarksville, Md. “Pretty soon we'll have enough products to create a 4-by-4 kids' corner up in the front near the heavily trafficked cookie and candy aisle. Every week you see more launches.”

Among the fastest-moving lines merchandised at Roots are Wateroos, Honest Kids Thirst Quenchers and Nestlé's Aquapod, a round-shaped, 11-ounce bottle of natural spring water.

Wateroos asks retailers to merchandise its water-flavored beverages with their other shelf-stable boxed juices, because that's where their primary target shoppers typically shop.

Aquapod is usually merchandised next to Nestlé's other case-packed waters in the main beverage aisle, but on promotion it is often cross-merchandised on endcaps with a variety of items targeting children. Wal-Mart created a “lunchbox” display for Aquapod during a recent promotion.

Honest Tea is asking retailers to put Honest Kids in their mainstream beverage section, following the logic that people are trending more and more to healthy drinks.

“Retailers should have these drinks adjacent to their traditional mainstream counterparts, but highlighted as healthy kids' beverages,” said Jon Haupton, a partner at the Barrington, Ill.-based Willard Bishop consulting firm. “That way, they can benefit from traffic and make as many people aware of the items as possible.”

The growth in the kids' juice category doesn't seem to be a passing fad, but a trend that can be expected to continue to grow in the years ahead. “I think you are going to see continued strong growth in reduced-sugar products for kids,” said Vierhile. “Schools are really clamping down now on the kinds of foods and beverages they will allow in school vending machines.”

The new launches are “addressing a gap in the market created by the decline of calorie-heavy carbonated soft drinks,” said Jeffrey Klineman, editor of Cambridge, Mass.-based BevNet.com.

With the exception of carbonated soft drinks, dollar sales of the top beverages grew across the channels.

BEVERAGE WATCH

CATEGORY	FOOD		DRUG		FDMX
	SALES	% CHANGE VS. YEAR AGO	SALES	% CHANGE VS. YEAR AGO	SALES	% CHANGE VS. YEAR AGO
CSDs	$12.0B	-3.4	$928.6M	7.8	$13.5B	-2.5
Milk	$10.8B	1.2	$431.0M	3.9	$11.5B	1.5
Beer	$8.3B	2.4	$894.8M	0.4	$9.2B	2.2
Wine	$5.3B	8.7	$333.1M	1.0	$5.8B	8.6
Bottled Water	$4.3B	10.6	$405.2M	11.1	$5.0B	11.2
RFG Juices/Drinks	$4.2B	4.1	$52.5M	7.4	$4.3B	4.5
Sales in food, drug and mass (for wine sales, food and drug only) for 52 weeks that ended July 15, 2007. Source: Information Resources Inc.