Soda Sales Go Flat
“There will always be soda, but I think the era of it being acceptable for kids to drink soda all day long is passing, slowly,” said Marion Nestle, a professor of nutrition at New York University.
The carbonated soft drinks (CSD) sector is a mature category in the beverages market. Over the last 20 years, sales of full-calorie soda in the United States have plummeted by more than 25 percent. Soda consumption, which rocketed from the 1960s through the 1990s, is now experiencing a serious and sustained decline. In recent years it has gone through multiple changes. Sugary sodas are under fire. Even many juice sales are slipping. Many of the brightest points are new brands and beverages that no one had heard of a few years ago, and this state of flux is expected to continue in the near future.
As a growing number of Americans announce that they are actively trying to reduce the number of daily calories consumed from drinks, the CSD industry has found itself out of favor as consumers seek beverages that they deem as healthier alternatives to soda. These shifts in consumer preferences to juices and flavored waters are prompting companies to make changes.
On the one hand, as consumers are increasingly looking to beverages to play new roles in their diets and health routines, soft drinks manufacturers are under higher pressure to adapt and create products that are fresh. Being eco-friendly is also a determining factor for whether a drink is deemed “healthy.” Many brands in the CSD industry have already removed preservatives and artificial ingredients; the next challenge is to leverage packaging to convey and deliver freshness without the chemicals that consumers view as undesirable.
Another approach taken by CSD manufactures to reignite interest in soft drinks and re-engage with consumers is the creation of unusual flavor profiles that require less sweetening. Spicy ingredients such as chili, ginger, cinnamon, and turmeric can appeal to experience-driven consumers looking for soft drinks that provide unusual or experimental drinking experiences. The salty-and-sweet trend has gained significant attention over recent years, with products such as Fanta’s salted watermelon offered in Japan.
The three largest soda manufacturers have entered a voluntary agreement that requires each company to reduce the total number of calories per person by 20 percent by 2025. They have also made investments in obesity research and have spoken about their commitment to offering healthy choices. With the Philadelphia school district forbidding the sale of sugary beverages in schools, and the city providing financial incentives for corner stores to highlight healthy foods, innovative and beneficial values associated with soft drink products are the keys to the success of the CSD industry.