US Consumers Drift Away from Sodas

14 March 2008

BEDFORD HILLS, New York: Rising commodity prices and consumer disinterest in sodas triggered a sharp fall in US soft-drink sales last year, according to industry data service Beverage Digest.

Volume fell 2.3% and was significantly worse than 0.6% and 0.2% dips in 2006 and 2005.

Beverage Digest publisher John Sicher says soda prices increased 5% last year and consumers turned their attention to other types of soft drinks such as enhanced waters and teas.

Beverages giants such as the Coca-Cola Company and PepsiCo will have to "redouble their efforts to find new beverages and new ways to replace the lost soda volume," says Sicher.

Coke's and Pepsi's soft-drink volumes fell 2.7% each, and both companies' share of the carbonated market slipped 0.1 percentage point - to 42.8%, and 31.1% respectively.

Among the top ten soda brands (by sales), only PepsiCo's Diet Mountain Dew and Cadbury Schweppes' Diet Dr Pepper posted volume growth. Coca-Cola Classic and Pepsi-Cola continued to slide, with Coke volume slipping 3% and Pepsi by 4.8%.

Consulting firm Beverage Marketing says the US market for non-alcoholic beverages, which includes soda, bottled water, sports drinks, fruit drinks, energy drinks and others, grew just 1.3% last year.

Data sourced from Wall Street Journal Online; additional content by WARC staff