Sunday, May 20, 2012

The End of Soda? - The Atlantic

MAY 18 2012, 3:40 PM ET

Sales of soft drinks are falling in the United States. But don't start writing the industry's obituary.

If the New York Times is to be believed, the soft drink business is facing a moment of truth. This week, the newspaper reported that beverage industry titans Coca Cola and PepsiCo have increasingly been forced to rely on the sales of alternative products like bottled water, tea, and sports drinks to make up for the flagging sales of their sweet and fizzy standbys. Since 1998, American per-capita consumption has dropped 16 percent.
"What began as a slow decline accelerated in the middle of the last decade and now threatens some of the best-known brands in the business," the paper reported.
Could it be? Are we truly witnessing the first stages of soda's demise, the early signs of decay in America's 200-year love affair with soft-drinks? And if so, does that mean trouble for drink makers? 
There are two major reasons to skeptical about the end of soda. First, soda sales haven't fallen that drastically. Second, even if U.S. consumers are shying away from soft drinks, the global market is still looking pretty sweet.  
To get some additional statistics, I called up John Sicher, the publisher of Beverage Digest who provided the Times with their data. He told me that U.S. soda consumption is indeed falling overall, not just per person. Since 2006, Sicher said, the total volume of carbonated soft drink sales has fallen about 11 percent, from 10.2 billion cases to 9.3 billion. Some of that drop is the result of changing consumer preferences. Parts of the population are becoming more health conscious. Tastes are changing. We want energy drinks, Gatorade, organic tea, and artificially flavored, 0 calorie, vitamin-enhanced "water." 

Read on... The End of Soda? - The Atlantic

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