All Articles Food Soda sales slide as more sip water

Soda sales slide as more sip water

3 min read


During the recession, many belt-tightening restaurant patrons kept the check down by ordering water instead of pricier beverages. Today, efforts such as New York City’s ban on big soda have sought to raise awareness about high-calorie beverages and their role in obesity and to persuade people to cut back on sugary beverages.

But there’s evidence the ban might not be as necessary to fulfill that mission as Mayor Mike Bloomberg thought when he proposed it. The Wall Street Journal reports that soda sales decreased in the second half of last year, including the holidays, when soda sales typically peak. Demand for soda has declined 16% in the past decade, but until recent months, soft drink companies were able to raise prices enough to keep up revenue.

Companies including Coca-Cola, PepsiCo and Dr Pepper Snapple Group increased prices significantly to shore up sales amid higher commodity prices in 2011, according to the Journal. They tried the strategy last year but saw less success.

Soda consumption peaked in 1998, before habits started shifting, according to The Atlantic. Today, consumers drink 50% more bottled water and twice as many energy drinks as they did in 2001, Morningstar analyst Thomas Mullarkey says. Health concerns are driving the trend, along with another demographic factor.

“You’re seeing that the consumer is taking a healthier look and having more alternatives, such as tea and coconut water, but also, Americans have aged, and soft drinks are most popular among teenagers and 20-somethings,” Mullarkey said.

Soda-makers can’t do much about the aging population, but they are looking to get involved in the fight against obesity, as evidenced by a two-minute TV ad from Coca-Cola that touts the company’s 180 low- and no-calorie beverages and its role in reducing the average number of calories in a serving by 22%. Coke also puts the calorie count on the front of each container, to help consumers make the right choice, according to the ad, which emphasizes individual responsibility.

The ad isn’t without detractors, but initial consumer response has been positive, Marketing Daily reports. Ace Metrix rated it one of the top five most-effective ads to break in the past 90 days. To some in the ad industry, Coke’s “Coming Together” campaign is reminiscent of efforts by the spirits industry to counteract critics who tried to get alcohol advertising banned after Prohibition was repealed, according to Advertising Age.

“The beer industry urges consumers to drink responsibly, as too much alcohol isn’t healthy,” Beverage Digest Editor and Publisher John Sicher said. “Similarly, too many calories, with a sedentary lifestyle, isn’t healthy, and I think Coke is now starting to make that point in their ads, as has the industry.”

What are your patrons drinking? Tell us in the comments.