Rethinking beverages, with new urgency

March 14, 2013

The remaking of the beverage aisle is underway. It is looking more transparent, more sustainable, and less sweet.

Beverage giants Coca-Cola, Pepsico and Dr Pepper Snapple are more focused than ever on rising domestic consumer demand for healthier drinks such as tea, coffee, water, juice and muscle recovery shakes.   

The nation’s broader beverage palate also has some carbonated drink fans seeking greater control of the flavors and ingredients they consume, and wanting to help the environment.  For them, SodaStream gives choice of more than 100 flavors and a way to keep bottles out of landfills.  The brand is also integrating into lifestyles, with an arrangement to supply sparkling water dispensers for the doors of some new Samsung refrigerators.  

Clearly, consumers drink differently today.  Boomers who grew up on soda are cutting back on calorie-dense sugary drinks to help stay leaner and active.  Millennials never had the soda habit to the same degree—they grew up toting bottled waters to school.

So, while soda makers capture growth abroad and seek an artificial sweetener that everyone can agree on, U.S. sales of carbonated soft drinks continue to decline.  CSD dollar sales in the 52 weeks ended Jan. 19, 2013, were $21.37 billion, 0.4% less than $21.45 billion a year earlier in U.S. food-drug-mass outlets (prepackaged UPC-coded products only), reports Nielsen.  Yet price hikes buoyed the latest figures.  Unit sales were down 5.7% in this latest 52-week period.

Moreover, CSD is under attack as the nation tries to stem challenges of obesity and diabetes.  New York City Mayor Michael Bloomberg is trying to cap the size of sugary drinks sold by restaurants, theaters and food vendors at 16 ounces; the proposed ban on larger drinks would not extend to supermarkets and convenience stores.  A judge has said no, but the city plans to appeal the decision.    

Pushing the FDA towards decisive action, the Center for Science in the Public Interest executive director Michael F. Jacobson issued a recent statement:  “Like a slow-acting but ruthlessly efficient bioweapon, sugar drinks cause obesity, diabetes and heart disease.  The FDA should require the beverage industry to re-engineer their sugary products over several years, making them safer for people to consume, and less conducive to disease.”

An upcoming conference, Healthy Beverage Expo, will address the nation’s shift towards healthier beverage options when it convenes June 7-9 in Las Vegas. A white paper prepared in advance of this conference, 7 Key Changes the Beverage Industry Must Accept:  The Future of Beverages, explores issues such as:  consumers’ search for healthier choices; touch-sensitive packaging that will convey full descriptions of ingredients and health claims; demand for less-sweet beverages; distribution changes; the rise of at-home water filtration systems; and more sustainable packaging.