The Death of Soda

Visual Capitalist  |

The Death of Soda: 11 Slides on Why the Industry Has Gone Flat

When you think of the iconic American brands of the 20th century, names like Coca-Cola and Pepsi have to rank pretty highly on any list.

Both fizzy beverages became household names nearly 100 years ago and even butted heads in one of the most infamous and long-lasting marketing battles of all-time. In the process, both brands have sold billions of bottles of product, creating powerful foundations for their sprawling beverage empires of today.

While the soda industry has seen incredible global growth over the years, it seems all good things must come to an end.

Today’s slides on The Death of Soda come to us from Dynamic Wealth Research, and they show how new consumer preferences have left the soda industry flat, forcing its titans to scramble to recapture market share. We also see what is replacing sugary beverages, and the market potential behind some of these new segments.

1. U.S. Soda Consumption is at a 30-Year Low

U.S. Soda Consumption is at a 30-year low

Soda consumption in the U.S. has dropped from 50 gallons to 37.5 gallons per capita between 2000 and 2017. It’s now at a 30-year low.

2. Bottled Water is Taking Over

Bottled water is taking over

For the first time in U.S. history, more bottled water is being sold than soda per person. It’s a fundamental shift in consumer habits – if you look at the graph, you can see that as recent as the mid-2000s, people drank twice as much soda per capita.

3. Calorie Consumption is Changing

Calorie consumption

Most of us are eating differently these days, but these changes are extremely evident when looking at calorie consumption of children. As you can see, sugar sweetened drinks are falling off the map in a big way.

4. People are Drinking Water, Instead

Why people are drinking water

What’s getting substituted for sugar sweetened drinks?

Water is a big one: it’s healthy, convenient, and natural – all things that appeal to today’s health-conscious consumers.

5. The Water Market is Maturing

Water market maturation

As the market matures, different segments an niches are being carved out. For example, water can be plain, sparkling, enhanced, or premium.

6. Consumer Want More Than Plain Water

Consumer water preferences

Plain water can also be poured from a tap, so it’s not surprising that consumers want to see their water enhanced in some way. Many are also sensitive to price.

7. The Bottled Water Market is Worth Billions

Bottled water market size

In 2017, the global bottled water market was worth $199 billion.

8. Soda Brands are Scrambling

Soda brands scrambling to take action

Soda brands pushed their diet products, but this backfired as consumers became concerned about the impact of artificial sweeteners on their diets.

9. Coca-Cola is Diversifying its Business

Coca-Cola diversifying business

In response to the death of soda, companies like Coca-Cola are adding brands to their portfolio that can compete in less traditional segments. Examples of these brands include everything from energy drinks to coconut water.

10. Big Brands are Buying Up Smaller Companies

M&A in the beverage sector

Big fish like Coca-Cola and PepsiCo are gobbling up innovative beverage startups in order to compete in these new and emerging segments.

11. The Trend is Your Friend

Future trends

As the beverage industry continues to get turned upside down by the death of soda, it creates opportunities for savvy investors. The global bottled water market will reach an impressive $307 billion by 2021, and new segments will continue to emerge as consumers become even more health-conscious.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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