Americans are becoming more health-conscious when making decisions about their daily beverages. That is bad news for the soda industry, which has seen its overall volumes lose 1.6 billion cases since 2004. In 2016, there were about 8.6 billion 192-ounce cases that were sold in the United States.
Despite the decline in overall volumes, however, the soda industry is still achieving growth in profits, with sales growing in 2016 by 2% to reach a global market value $80.6 billion. The explanation for this unique circumstance is an aggressive marketing campaign that promotes higher pricing and fewer discounts on large discount or wholesale packs of soda.
This allows the soda industry to target consumers who wish to purchase smaller cans as a “treat option” while reducing volumes sold through 2-liter bottles or 24-packs. When a 12-ounce can is reduced to a 7-ounce can, but the price remains the same, the reduction in volume creates a place where revenue gains can be experienced.
Important Soda Industry Statistics
#1. In 2016, the total volume of carbonated sodas dropped by 0.8%, which was less than the 1.2% decline that was experienced the year before or the 0.9% decline experienced in 2014. (Fortune)
#2. The steepest declines in carbonated soft drink volume were found with the brands of Diet Pepsi (9.2%) and Diet Coke (4.3%). Despite losing large market shares, both sodas ranked in the Top 10 most popular soft drinks sold in the United States. (Fortune)
#3. In 2016, the volume of Diet Mountain Dew sold in the United States was down only 0.1%. (Fortune)
#4. Although the soda industry has been experiencing volume declines, some caffeinated soft drinks have still been seeing success outside of diet branding. Dr. Pepper saw its volume increase by 1.3%. (Fortune)
#5. The sales of Sprite saw sharp gains in 2016, rising 3.7%, which made it one of the top-performing soft drinks of the year. (Fortune)
#6. Despite some of the gains for soda brands, the top beverages sold in 2016 came from the bottled water category. Aquafina led the way with a 10.9% gain, matched by Poland Spring (10.9%), which Dasani seeing strong sales as well at 5.3%. (Fortune)
#7. In the United States, sales of soft drinks have been somewhat steady, with total revenues of $45 billion. About half of all soda revenues are generated in the United States each year. (IBIS World)
#8. About 500 firms are currently producing soda in the United States, including craft soda makers. Together, these organizations are responsible for the direct employment of about 55,000 people. (IBIS World)
#9. In 2017, the sales of soft drinks in the Asia-Pacific region led in total volume, with over 202.3 billion liters sold. Latin America came in second, with 114 billion liters sold. North America, the most valuable market in terms of revenues, with actually fourth in total volume, with 90.5 billion liters sold. (Statista)
#10. The average person in the United States will consume over 40 gallons of soda over the course of a year. That equates to 650 8-ounce servings. In 2000, consumers were drinking over 50 gallons of soda per year, on average. (Statista)
#11. In the United States, cola-flavored beverages are the most popular. When all brands are combined, sales of cola account for 50.7% of total industry revenues. (Statista)
#12. The current market share of the Coca-Cola Company in the United States, when the sales of all brands are considered, is 42.5%. (Statista)
#13. The global brand value of the Coca-Cola Company is over $66 billion when all of their global brand revenues are combined. From this figure, the company is able to achieve a net operating revenue of $35.41 billion. (Statista)
#14. Between 2004-2012, children in the United States consumed 79 fewer calories per day from sugar-sweetened beverages, which represents a 4% decline in the total number of calories overall. As total calorie intake declined over this period, obesity rates among children have begun to level off. (The New York Times)
#15. From 2007-2013, the daily consumption rate of soda by teenagers fell by 24%, while consumption rates for the entire U.S. fell by just 20% over the same time period. (The New York Times)
#16. In a recent survey of preferred soda brands, over 54% of consumers said that they regularly purchase Coke products. (Statista)
#17. 1 out of 3 adults say that they consume soft drinks on a daily basis. 20% say that they have a soda more than 4 times per week. 10% say that they have a soda 2-4 times per week. 37% of consumers, however, say that they drink only one soda per week. (STM Journals)
#18. Although more than 60% of consumers say that they are trying to reduce the number of sodas they consume, 81% of adults say that they like soft drinks as a beverage. (STM Journals)
#19. 46% of consumers say that they will have a soda, even if they don’t have a specific reason to be drinking one at that moment. 29% say that they have a soda when they feel thirsty, while 24% say that sodas are a part of parties or celebrations only. (STM Journals)
#20. Internationally, 27% of people say that the brand of soda that they drink is treated as a status symbol within their society. (STM Journals)
#21. Coca-Cola has been working on reformulation strategies to reduce the sugar levels that are found in some of their sodas. In Europe, more than 200 reformulation efforts have led to 30% sugar reductions in their Fanta and Sprite brands. (Forbes)
#22. In the United States, 10.1% of consumers say that the purchase soda products every day. 25.8% of consumers say that they purchase soda a few times per week, while 32.2% say that they purchase soda a few times per month. (Statista)
#23. 15% of consumers in the United States say that they do not consider themselves a soda consumer. Another 7.1% of consumers say that they purchase soda less than once every 3 months. (Statista)
#24. Since 1988, the Coca-Cola company has expanded to over 550 brands. More than 20 of those brands have become worth more than $1 billion. (Food Dive)
#25. Adding new flavors to the Diet Coke brand, such as blood orange and mango, helped organic sales growth rebound by 5% in Q1 2018, with soda volume jumping by 4% in the quarter over figures from 2017. (Food Dive)
#26. Since 2007, when all soda sales have dropped by 13%, Dr. Pepper Snapple has posted an increase of 3% within the same space. In 2017, the company experienced a total rise of 1.1%. (Food Dive)
#27. In the United States, the average consumer is presented with an average of 10,000 marketing messages per day, which is why soda producers that produce memorable advertising tend to produce the best results. (Food Dive)
#28. For consumers between the ages of 15-25, more than 30% of the added sugars they receive in their diet each day comes from soda. For the 65+ age demographic, less than 10% of the added sugars they consume comes from soda. (Dubois, Griffith, and O’Connell)
#29. In 2017, for the first time in history, the sales of bottled water (42 gallons) was more than the sale of soda products in the United States. (Beverage Marketing Corporation)
#30. 48% of consumers say that they are drinking flavored water products in an effort to replace high-sugar drinks like soda to reduce calorie intake. (Mintel)
#31. To counter market losses, soda companies made large acquisitions in recent years. Vitamin Water was purchased for $4.1 billion, Bai was purchased for $1.75 billion, and a 17% stake in Monster was purchased for $2.15 billion by the top 3 brands in the soda industry. (Visual Capitalist)
Soda Industry Trends and Analysis
In most geographic sectors, the soda industry is already in its mature stage. Although developing companies are still providing growth opportunities, the challenge of the soda industry in the U.S. and other long-term markets is re-branding. Coca-Cola has seen success with its personalization branding, while others have looked toward health-conscious branding, limited-edition flavors, and the development of energy drinks.
With the success of higher pricing assumed to continue, the soda industry is forecast to grow at a rate of about 1.6% over the next 5-year period. That is just under the expected GDP growth of the United States over the same time period.
Look for soda producers to continue offering new products, such as seltzer water, juice-based drinks, and more personalization, to continue restoring relationships with previous customers. At the same time, watch for a marketing push to include sodas during different periods of the day, like a mid-day snack or a carbonated water beverage at breakfast.
Demand from abroad may help U.S. manufacturers stay afloat in the soda industry. Without more innovation, however, the declines experienced in recent years in volume will look to continue.