THE U.S. CARBONATED BEVERAGE MARKET:
HAS THE BUBBLE BURST? |
| While the long-term decline in the volume of carbonated soft drinks (CSDs) is a well-known and often lamented fact of beverage lore, there is a chance for improvement, according to Beverage Marketing's DrinkTell™ database. Also, the persistent decline in CSD volume does not signify that Americans are shunning carbonation altogether, as evidenced by the increasing consumption of sparkling bottled water and energy drinks. (We will refer to the amalgam of these three segments as carbonates). |
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According to DrinkTell™, CSD volume declined at a compounded annual rate of 1.6% between 2011 and 2017. However, adding in sparkling water and energy drinks, carbonates had a compounded annual decline of 0.9%. In 2011, CSDs had a 95.8% share of carbonates, which declined to 91.8% by 2017. From 2011 to 2017, sparkling water and energy drinks had compound annual growth rates (CAGRs) of 20.0% and 7.2%, respectively.
The next five years presents a more optimistic picture. The universe of carbonates is expected to enjoy a 0.9% CAGR to 2022. CSDs are expected to decline by 0.4% per annum on a compounded basis between 2017 and 2022: not a great performance in an absolute sense, yet noteworthy in the context of a CSD market that has fallen in volume by 20% from its peak in 2004. While energy drinks are expected to clock in with a 4.7% CAGR in the next five years, a perhaps inevitable declaration in its strong pace of the past 20 years, sparkling water is anticipated to grow volume at a torrid 20.6% CAGR to 2022. |
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The emergence of energy drinks, which are a kind of fortified CSD, as well as sparkling water, which perhaps can be viewed as unsweetened CSDs, has kept consumers from leaving the carbonated sphere in greater numbers. Doubtless energy drinks and sparkling water have stolen share from CSDs, and will likely continue to do so, but these beverages have also compelled CSD marketers to stay resilient. Examples include creating smaller package sizes to allow CSD to fulfill the role of a guilt-free indulgence, as well as the adoption of marketing cues that borrow from the energy drinks in the case of Mtn Dew Kickstart and from CSDs in the case of Sparkling ICE and the recently-revamped Fresca.
The foregoing represents just a few of the many data points and insights provided by Beverage Marketing Corporation's DrinkTell™ database. To schedule a demo, contact Charlene Harvey at 212-688-7640 ext. 1962 or via email at charvey@beveragemarketing.com. |
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