It's no longer a matter of who's winning—it's about who's losing the least
It’s a question that’s been around about as long as the oldest human living on Earth: Coke or Pepsi?
Lately, the answer is “neither.”
Health-conscious consumers have been turning away from sugar-sweetened beverages, and that’s causing headaches for the country’s top soda sellers. Coca-Cola reported a 55% drop in quarterly profit Tuesday, while PepsiCo investors are also bracing for less than stellar news when that company posts earnings Wednesday. Coke actually saw its first rise in North American sales in four quarters, but that was thanks to price hikes rather than increased demand.
All told, nobody’s really winning the soda wars. Soda sales have been in decline since 2005, falling 3% in 2013 alone, according to market research publication Beverage-Digest. Coke and Pepsi have both posted negative yearly sales changes for the last 11 years, though Coke has better weathered the storm:
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If you think soda’s salvation lies in the word “Diet,” think again. Health experts have for years rejected the myth that “diet” soda is a healthy alternative. Now, consumers are distancing themselves not just from sugar-sweetened drinks, but also their artificially-sweetened cousins:
One corner of the beverage industry that’s actually winning? Energy drinks. Compared to the contracting Coca-Cola and PepsiCo businesses, energy drink companies like Monster and Red Bull have consistently experienced positive yearly growth:
Both Coca-Cola and PepsiCo have gotten in on the energy drink game: Coca-Cola bought a stake in Monster last year, while PepsiCo has shunned acquisitions, instead focusing on its own Mountain Dew Kickstart. Those moves have turned energy drinks into the latest battle ground between these perennial beverage titans.
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