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Soft-Drink Sales Dip to 1996 Levels

Diet Coke Maintains No. 2 Slot While Fanta Passes Diet Dr Pepper

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Carbonated soft drinks reported their seventh straight year of declines in 2011.

The category saw volume slump 1%, taking it back to 1996 levels. Only Dr Pepper, Sprite, Diet Mtn Dew and Fanta are reporting growth, according to Beverage Digest.

Still tops, though it saw a 1% volume decline.
Still tops, though it saw a 1% volume decline. Credit: Bloomberg/Ian Waldie

Of the top 10 brands, Fanta reported the strongest growth, with volume up 3%, helping it pass Diet Dr Pepper. The brand has been a focus for Coca-Cola, which invested in a global campaign last year.

Diet Coke maintained its No. 2 slot, ahead of Pepsi, though the brands saw volume decline 4% and 4.8%, respectively. Coke maintained its top slot, with a 1% volume decline. Diet Pepsi saw the steepest drop in the top 10, with an 8.2% volume decline.

A PepsiCo spokesman said, "Pepsi and Diet Pepsi performed well in retail channels, where consumers have a choice." The Beverage Digest figures include fountain sales, an area where Coca-Cola dominates.

"Coke has about 70% of the U.S. fountain soft-drink business, and it adds significantly to their all-channel share compared to retail only," said John Sicher, editor and publisher of Beverage Digest.

Last year PepsiCo touted its plans to invest in the Pepsi trademark, as it increased ad spending across its beverage portfolio by 30%. It poured $60 million into its sponsorship and integration with "X Factor," introduced Diet Pepsi ads featuring "Modern Family" star Sofia Vergara and tweaked Coke with its "Summer Time is Pepsi Time " campaign.

While those efforts don't appear to be paying off yet, PepsiCo has committed to increase spending by more than $600 million on trademarks this year, including Pepsi. The brand is also expected to launch its first global campaign this spring. A PepsiCo spokeswoman declined to comment on news reports that singer Nicki Minaj will appear in the global campaign.

"Pepsi has now gotten behind their core soda brands," Mr. Sicher said. "But beginning to improve results will take at least a year or two, just as it took Coke a year or two in the middle part of the last decade."

Coke also took the top slot on Beverage Digest's top liquid-refreshment brands list, with Pepsi coming in at No. 2. Coca-Cola had three brands on the list, while PepsiCo counted four.

Beverage Marketing Corp. also reported 2011 figures today, which showed strong growth in the energy-drinks segment, with volume up 14.4%. Ready-to-drink coffee, sports beverages, ready-to-drink tea and bottled water also saw volume growth, while carbonated soft drinks, value-added water and fruit beverages reported volume declines.

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