Enjoying a cold Coca-Cola or Pepsi on a hot summer’s day is as American as apple pie or baseball.
But a changing marketplace and increased focus on the potential health risks of these sugary drinks has sent ripples through the soft drink industry in recent years.
Amazon’s Effect on Soft Drink Sales
More and more consumers are seeking to buy the products they use every day online, rather than in actual stores. In fact, a recent study stated that a third of all US consumers buy at least one product through Amazon or another online retailer at least once per week.
This is bad news for the soft drink industry because soda pop is dense and requires tight packaging to protect containers. But it’s also relatively low cost compared to other products weighing the same. So selling and shipping it to online customers can be cost-prohibitive.
Last week, PepsiCo Chief Executive Indra Nooyi said the company is looking at new, lighter packaging that would help its drinks travel better.
Governmental Interference
Another new hurdle facing the soft drink industry is soft drink taxes that take aim at the alleged health effects of sugary drinks.
A circuit court judge in Chicago earlier this month temporarily blocked a new penny per ounce county tax on all sweetened drinks set to go into effect July 1. Prior to the judge’s decision, the soft drink industry launched a full court press to attack the unpopular tax, including TV commercials and full-page newspaper ads aimed directly at consumers.
Suing Soda Makers
Then there are legal assaults on the soda industry, including a lawsuit filed last week by a Washington, D.C., pastor against Coca-Cola, claiming that the soda pop giant was deceiving customers about the health risks of sugar-sweetened beverages and ravaging poor, inner city communities with subsequent health risks such as diabetes, heart disease, and stroke.
Pastor William Lamar, of the Metropolitan African Methodist Episcopal Church, said he is tired of presiding over funerals of parishioners who died from health problems stemming from a steady diet of soft drinks.
Lamar claimed that soft drinks and other poor diet choices were killing more people in urban communities than street violence.
Next Steps for the Soda Industry
As consumers become more concerned about eating and drinking healthier and the beverage industry looks for better, cheaper, and faster ways to deliver its products to buyers, big soft drink producers like Coke and Pepsi will need to develop innovative ways to keep people wanting their products.