Ever notice how many people walking around are carrying either water bottles or cups of designer coffee from places like Starbuck's? Now these tastes are apparently being felt in the $68 billion U.S.
soft drink industry. New statistics show that for the first time in at least 20 years, sales of soft drinks declined in 2005. Even more surprising was that even diet drinks--once among the
industry's star players--lost some ground. Soda volume dropped 0.2 percent last year, according to Beverage Digest/Maxwell, a data service that has tracked soft-drink sales since 1985. The business
expanded at more than 3 percent in the late 1990s, but consumers have been steadily buying more bottled water, sports drinks, premium coffees and other noncarbonated beverages. Analysts also attribute
the downturn to a lack of soft-drink innovation and increasing concerns about obesity tied to sugared drinks. But diet drinks were also hit hard. Diet Coke volume was essentially flat after posting a
5 percent gain in 2004. Diet Pepsi volume dropped 1.9 percent following a nearly 7 percent increase in 2004. "I thought diet sodas could continue to grow and lift this category, but I think that's
questionable at this time," said John Sicher, editor and publisher of
Beverage Digest.
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