NEW YORK, Nov. 14, 2016 /PRNewswire/ -- Over the past five years, falling per capita soft drink consumption significantly affected the performance of the Soda Production industry. Demand for both regular and diet carbonated soft drinks has declined as more consumers turn to healthier beverages to quench their thirst. IBISWorld estimates industry revenue will decline at an annualized rate of 0.9% to $42.8 billion over the five years to 2016.
To mitigate losses from lower consumption, major producers have introduced new soda products. Two of the leading manufacturers, The Coca-Cola Company and PepsiCo, launched new mid-calorie soda products that appeal to consumers who dislike the taste of diet soda but do not want to consume the calories in regular soda. Strong brand loyalty and new artisanal products allowed producers to keep prices high while input costs fell, raising average industry profit. However, according to IBISWorld Industry Analyst Chrystalleni Stivaros, "strong media coverage on the adverse effects of sugary beverages ultimately burst producers' bubble and caused revenue to decline."
Over the five years to 2021, the industry's soda segment will experience a difficult operating environment as government campaigns promoting healthier habits cause consumers to purchase less soda. Health concerns are also expected to curb demand for energy drinks, causing this product segment to grow more conservatively than during the previous period.
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