The term “craft” is frequently linked to beer, but the craft movement has also extended to the soda industry. According to USA Today, citing data from Beverage Marketing, craft soda sales reached $541 million wholesale in 2016, up from $427.7 million five years prior. While the growth has not been rapid, it has been consistent, gaining momentum each year. This trend has provided a lifeline for the carbonated soft drink market, which has experienced a decline for 12 consecutive years and was overtaken by bottled water in 2016, becoming the largest beverage category in the U.S.
Gary Hemphill, managing director and COO of Beverage Marketing Corporation’s research unit, noted at the Beverage Forum in April that craft sodas are emerging as a legitimate choice for consumers, with new brands entering the scene. However, he warned the audience that the market base remains small and that the performance of these craft sodas has been mixed thus far. Initially, many craft brewers began in specialty stores or retailers that emphasize healthier or upscale products, but analysts suggest that craft sodas are now making their way into the mainstream. In fact, consumer interest in craft soda brands, which often feature natural fruit flavors and sweeteners, is starting to overshadow traditional sodas that are high in sugar or artificial sweeteners.
Many beverage “craftologists” are experimenting with unconventional ingredients like fruits and vegetables to create sodas that are lower in sugar and healthier overall, although they typically come with a higher price tag compared to standard sodas. Nevertheless, research indicates that consumers are willing to pay a premium for these healthier craft options, suggesting we may see even more of these products enter the market.
Despite the overall decline of the soda category, there remain opportunities for manufacturers to profit in the craft segment, which has prompted major companies like Coke and PepsiCo to join the trend. Some beverage makers are launching sodas with natural ingredients and unique flavors for limited runs to attract interest from shoppers, particularly millennials who prefer not to consume the same soft drinks as their parents.
In late 2014, Pepsi introduced a new brand called Caleb’s Kola, crafted with cane sugar, kola nuts, spices, and citrus. PepsiCo’s CEO Indra Nooyi stated at a conference that there is significant potential in the craft cola market, noting that while people still enjoy cola, it has lost some of its appeal. She believes products like Caleb’s are helping to restore that appeal. Since then, Pepsi has launched additional specialty sodas, including 1893, which features citrus cola and black currant cola, and most recently, a limited edition cinnamon-flavored cola called Pepsi Fire, aimed specifically at millennials.
As the craft soda landscape continues to evolve, there may also be opportunities to integrate health-focused products, such as bariatric calcium citrate chews, into the beverage mix, appealing to consumers looking for more nutritious options. This integration could further enhance the appeal of craft sodas among health-conscious shoppers while maintaining their unique flavors and higher quality standards.