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Big soda's pledge to reduce calories gets off to a weak start

Wednesday, November 23, 2016 - 10:17

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The US beverage industry's pledge to get customers to consume less sugar is off to a slow start.

[NEW YORK] The US beverage industry's pledge to get customers to consume less sugar is off to a slow start.

The intake of calories from beverages dropped 0.2 per cent in 2015, a small gain in the face of ambitious goals by Big Soda, a new report shows. Bottled-water sales increased during the period, but the impact on calorie-cutting was offset by a further decline for diet soda, according to the report by industry consultant Keybridge LLC released Tuesday.

Low- and no-calorie carbonated soda consumption fell 5.9 per cent. That suggests that the gains in water sales are most likely coming at the expense of diet soda, not sugary drinks.

Calorie declines need to accelerate for the soda companies to hit their goal, said Robert Wescott, president of Keybridge, in a press briefing. "Water is up; diet soda's down. Those are the two big themes."

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Under pressure from health advocates, public officials and consumers, Coca-Cola Co, PepsiCo Inc and Dr Pepper Snapple Group Inc have pledged to help cut the number of calories people drink per day.

Despite reformulating their products, creating new ones and introducing smaller package sizes, reductions have been slow.

The American Beverage Association, a trade group that represents the three companies, announced a pledge in 2014 to lessen the calories consumed per person by 20 per cent by 2025. That would take the daily per-person number to 159.2 calories from 199, according to Keybridge.

"It is a journey, and we're just a year and a half in," said Susan Neely, president of the American Beverage Association.

A visit to small shops and grocery stores in the Bedford-Stuyvesant neighborhood of Brooklyn, New York, shows that groundwork has been laid for the industry's campaign.

Bodega windows display signs saying, "Balance what you eat, drink and do." On-site advertising features low- and no-calorie brands rather than each company's flagship soda. Freestanding shelves house large bottles of branded waters and mini-cans of soda. Eye-level shelves - prime real estate in the soda aisle - are filled with smaller packages and less caloric drinks.

Bed-Stuy is one of five markets chosen as a focus for the campaign, an effort between the beverage association and the Alliance for a Healthier Generation. There will eventually be 10 places selected as focus regions because of their higher-than-average rates of obesity, which health advocates say is tied to consumption of sugary beverages.

While the soda companies are all working with the association, each has its own strategy, as evidenced by individual statements and actions taken over the past two months.

Plano, Texas-based Dr Pepper Snapple announced a US$1.7 billion acquisition of Bai Brands on Tuesday. Bai, which was already distributed by Dr Pepper Snapple, makes enhanced waters, carbonated flavoured water, coconut water, ready-to-drink teas and sugar-free colas. Coca-Cola said in October it will continue reformulating drinks, creating brands with fewer calories and emphasising smaller pack sizes.

Those measures will boost sales, the Atlanta-based company said.  Purchase, New York-based PepsiCo pledged in October to reduce its reliance on sugar, salt and saturated fat. At least two-thirds of the company's volume will have no more than 100 calories from added sugars per 12-ounce serving by 2025. On Tuesday, the company announced its acquisition of KeVita, which makes fermented probiotic beverages, as part of its push into more healthful products.

The companies are taking action to cope with changing consumer demands and governmental regulations. Voters approved soda taxes in four cities and one county two weeks ago, bringing the total number of local US soda taxes to seven.

Former New York City Mayor Michael Bloomberg gave more than US$18 million to campaigns in support of tax initiatives in Oakland and San Francisco, finance records show. Mr Bloomberg is the founder of Bloomberg LP, the parent of Bloomberg News.

"Driving change of this magnitude takes time," Howell Wechsler, chief executive officer of the Alliance for a Healthier Generation, said in a statement. "We are pleased that the beverage industry has begun to implement and learn from strategies that can reach the goal."

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