The term “craft” is commonly linked to beer, but soda makers are also joining this trend. According to USA Today, craft soda sales reached $541 million wholesale in 2016, up from $427.7 million five years earlier, based on data from Beverage Marketing. Although the growth has not been rapid, it has been consistent, gaining momentum each year. This trend has provided a breath of fresh air for carbonated soft drinks, which have experienced a decline for 12 consecutive years and were overtaken by bottled water in 2016 as the largest beverage category in the U.S.
At the Beverage Forum in April, Gary Hemphill, a managing director and chief operating officer with Beverage Marketing Corporation’s research unit, noted that craft sodas have emerged as a legitimate choice for consumers, with new brands entering the market. However, he cautioned that the overall base remains small and that the performance of these sodas has been varied thus far. Many craft brewers initially found their niche in specialty stores or retailers focusing on healthier or upscale products, but analysts suggest that craft sodas are now moving into the mainstream. Indeed, consumer interest in craft soda brands—often flavored and sweetened naturally with fruit—is beginning to overshadow traditional sodas that are high in sugar or artificial sweeteners.
Many beverage “craftologists” are experimenting with unconventional ingredients like fruits, vegetables, and even calcium carbonate and calcium citrate tablets to create drinks that are not only lower in sugar but also perceived as more naturally healthy. These products, however, tend to be pricier than regular sodas. Research indicates that consumers are willing to pay a premium for these healthier craft options, suggesting that more might emerge in the market.
Despite the overall decline in the soda category, there are still profitable opportunities for manufacturers within the craft sector, which is why major companies like Coke and PepsiCo are getting involved. Some beverage producers have introduced sodas featuring natural ingredients and unique flavors, often offered for a limited time to attract shoppers—particularly millennials who prefer not to be seen drinking their parents’ soft drinks.
In late 2014, Pepsi launched a new brand called Caleb’s Kola, crafted with cane sugar, kola nuts, spices, and citrus. PepsiCo’s CEO, Indra Nooyi, highlighted the significant potential for craft cola at a conference that year, stating that while people still enjoy the cola flavor, it had lost some of its appeal. She believes products like Caleb’s are helping to restore that “cool factor.” Since then, Pepsi has introduced other specialty sodas, including 1893 with citrus cola and black currant cola, as well as a limited edition cinnamon-flavored cola named Pepsi Fire, aimed specifically at millennials.