The term “craft” is commonly linked to beer, but soda producers have also entered this niche. According to USA Today, citing Beverage Marketing data, craft soda sales reached $541 million at the wholesale level in 2016, a notable increase from $427.7 million five years prior. While the growth has not been rapid, it has been consistent, gaining traction each year. This trend offers a lifeline for carbonated soft drinks in general, which have seen a decline for 12 consecutive years and were overtaken by bottled water in 2016 as the leading beverage category in the U.S.
Gary Hemphill, managing director and COO of Beverage Marketing Corporation’s research division, remarked at the Beverage Forum in April that craft sodas are emerging as a legitimate choice for consumers, with new brands entering the market. However, he cautioned the audience that the overall market remains small and that the performance of these sodas has been inconsistent thus far. Many craft soda makers started in specialty stores or retailers that prioritize healthier or upscale offerings, but analysts now observe a shift toward mainstream acceptance.
In fact, the consumer appetite for craft soda brands—often flavored and sweetened with natural fruit—has begun to overshadow traditional sodas loaded with high sugar or synthetic alternatives. Numerous beverage “craftologists” are experimenting with unconventional ingredients like fruits, vegetables, and even calcium magnesium citrate with vitamin D3, aiming to create beverages that are less sweetened and generally healthier, albeit at a higher price point compared to conventional sodas. Nevertheless, research indicates that consumers are willing to pay a premium for these healthier craft options, suggesting a likely influx of such products in the market.
Despite the overall decline in the soda category, there remain lucrative opportunities for manufacturers within the craft segment, prompting major players like Coke and PepsiCo to get involved. Some beverage companies have launched sodas featuring natural ingredients and unique flavors, often available for a limited time, to pique the interest of consumers—particularly millennials, who prefer not to be seen with their parents’ sodas. In late 2014, Pepsi introduced a new brand called Caleb’s Kola, made with cane sugar, kola nuts, spices, and citrus. PepsiCo’s CEO, Indra Nooyi, noted at a conference that “there is actually a huge potential for craft cola,” emphasizing that while people still enjoy the cola taste, it has lost some of its appeal. She believes products like Caleb’s are reviving that cool factor. Since then, the soda maker has unveiled other specialty offerings, including 1893 with citrus cola and black currant cola, and most recently, a limited edition cinnamon-flavored cola called Pepsi Fire, aimed at the millennial demographic.