July beverage growth small despite discounts

Soft drink volumes climbed 1-2 percent in July despite heavy
discount promotions, according to Alton Stump, an analyst with Longbow

Coke and Pepsi continued 24-pack discount promotions from
June into July, but Stump said volumes failed to grow in convenience channels,
due in part to reduced traffic in convenience stores and a lack of new products
from major beverage companies.

Volumes climbed slightly at Wal-Mart locations, Stump said,
a total of 2-3 percent that buoyed the industry’s growth.

During the same period, non-carbonated drinks grew at a rate
of 20 percent over the previous year. Vitaminwater outperformed SoBe Lifewater,
Stump said, due to in-store spending and $1 per bottle promotions.

In bottled water, Pepsi’s Aquafina continued to outperform
Coke’s Dasani, Stump said, mainly on the strength of its in-store support and
discounts. Nestle aggressively priced its bottled water 24-packs, Stump said,
with the name-brand’s price actually falling below that of store brands at some

In tea, Pepsi’s Lipton outsold Coke’s Nestea on the strength
of its white and green tea extensions.

Overall, Stump said Pepsi and Coke’s market share, relative
to each other, held stable, though both gained shelf space at Wal-Mart as the
retail giant increased space for both while decreasing space for Cott’s store