Nielsen Numbers: CSD Price Hikes Can’t Offset Volume Declines

wellsfargo200x200As consumption of carbonated soft drinks (CSD) in the United States continues its decline, soda giants have leaned on price hikes to offset their declines in volume. Time and again, however, these pricing initiatives have been unable to bring the category out of the red. Wells Fargo Securities’ latest report covering Nielsen xAOC (expanded all outlets combined) year-over-year sales data indicates that dollar sales of soda declined by 0.2 percent in the four-week period ending December 26, with a 2.3 percent increase in unit pricing failing unable to offset a 2.4 percent decrease in volume.

Dr Pepper Snapple Group (DPS) had the best performance among CSD giants, albeit less so than in prior periods. The company posted a bump in CSD sales of 0.7 percent, with 2 percent growth across its entire beverage portfolio coming from strong performances from DPS’ juices and teas. The Coca-Cola Company squeaked out a 0.1 percent bump in CSD sales via its flagship Coca-Cola brand, and a 1.9 percent increase for all its beverages by way of positive results from Coke’s waters and teas. Meanwhile, PepsiCo’s CSD sales were down 1.9 percent for the period but the company still managed to post a 2.1 percent increase in sales across all beverages and snacks.

The energy drink segment saw an overall 10.1 percent in sales coming from Rockstar (up 20.9 percent), PepsiCo’s Mountain Dew Kickstart (40.5 percent) and Red Bull (8.9 percent). Monster, which has experienced it share of growing pains as the company transitions over to the Coca-Cola distribution system saw 8.9 percent growth in dollar sales, resulting from a 5.6 percent bump in volume and 3.1 percent increase in pricing.

Other categories that continue to fare well amidst CSDs’ struggles include ready-to-drink coffee, sparkling flavored waters, and bottled water. The coffee category saw a 19.8 percent increase in sales, with The North American Coffee Partnership – Starbucks’ alliance with PepsiCo – surpassing the growth of the entire category with a 20.9 percent rise. Sparkling flavored water had impressive double-digit growth as well with a 16.6 percent increase. Bottled water rose 8.4 percent