Coca-Cola unveiled a new sparkling waterline on Thursday, the first new brand in more than a decade.
The beverage giant launches AHA in early 2020.
The announcement comes as US noise consumption continues to decline, forcing Coke and its rival PepsiCo to invest more in marketing their old soft drink brands and thinking of healthier alternatives.
Flavored sparkling water or seltzer has become a popular alternative for consumers. In 2018, the sparkling water bottle grew 26% to 531 million gallons, according to data from Beverage Marketing. While the beverage is only a small fraction of the total market for bottled water, sparkling water is growing at a much faster rate than still water, which saw its volume increase only 4.2% last year.
LaCroix, owned by National Beverage, was once the leader in the category. But it is now losing market share as upstarts such as Spindrift and several established companies enter the arena. For example, Pepsi expects the Bubly brand, which launched in 201
Coke tries to position the new brand as different from its competitors. Two of AHA's eight flavors, Citrus + Green Tea and Black Cherry + Coffee, will contain added caffeine. But not too different: AHA will be sold in cans, not bottles.
AHA is not Coke's first entrance to sparkling water. The Atlanta-based company launched Dasani's sparkling waterline in 2014, to be replaced by AHA in stores. In 2015, Coke also launched a sparkling version of Smartwater. Coke will also introduce flavors to the non-parking Smartwater beverages in 2020. In 2017, it purchased Topo Chico, a sparkling mineral water brand with a cult following in Mexico and Texas.
In 2018, retail sales of Coke's North American sparkling water drinks sold jumped 27%, according to Nielsen. But the company's net income fell 10% to $ 31.9 billion that year.
Coca-Cola shares, which have a market capitalization of $ 226.2 billion, have gained more than 11% since the start of the year, while Pepsi's share, valued at nearly $ 188 billion, rose nearly 22% in the same period. The shares of LaCroix's parents, which have a market value of $ 2.1 billion, are 37% lower than today. The stock fell more than 5% during morning trading Thursday in Coke announcement.