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“Diet” soda disappears from store shelves

“Zero sugar” has replaced the “diet” for many calorie-free soft drinks. Canada Dry and Schweppe’s ginger beer, 7Up, A&W and Sunkist, made by Keurig Dr Pepper, now label their diet drinks as “zero sugar”. (An exception is the namesake Dr Pepper brand, which still comes in “diet” packaging in addition to another zero sugar version.)

The reason for the overhaul: The word “diet” has gone out of fashion – especially for Millennials and Gen Zs.

“No Gen Z wants to be on a diet these days,” he said, adding that the company “will continue to innovate and support that business.”

Diet 7UP is dead.  Long live 7UP Zero Sugar.

But disgust for the word diet does not signal an aversion to low-calorie drinks. The diet soda segment, which includes diet and zero-calorie-labeled drinks, has grown since it first became popular in the 1960s. By 2020, the US diet market for carbonated soft drinks in the United States reached $ 11.2 billion, according to Mintel, a market research company.

The segment is still far smaller than the market for regular carbonated soft drinks, which was 28.2 billion dollars in 2020, but it is growing much faster. Sales of diet soft drinks are up approx. 19.5% from 2018, compared to only 8.4% for regular soft drinks in the same period, which makes it an attractive segment for soft drink producers seeking growth.

Developing attitudes to dieting as a concept mean that soda producers must place an emphasis on diet brand when continuing with zero-sugar offerings – even when, as in the case of the brands owned by Keurig Dr Pepper, they sell the exact same drink.

The tactic can help soda producers bring more consumers, especially younger ones, into the group. The industry needs these customers if it wants to grow the soda market.

Diet soda became popular in the 1960s.

The birth of diet cola

Diet drinks first became popular in the 1960s.

Diet Rite, a calorie-free drink from soda maker Royal Crown Cola, was launched in 1958 “as an alternative for diabetics and other consumers who needed to limit their sugar intake,” wrote Emily Contois, author of “Diners, Dudes, and Dieters: How Gender and Power Collide in Food Media and Culture, “in a 2020 piece for Jezebel.

“It was first stored among medicines instead of soft drinks, but the focus soon shifted to the growing number of weight loss dieters across the country,” she wrote. Diet Rite was a hit, prompting Coca-Cola to introduce Tab in 1963, and Pepsi began selling Diet Pepsi a year later.

The segment received steam in the following years. Coca-Cola wanted to expand beyond Tab, launching Diet Coke in 1982.

At the time, Coca-Cola faced many of the same challenges it faces today: It needed to revitalize the Coca-Cola brand, and thought it might help to add a cola-branded diet.

Cola changes the recipe for a popular drink.  A lot can go wrong
A company blog post describing the launch of Diet Coke noted that “cola accounted for 60% of all soda sales in the United States at the time, but the diets grew three times faster than the rest of the category. Diet Coke was seen as the right product at the right time.”

The company broke with what the product should be called. It considered using the term “sugar-free” instead of diet, but “many saw it as nonsense on Coca-Cola’s main ingredient,” according to the post. In the end, the company went with the “diet” because it “was the simplest articulation of the promise of the brand.”

But a few decades later, Coca-Cola returned to the idea of ​​a sugar-free branded product. This time it wanted to attract the demographics that seemed to avoid the company’s diet drinks: younger consumers and men.

Zero hits the stage

In 2005, Coca-Cola introduced Coke Zero in the United States. The Baltimore Sun explained at the time that Zero’s “marketing is aimed at a demographic, like young people and the most macho men, who see a stigma attached to the word diet.”

Other companies also wanted a more neutral way of advertising sugar-free products.

Eliminating the word “diet” creates a “gender-free way to talk about the same subject,” said Jim Watson, a senior beverage analyst at Rabobank, who told CNN Business that “the diet was definitely taken over as something for women.”

But the advent of zero sugar drinks was not just about gender: it marked a turning point for the general popularity of diet drinks. Alex Beckett, global food and beverage analyst at Mintel, said the word diet “began to fall out of fashion … with the rise of zero.”

Coke Zero Sugar got a makeover this year, with new boxes and an updated recipe.

Billing a drink that is free of calories and sugar is also about addressing changing ideas about health, and highlighting the absence of sugar from the drink as a positive trait in itself.

“Although the diet term may be associated with strict regimens or deprivation, the term ‘zero’ has fewer negative connotations, which simply corresponds to a cleaner profile,” according to an April Mintel report.

For Keurig, the shift seems to be working. Recent zero-sugar launches alone were responsible for one percentage point of market share for the company, according to Derek Hopkins, president of cold drinks at Nice Dr Pepper (KDP), which reported on the company’s finances during the company’s investor day in October.
Cola (QUEUE) has also seen success with the Zero offering, which was renamed Coca-Cola Zero Sugar in 2017 and received a new update this year. “Coca-Cola Zero Sugar’s new recipe has rolled out in more than 50 countries and has accelerated growth over the past three months,” said Coke CEO James Quincey during an analyst interview in October.

The new recipe hit shelves in the US this summer, and since then “we have seen that 23% of today’s Coke Zero Sugar consumers are new,” said Alex Ebanks, a spokesman for the company, adding that Coca-Cola will continue to invest in the product next year and beyond.

The competition is heating up

While big brands are sharpening their focus on their zero-sugar offerings, they are facing competition from other categories and emerging with new ideas.

A major competitor, according to Mintels Beckett, is carbonated water.

“A lot of people go over … from carbonated sodas to sparkling water,” he said, because these drinks often have no sweeteners, no calories and “have a healthier image.”

PepsiCo (PEP) and Coca-Cola has offered its own sparkling water to join the trend. Coca-Cola owns Topo Chico and has a series of caffeinated sparkling water called Aha, while PepsiCo sells Bubly.

In addition to sparkling water, competitors enter the room with fresh spins on soda. For example: Soda that promotes intestinal health.

Olipop, a startup that says it makes “a new type of soda,” sells recurring flavors such as classic root beer, vintage cola and others. The sodas, which range from about 35-50 calories each, are made with a blend of ingredients such as Jerusalem artichoke and manioc root which the company says supports digestive health. Poppi, which also sells traditional soda flavors in addition to fruit flavors, comes with a similar claim, with a “for a healthy gut” label on the front of colorful boxes.

“Consumers are voting for our wallets, and sugar is something people definitely want less of in our lives,” said Danny Stepper, CEO of LA Libations, an incubator for beverage companies. “It opens the door to many opportunities and categories,” he said. “Consumers want new things, so it opens the door to new ideas.”

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