Soda sales are declining as consumers become wary of sugar.
And Coca-Cola has a multi-billion dollar response to the slump in the industry.
Last week, the soda company took a $US2.5 billion stake in Monster Energy.
“These days, caffeine doesn’t carry as much health stigma as the corn syrup that makes up most of Coke’s core products,” writes Kyle Stock at Bloomberg Businessweek.
While Monster Energy contains sugar, the amounts are significantly lower than a can of regular Coke.
Coca-Cola’s stake represents about 17% of the company, according to Stock.
Coke has been savvy about trends in the beverage market before.
The company was an early investor in bottled water (Dasani), flavored juices (Minute Maid), and health beverages (Vitamin Water).
Many in the industry expect that brands like Coke and Pepsi will continue moving away from traditional soda as Americans grow to prefer other beverages.
This chart by IBISWorld shows declining soda consumption in the U.S.
Coca-Cola’s strategy of marketing other beverages was reflected in a recent billboard in New York City.
Associated Press reporter Candice Choi tweeted a photo showing the marketing.
As soda consumption continues to decline, companies will have to get more creative to make profits.
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