Diet Decline Endures

Volume loss continues to hurt overall CSD category

NEW YORK -- Have diet sodas--once the bright spot in the carbonated soft drink subcategory--lost their luster? According to a Wells Fargo Securities research report this week, the diet CSD category is on an accelerating downward spiral, "with overall dollar sales down 8.6% as aggressive pricing of -2.4% again failed to drive volumes."

diet soda

Year-to-date diet CSD volumes are down 6.2% vs. 2.4% for regular CSDs, according to the report. The statistics come from Nielsen's latest 4-week data ending Sept. 28, 2013, which shows total CSD sales down 3.9% for 12 weeks.

Ready-to-drink tea dollar sales were up 1.1%, led by strong performance from Pepsi. Energy drinks remained flat in the channel, with sales up 0.7%, led by Monster's solid 4.3% growth, according to the report. "Bottom line," summarized Wells Fargo analyst Bonnie Herzog, "CSDs remain under pressure, as diets continue to weigh heavily on the category."

This includes Dr Pepper's TEN platform, which continued to struggle with dollar sales down 8.0%, as virtually every brand posted worse sequential results for the second month in a row.

"As trends have worsened for the overall CSD category, we have become increasingly cautious about DPS in general," Herzog wrote, "and increasingly concerned about the inability of TEN to become a meaningful offset to otherwise declining CSD trends."

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