Consumers sip healthy alternatives to sugary drinks

Honest Tea's Honest Fizz line

The future of the beverage category is in low- and no-calorie drinks. Consumers have been forsaking traditional sugary beverages in favor of healthier alternatives. Statistics from the American Beverage Association show that the average calories per serving from beverages has dropped 23% since 1998, and the number of calories in the American diet from added sugars in soda has fallen 39% since 2000. Sales of traditional carbonated beverages also have been sliding.

About one-third of Coca-Cola's North American sales volume is now generated from low- and zero-calorie drinks, including Diet Coke and Coke Zero. Category leaders have been rolling out new lower-calorie versions of old favorites. Pepsi Next has 60% less sugar than Pepsi, and Mountain Dew Kickstart contains only 80 calories versus more than 100 for Mountain Dew. Dr Pepper Ten and 7UP Ten are Dr Pepper Snapple Group's 10-calorie versions of the classic brands.

Manufacturers are tempting consumers with new sparkling beverages. Honest Tea's Honest Fizz, sweetened with organic stevia and erythritol, has been a hit since its introduction in early 2013. The product, the company's first foray in the carbonated space, is being rolled out nationally. "We thought there was a need for a naturally-sweetened, zero-calorie carbonated beverage that tasted good, and the Honest Fizz has exceeded expectations," said Joanna Seiden, a spokeswoman for the company.

Hint goes even further with its unsweetened  flavored  sparkling water, Hint Fizz, introduced last year. Like the company's still waters, the beverages are unsweetened and flavored with natural fruit skins and oils. The company also is introducing new flavors and sizes this summer. "People don't like the aftertaste of sweeteners," said Kara Golden, Hint's CEO. "We believe that unsweetened products are where the category is headed."

Consumers also are looking to non-carbonated beverages for lower-calorie hydration, and manufacturers are happily serving up alternatives. Honest Tea is testing an Unsweetened Lemon Tea in the New York City market now, with national rollout planned for the fall. "We think there's room in the mainstream market for unsweetened products," Seiden said.

Even the water category is seeing action. Glaceau's Smartwater has created a niche with its focus on electrolytes, and Whole Foods is giving a lot of play to its private label electrolyte water introduced under its 365 brand. Nestlé Waters North America recently introduced a new brand of still water called Resource. In its ads for the new brand, Nestle is playing up the "100% naturally occurring electrolytes" in the still water, boasting that the beverage is "more than hydration, its total electrolytenment."

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