By Candy Sagon
Washington Post Staff Writer
Wednesday, June 28, 2006
Six months ago, Jordan Kerner's biggest challenge was getting WaddaJuice, his company's new fruit juice-and-water beverage for kids, into national supermarkets.
Then came the announcement in May that the country's three biggest soda makers, under pressure from anti-obesity groups, agreed to remove their sugary soft drinks from school vending machines. The effect on the juice industry "has been huge," says Kerner, whose company is based in Westport, Conn.
Juice beverage companies -- WaddaJuice included -- have been ramping up their marketing to schools, as well as to parents. WaddaJuice is being carried in stores in Connecticut, New Jersey and New York, but Kerner says his focus these days is on school districts looking to replace soda with healthier drinks that are lower in sugar and calories.
"The timing [of the soda pullout] couldn't have been better," he says.
Despite the publicity over the soda removal, many industry analysts don't think it will have much of a bottom-line impact on beverage giants Coca-Cola and PepsiCo. because both companies also sell a wide range of other drinks including juice, sports drinks and bottled water. The third soda manufacturer in the agreement is Cadbury Schweppes, maker of 7-Up and Hawaiian Punch.
But soda sales have definitely lost their fizz. A new survey by beverage industry analyst Bill Pecoriello with Morgan Stanley shows that carbonated drinks, even diet ones, have lost favor with teenagers.
According to the survey, 13- to 17-year-olds are drinking fewer sodas per capita than the overall population. Instead, teenagers are chugging down sports drinks, bottled teas and energy drinks.
Pecoriello predicts that yearly soft drink sales will decline 1.5 percent, more than twice the rate of decline last year.
U.S. soda sales in supermarkets and retail centers (excluding Wal-Mart) already have slipped 0.9 percent, to $13.3 billion, in the 52-week period ending May 21, according to the market research firm Information Research Inc.
In contrast, sales of refrigerated juices for the same period is up 0.1 percent, to $3.9 billion.
Carol Freysinger, executive director of the Juice Products Association, a juice and beverage company trade group, says there has been "a cumulative effect from the wellness policies that states and school districts are adopting."
The group, which includes both Coca-Cola Co. (which owns Minute Maid) and PepsiCo. Inc. (Tropicana), recently launched a Web site ( http://www.fruitjuicefacts.org/ ) that focuses on the health effects of pure fruit juice.
But the push to position juice as the healthy alternative to soft drinks is not quite so simple, nutrition experts say.
"Parents have to look carefully at the label and see what percentage of fruit juice a drink really contains," says Gail Rampersaud, a University of Florida dietitian.
Products labeled a juice "drink," "-ade" or "punch" often contain only 5 percent juice or less. "They're basically just high-fructose corn syrup and water," Rampersaud says. The only thing that makes these fruity drinks slightly better than soda, she notes, is that they're often fortified with vitamin C.
Adding vitamin C is "just a marketing ploy," contends Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest, a consumer advocate group. "It's not nutritionally necessary. Drink makers put it in for the halo effect -- to make their product seem nutritious when it's really no better than soda."
Wootan cites, in particular, beverages such as Sunny Delight, Capri Sun, Tropicana Twisters, Kool-Aid Jammers and Hi-C as the nutritional equivalent of "soda without the bubbles" because of the tiny amount of actual juice they contain.
In a recent survey, the Center for Science in the Public Interest found that while 22 states restrict the sale of sugary soft drinks in schools for some grade levels for at least some part of the day, only 12 regulate the sale of fruit drinks. Wootan would like to see school districts offer bottled water and drinks that contain no less than 50 percent fruit juice and no added sweeteners.
Her personal preference for a soda alternative in schools is a drink made from seltzer water combined with a little fruit juice "so it's bubbly and a little sweet, but still healthy."
Juice mixed with water is what Kerner gave his son when he was 2 -- and it's what gave him the idea for a new drink line for kids. "My pediatrician told me that pure juice was too sugary for him, but I could water it down," he says. "That's how I came up with WaddaJuice."