Call it soda or call it pop, but either way, there’s a new no. 2 soda in America, and it ain’t Pepsi.
After generations of competition, Dr Pepper has risen past Pepsi to become the second most popular pop in America, trailing the crimson wave of Coca-Cola. Recent data from Beverage Digest shows that although the brands have been competing for no. 2 for decades, Dr Pepper’s new ranking follows a slow but steady rise since almost the turn of the millennium. The 139-year-old brand has benefitted from huge marketing investments, novel flavors, and a distribution model that sees it on more soda fountains than any other soft drink.
Over the past 30 years, Coca-Cola has enjoyed a steady market share of about 20%, give or take a point or two year to year. That outpaces the next four competitors by over a 10% margin (Dr Pepper; Pepsi; Sprite; Diet Coke).
Perhaps it should come as no surprise that the 23 flavors of Dr Pepper – most notably cherry and vanilla, combined with other spices – should help it overtake Pepsi in 2024. In a new-look foodscape of swicy flavors during a time of shifting brand loyalties and a pair of generations in Z and the millennials who have demonstrated they’re up for, well, just about anything, the new ranking in the ongoing soda wars is less an anomaly of generations and perhaps more an indicator about where the national palate is heading.
“Dr Pepper has distinguished itself through effective marketing campaigns that emphasize its unique flavor and individuality,” said Andrew Dickow, managing director of Greenwich Capital Group and national leader of its food and beverage practice, to FI. “This strategy resonates particularly well with younger demographics seeking alternatives to traditional cola drinks.”
Dickow highlighted Dr Pepper’s 40% increase in brand value opposed to Pepsi’s “relatively stagnant performance.” He also noted that many consumers – most notably Gen Z and millennials – want “something different from the conventional cola flavor.”
According to the article, the American soft drink market is largely bisected into red and blue camps (no – not those ones) as consumers crack a Coke or pour a Pepsi. Each brand has its own distribution network and conducts an endless, ongoing, and ferocious battle for consumers’ taste buds during major events and scattered among the endless bars, restaurants, QSRs, and just about anywhere else soft drinks are sold.
Dr Pepper, however, is owned by Keurig Dr Pepper and maintains wary alliances with both competitors, meaning that wherever Coke or Pepsi are sold, there’s a good chance Dr Pepper has a backlit button as well.
“While Coca-Cola remains the market leader, the rise of Dr Pepper is a signal that consumer preferences are shifting,” Dickow added. “Coca-Cola will need to continue its focus on innovation, offering new flavors and healthier options to maintain its dominance.”
Andrew Springate is Keurig Dr Pepper’s chief marketing officer with over 20 years of experience who noted that the brand is growing fastest among Gen Z consumers, and its flavors appeal to those seeking indulgence and something a little left of center. When a TikTok-inspired recipe for Dirty Dr Pepper went viral earlier this year – that’s Dr Pepper, lime juice, coconut-flavored coffee creamer, and even liquor – the brand followed suit and introduced a nonalcoholic version called Dr Pepper Creamy Coconut.
Try as I might to find it, I’ve been unable to locate any of the Creamy Coconut (at least in diet form). But there may be a reason for that.
Coconuts for Dr Pepper
Dr Pepper Creamy Coconut was released little over a month ago on May 1, and since then, the internet (a.k.a. the culture) has been wildly divided on whether this fan-inspired LTO should be praised or panned. According to data from Pattern, an e-commerce accelerator, demand for the drink on Amazon has plummeted 21% since its release.
Still, demand for Dr Pepper – the OG Dr Pepper – has experienced a 26% boost since the debut, though curious consumers may look to TikTok for that as another Dr Pepper remix has gone viral – the Dr Pepper pickle drink, as ordered by mississippimemaw:
@mississippimemaw Pickle Dr Pepper #pickle #sonic #sonicdrivein #pickles #fyp #fastfood #mississippi ♬ original sound – Mississippi Memaw
A pickle-flavored Dr Pepper? It’s not outside the realm of possibility. It may even go well with another summer LTO – Spicy Dill Pickle Goldfish.
The Food Institute Podcast
Funding sources are drying up and inflation is making it harder and harder for higher-priced food brands to compete – what’s an early-stage food company to do? Dr. James Richardson, owner of Premium Growth Solutions and author of Ramping Your Brand, joined The Food Institute Podcast to discuss what types of food companies are succeeding under current industry dynamics.
