Carbonated soft drinks are the biggest pillar on which the industry of non-alcoholic beverages rests. Revenue in the Carbonated Soft Drinks segment in the US amounts to US$149.60bn in 2023 and is expected to grow annually by 1.52% (CAGR 2023-2027) . Characterised by multinational brand players, the USD 471 billion carbonated soft drink industry worldwide is dominated by 3 major players: The Coca-Cola Company, PepsiCo, and Keurig Dr Pepper .
In a previous article, we looked into the ‘cola war’ between the 2 soda giants, Coca-Cola and Pepsi. To extend the study scope, in this article, we investigated the presence of Dr Pepper and Pepsi in the food delivery market in the US. By leveraging Dashmote’s Data Analytics SaaS platform, we compared the penetration rates of the 2 brands on food delivery platforms within the US, and visualised the competition in a map, which compasses the winning brand in each state.
According to CNN, Coca-Cola controlled about 40% of the US retail market in 2022 by volume, followed by PepsiCo with about 29%, and Keurig Dr Pepper with roughly 25% . Although Keurig Dr Pepper ranks 3rd behind the 2 cola giants, it is faring better than its chief competitor in a number of ways. In fact, Keurig Dr Pepper’s revenue growth saw a sharp rise of more than 40% in the last three years. On the other hand, PepsiCo has seen only a 3.5% rise in revenue in the same period . While both companies have faced challenges in the wake of the COVID-19 pandemic, Keurig Dr Pepper has managed to outperform PepsiCo in terms of growth. Moreover, the company’s signature product, Dr Pepper, was the fastest-growing soft drink brand with a 40% brand value increase in 2021 . With the soda market continuing to hit the skids, Dr Pepper is hardly a scrappy underdog behind the 2 cola powerhouses, but a standout with a solid performance in the global soft drink market.
Before we dive into the results, it is important to note that Coca-Cola is the market leader in all states in terms of digital storefront listings, except for in Oklahoma, where Dr Pepper takes the lead with a minor advantage.
As for the current study, both Dr Pepper and Pepsi have strongholds in the food delivery market in the US. According to Dashmote’s data, Dr Pepper had a food delivery penetration rate of 31% among all the digital storefronts (DSFs) in the US in Q4 2022, which was more than Pepsi with a 26% penetration rate in the same period. By comparing the penetration rates of both brands per state, we could see that Dr Pepper dominates 35 states, whereas Pepsi controls 16. Overall, it is clear that Dr Pepper has a more advantageous position compared to Pepsi in the food delivery market in the US.
As shown in the graph above, Pepsi has a leading position clustered in the Northeast of the US. The brand dominates the states such as Michigan, Delaware, and Wisconsin - more than ⅓ of all DSFs sell a Pepsi product. Dr Pepper has been the market leader in the Southwest of America, with Arkansas (56%), Oklahoma (52%), and Louisiana (49%) having the highest penetration rates. Interestingly, although half of all the DSFs in Louisiana sell a Dr Pepper product, only 18% of them sell Pepsi, representing a dominant position of Dr Pepper in that state.
Neither Dr Pepper nor Pepsi has conquered the food delivery market in the District of Columbia and Hawaii yet. Only 11% of all the DSFs in the District of Columbia sell a Dr Pepper product, representing the lowest penetration rate of Dr Pepper in the US. For Pepsi, the penetration rates for both states are around 18%, which is also the lowest across the US. This implies more room for both brands to grow in terms of food delivery market penetration, as Coca-Cola’s DSFs base in these two states is more than double compared to Dr Pepper and Pepsi.
As for 2023, we expect both brands to show steady growth in the food delivery market in the US. Although products that support health and wellness are taking share away from carbonated soft drinks on a global scale, the soda giants like Coca-Cola, Pepsi, and Dr Pepper still have a unique advantage in the food and beverage market, as they have “deeply rooted connections with not only their most engaged fans but also with less frequent users” . Moreover, manufacturers have increasingly released healthier products by cutting the amount of soda-based calories to work on the same ambitious goal of fighting obesity in the country. With consumers who crave comfort and normalcy, we predict that soda brands tend to find a way to stabilise the headwind in the carbonated soft drink markets.
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