Gen Z’s Health-Conscious Beverage Choices: Why Coca-Cola Spiced Missed the Mark

Background

Targeting Gen Z's increasing preference for spicier flavors, The Coca-Cola Company launched Coca-Cola Spiced on February 19, 2024. However, production has already been discontinued less than a year after its release. This decision was critical to the company because the product was initially intended to become a permanent product line, like Coca-Cola Zero, rather than a limited-edition offering. Characterized by spicy and raspberry flavors, Coca-Cola Spiced was designed to cater to Gen Z’s taste for spicier food.

Figure 1. Coca-Cola Spiced

However, the primary target group, Gen Z, has responded coldly to Coca-Cola Spiced. In the school publication of United States- (US) based Clark University, the product was harshly criticized, saying it tasted more like cherry and shampoo than spicy. In addition, a marketing professor at Brigham Young University-Hawaii noted that the failure was due to the inability of Coca-Cola Spiced to address Gen Z's strong preference for healthy and authentic foods.

Why Coca-Cola Spiced Failed

By examining Google Trends, it becomes clear that the company's decision to launch Coca-Cola Spiced aligns with the 300% increase in interest in spicy food since October 2019. YouTube features numerous videos on the topic, many exceeding 100 million views, but these primarily focus on dishes like spicy noodles and spicy chicken.

While the interest in spicy food is clearly rising, the market rejection of Coca-Cola's Spiced may be attributed to two main reasons. First, Coca-Cola's Spiced may not have hit the sweet-spot of how consumers expect the 'spicy flavor' to be infused in beverages. Secondly, the market preference for spicy flavor is yet in its early stage of development for beverage products compared to other food products, therefore, taking a conservative stance in accepting new spicy flavored products. Considering the rising popularity of Dr.Pepper, which includes ginger flavor for a little bit of spiciness, we can infer that spiced beverages can be accepted by consumers with the right flavor and product development.

Figure 2. Youtube Keyword Trends: ‘Spicy Food’

Another reason for the failure of Coca-Cola Spiced seems to be its lack of connection to the concept of healthiness. According to a 2024 survey by brand tracking startup Tracksuit, consumers tend to perceive Coca-Cola as an unhealthy and sugary brand. This stands in contrast to the rising preference for healthier food options, especially since the COVID-19 pandemic. It is likely that Coca-Cola Spiced did not succeed due to its lack of alignment with health positioning, a key factor increasingly influencing consumer behavior.

Figure 3. Changes in eating habits post-COVID-19 Began in the U.S.

Rapidly changing US soft drink market

The US soft drink market is currently experiencing significant changes. Dr. Pepper has overtaken Pepsi, which previously held the second position in terms of market share. Meanwhile, after a period of growth, Coca-Cola’s market share has been gradually declining since the onset of COVID-19 in 2020. Moreover, the combined market share of the top five soft drink brands — Coca-Cola, Dr.Pepper, Pepsi, Sprite, and Diet Coke — has decreased. In 2000, these brands represented 55.4% of the market, but by 2023, their share had dropped to 51.7%, a decline of approximately 3.7%.

Figure 4. Market Share of the US Soft Drinks

The decline is expected to accelerate, especially with the emergence of brands like Poppi and Olipop, which are gaining popularity in the US as healthy beverages. Both of these brands focus on prebiotic soda, emphasizing their health benefits. In fact, these two brands have recently seen a surge in popularity, as evidenced by the sharp increase in search volumes for their keywords on Google Trends since 2023.

These trending beverages highlight the growing consumer preference for health-conscious products, a trend that is likely to continue in the future as more people shift towards healthier drink options.

Figure 5. Poppi prebiotic soda

Figure 6. Google Searching Trends about Poppi and Olipop

Conclusion

The failure of Coca-Cola Spiced can likely be attributed to several factors, with two major issues standing out: its weak connection to the healthy beverage trend and the fact that consumers seek spiced flavors, but mixed with other flavors properly. However, considering Coca-Cola’s overall market share, it’s difficult to conclude that this failure will have a significant impact on the company's performance.

The real challenge may come from strong competitors like Poppi and Olipop, which have positioned themselves as prebiotic soda and are gaining popularity by emphasizing their health benefits. These brands cater to the growing consumer demand for health-conscious products, a trend that has only intensified since COVID-19. It’s important for manufacturers to take note of this and ensure that new product development and marketing must emphasize the health aspect, as this keyword is likely to continue driving consumer decisions.