t drink industry is projected to grow at the rate 4.5 percent per year (Branca, 1991). For diet drinks, however, growth is projected in the 11.5 percent range, while growth of only 2.5 percent is projected for the regular, sugar flavored colas, of which Coca Cola "Classic" is one. Internationally, growth projections for the industry are even stronger, with a 9.0 to 11.0 percent annual growth rate projected for the first half of the 1990s.
The per capita consumption of soft drinks in the United States more than doubled between 1965 and 1984 (Wise, 1985). In 1984, per capita consumption stood at just under 39 gallons per year in the United States. Per capita consumption growth continued through 1990, but at a slower rate, reaching a per capita consumption level of 48 gallons. In 1990, domestic soft drink prices began increasing for the first time since 1985, and volume growth slowed in response (Branca, 1991).
The demographics of the American population are changing significantly (Paxton, 1991). With respect to the softdrink industry, the most important changes are (1) the aging of the baby boom generation, which fueled the rapid growth of the industry in the 1960s and 1970s, and (2) the declining proportion of teenagers in the population, the age group the industry had hoped would fuel its growth in the 1980s and 1990s.
Slower growth in the domestic market is a reflection of changing demographics primarily a rapidly aging population (Konrad, 1990). As a consequence, competitors in the softdrink
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