Walmart’s Modern Soda category features beverages such as gut health superstars OLIPOP and Poppi, and stevia-sweetened Zevia.
It’s both a physical shelf in stores; as well as a section for shoppers online, and encompasses healthier sodas to traditional soda. That means low or no sugar, clean label, and/or functional attributes.
These kind of better-for-you beverages have, of course, been around (and growing) for years. What’s significant, however, is having the might of Walmart behind them and the recognition that Modern Soda is a clear category – and one with plenty of potential.
From reformulation to reformation: The soda revolution
Walmart has over 4,000 stores in the US and another 6,000 internationally, with more than 230 million customers a week.
“Walmart is, of course, a precedent-setter in terms of how categories are defined, and in this case is a first-mover in creating the Modern Soda set,” explains Amy Taylor, CEO of Zevia, a brand that has already been stocked in Walmart for years but will now see distribution expanded from 800 stores to more than 4,300 nationwide via its place on the Modern Soda shelf.
“Zevia is uniquely positioned as a great tasting, zero sugar, clean label product at a compelling price point...making us an ideal fit for this emerging category and a match for the Walmart shopper.”
The new shelf, says Taylor, is a triple win: it’s good news for consumers as they seek to eat and drink better; good news for Walmart on its mission to create affordable healthy options; and good news for brands that want to redefine how we think of soda.
And soda is a great category to target for several reasons. Traditional sodas are usually high in sugar and ‘empty calories’ (signifying a lack of nutritional value from the calories consumed), meaning it’s a clear target for reformulation and reformation.
Furthermore, soda is drunk by millions of American from across all demographics, meaning the potential impact is huge (in fact, Zevia estimates the average American family can cut their sugar consumption in half simply by switching from traditional soda to zero sugar Zevia).
And finally, it’s a category where there is now a strong and growing cohort of challenger brands which can offer a great alternative to traditional brands.
“Modern Soda satisfies a broad consumer base from Gen Z consumers who are naturally more engaged with better-for-you beverages through Millennials and Gen X households looking for zero-sugar, naturally sweetened alternatives to mainstream soda,” continued Taylor. “This meaningful milestone in the evolution of the broader carbonated soft drink category is a great opportunity for Zevia and Walmart both to accelerate their missions centered around healthier more affordable options.”
And what’s more, the new Modern Soda shelf makes those options much more visible. As Zevia points out, this new generation of soda has often struggled to work out where it fits best on the shelf - and consumers haven’t known where to find it either (a similar challenge faced by the alcohol-free category).
We still love soda, but...
Ben Goodwin founded OLIPOP in 2018 with a mission to create a healthier soda that supports digestive health. And it appears to be succeeding on its mission: the brand was featured in Time100’s Most Influential Companies 2024 for its efforts to revolutionize the soda category and is also featured on Walmart’s Modern Soda shelf.
OLIPOP’s secret has been to replicate a product consumers know and love – soda – but with positive health benefits.
“Given soda’s long history in the US, OLIPOP meets consumers where they are,” Goodwin explained. “With what we know about the nutritional profile of traditional soda, OLIPOP fills an important gap for consumers to enjoy this deeply personal and beloved drink, without the health consequences.
“OLIPOP combines nostalgic comfort with functional benefits that reflect broader societal health-conscious consumers, positioning the next wave of soda in a revolutionary way.”
And the company has found its fans come from everywhere.
“Given soda’s 98% household penetration, OLIPOP’s consumer base spans a wide range of demographics - it is truly meant for everyone,” said Goodwin.
“We’ve found that the product is beloved by people of all ages and has become a vehicle for encouraging sugar reduction, encouraging fiber intake and supporting digestive health through the form of a delicious soda.”
Taking on the big guys
Walmart’s Modern Soda shelves make a big statement. But it’s still just one section against traditional sugary sodas, which still make up the lion’s share of US soda sales. So how much potential do these better-for-you challenger brands have against the big guys?
Amy Taylor of Zevia points out that, while better-for-you beverages might be a small category at the moment, it’s riding the wave of the biggest consumer trends out there.
“Mintel projects that the carbonated soft drink category will continue to grow close to 30% over the next 3 years, and the better-for-you soda subset of that category is expected to grow 75% across that same time period,” she says.
“More consumers than ever before are seeking to avoid sugar and many of those are seeking clean-label products, especially younger ones. This shift to health and wellness is here to stay so while traditional soda makes up the majority of the category today, it stands to reason that better-for-you options are growing faster as they bring previous category rejectors to the soda aisle.
“These macro trends can have a big impact on health across the country, as well. As an example, a family can cut their sugar consumption in half by switching from traditional soda to zero sugar Zevia. As such, this Walmart expansion not only provides 5x distribution growth for Zevia at the country’s #1 retailer…but it has the potential to impact public health on a significant scale!
“Sugar reduction is the #1 health trend among US consumers and is expected to continue being a main focus in food and beverage choices as next-gen consumers enter key life stages and purchasing power years.”