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Soda Case Study Analysis

Decent Essays
For many years, nutrition activists have attempted to reduce soda consumption by taxing sugary soft drinks, but have been continuously shot down by many U.S. states. Fortunately for these activists, soft drink sales have been declining since 1998 with sales down by nearly 30 percent from its peak. Decreased soda consumption can be attributed to the fact that Americans are simply consuming fewer calories. Many health researchers believe that this healthier lifestyle is due to increased knowledge of obesity and a possible trend that obesity rates are leveling off and declining instead of increasing. This change in consumer’s trends for soda has created a massive challenge for beverage makers as they scramble to invent new products, such as diet drinks, that make the healthier lifestyles of Americans.…show more content…
In this case, the variable of taste has changed the market for soft drinks. Over the years, more and more Americans have become knowledgeable and conscious about their dieting habits due to an increase in obesity. Therefore, they have changed their habits or tastes for specific products such as soda, which is very high in sugar.

In the graph, I display how the new preference for healthier foods has caused the demand curve for soft drinks to shift to the left. In addition, because fewer people are interested in purchasing soda, the supply curve also shifts to the left. A new equilibrium is set with less soft drinks being sold and a slightly lower price to reflect its shift in demand and
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