SodaStream Maker Trying to Burst Big Soda's Bubble?

Coca-Cola, PepsiCo not biting on Birnbaum's bluster

Published in CSP Daily News

AIRPORT CITY, Israel -- Home carbonation beverage system maker SodaStream International Ltd. said that it is taking on "Big Soda" to take market share from the soft drink giants with the launch of its first global TV campaign and some posturing from its CEO

"Coca-Cola Co. and PepsiCo Inc. will have to face the reality that their business model cannot be preserved forever. The world is changing and we're going to call it out," SodaStream CEO Daniel Birnbaum told The Wall Street Journal.

"I think it is criminal that the industry, led by two big companies, will do anything to protect their antiquated business model. They are generating 35 million bottles and cans every single day in the U.K. alone. Worldwide, it is one billion bottles and cans, most of which just go to trash, landfill, the oceans or parks. It's insane," he added.

With the tagline "If you love the bubbles, set them free," SodaStream's new commercial, The SodaStream Effect," is airing on U.S. major broadcast and cable networks, and will later roll out into many of SodaStream's 45 global markets.

"The SodaStream Effect is aimed at establishing a strong brand image and distinct lifestyle positioning. We are on a mission to empower consumers to make the world a better place by eliminating bottles and cans, and to enjoy bubbles without the bottles," said Ilan Nacasch, CMO of SodaStream.

"There are an alarming 460 billion bottles and cans manufactured every year, of which the vast majority--nearly one billion per day--are dumped as waste across parks, oceans and landfills," said Birnbaum."We challenge the entire beverage industry and its arguably outdated business model, showing people that when you can make soda straight from tap water, there exists a smarter choice."

Click here to view the commercial.

Atlanta-based Coca-Cola and Purchase, N.Y.-based Pepsi did not respond to Birnbaum's comments.

But Coca-Cola told the Journal that it has a target to recover about 36% of bottles and cans sent to market, rising to 50% by 2015. In the same timeline, it also wants a quarter of its polyethylene terephthalate, the industry's main manufacturing raw material, to come from recycled or renewable sources.

Pepsi, which said that a fifth of its output in 2010 was sold in reusable glass, told the newspaper that it produced the world's first 100% plant-based PET bottle made from bio-matter such as grass, pine bark and corn husks. Pepsi is piloting the bottle this year and will move to "full-scale commercialization" if successful.

Earlier this year, SodaStream displayed 10,000 used soft-drink cans and bottles found in Johannesburg, South Africa, to highlight the throwaway culture. In response, Coca-Cola issued a cease-and-desist order. A spokesperson said the company's trademarked products were used "in a manner contrary to [the group's] clear commitment to recovery and recycling."

Airport City, Israel-based SodaStream manufactures beverage carbonation systems which enable consumers to turn tap water instantly into carbonated soft drinks and sparkling water.

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