I can’t think of a more depressing movie in recent years than Wall-E. Even the worst horror movie presents a more balanced image of human failings than Wall-E, which sees the whole human race devolved into a state of lazy stupor, carted around on mechanized chairs and sucking soda from straws—too fat to move. Nobody wants that future. Not even the soda companies.
In fact, the world’s largest beverage company, Coca-Cola, is also among the most active in trying to promote healthy living. And it should: Coca-Cola has a responsibility to the quality and well-being of its customers’ long-term health. After all, a well-crafted product that gets you sick is a shoddy product. Luckily, the company recognizes the problem. It even cites statistics from the World Health Organization that show how worldwide obesity has more than doubled since 1980. But those statistics are only the beginning.
More than 1/3 of adults in the U.S. are obese—not just overweight, but obese. And the costs are high. Medical costs associated with obesity in the United States now exceed $147 billion every year. Just how much is that? Well, Apple is the biggest company in the world by market capitalization. In 2012 its net income—its worldwide profit—was $41 billion. So, multiply Apple’s money-making power by three and you’re still $24 billion shy of the costs of obesity in the United States. But what does that mean at the individual level? Medical costs for people who are obese are $1,400 higher every year than those of normal weight. Fourteen hundred dollars...Just think what you could do with that money instead: you could buy a flight to Hawaii. You could book a cruise to Alaska. You could rent an RV and take the family on a trip to the Grand Canyon—and when you got there, you could hike all the way down and back up again without a second thought. For $1,400 you could feed a family of four for nearly two months.
But obesity isn’t only about money. Recently, the world passed an important threshold; overeating became a worse problem than hunger. The finding came from the biggest study of world health ever conducted, bringing together nearly 500 scientists across 50 countries in what’s being called the Global Burden of Disease Report. For the first time in human history, more years were cut from human lives by eating too much than from not eating enough.
by Brendan Steidle
What’s been Coca-Cola’s role in all of this, and all of the other soft drink companies? It’s hard to tell. Surely intaking unnecessary calories will contribute to one’s weight. The average can of soda adds an extra 150 calories to your diet, most from sugar. According to Harvard’s School of Public Health, drinking just one can of soda a day could add an extra 15 pounds to your weight in one year. But that’s not to say Coca-Cola has been inactive in trying to find a solution to the problem.
Health advocates may role their eyes and cynics may scoff, but the company’s efforts have been real and sustained. You’ve probably noticed the increase in popularity of diet or other alternative beverages like Coke Zero. In fact, the old rivalry between Coca-Cola as the number one most popular soft drink and Pepsi at number two is no longer true: Diet Coke now outsells Pepsi. The Coca-Cola Company has greatly increased its diet and low-calorie offerings; there are 10 times as many healthier options today as there were 20 years ago, and three times as many as there were just a decade ago. All of these new options have reduced the average calorie count in Coca-Cola’s beverage mix by an impressive nine percent globally since 2000.
That said, the company does have a somewhat stilted answer when asked about obesity. In both their 2008 and 2012 Sustainability Reports, Coca-Cola repeats the same sentiment: “weight gain is primarily the result of energy imbalance—too many calories consumed and too few expended.” It’s rather convenient, this formulation, since it suggests that you might be able to make up for drinking soda by simply exercising more.
Coca-Cola has been a long-time proponent of greater exercise. It currently sponsors more than 280 physical activity and nutrition education programs in over a hundred countries worldwide. Recently, it announced a plan to spend $5 million to place 100 new fitness centers in schools around the country.
The idea of making up extra calories by exercising more is nothing new. In fact, even the Health Department of New York endorsed this tit-for-tat between calories and activity with a series of very effective subway ads.
Unfortunately, the health-effects of soda consumption aren’t so easily tamed. In addition to obesity, soft drinks have also been linked to diabetes and heart disease. A recent study tracking the health of nearly 90,000 women over 20 years found that those who drank just one sugary soda a day doubled their chance of developing Type 2 diabetes. Women who had more than two servings a day had a 40 percent higher risk of heart attack. It didn’t matter if the women had different diets or exercise or weight—drinking soda still increased their health risks.
Children and Obesity
On the surface, children seem to be in a better position. While two out of three adults in the U.S. are obese or overweight, only one out of three children are. But dig a little deeper and the bright spot fades. Nine out of ten children drink sugary beverages, and the amount of calories they consume from them has increased by 60 percent in just the last two decades. For teens, sugary drinks like soda, energy and sports drinks are now the top calorie source in their diets, beating out all other food groups. Think about that—a drink, a liquid, beats out food as the number one source of calories for teens—not mac-n-cheese, not sugary cereals, not candy—not even pizza: the food group at the base of the pyramid for teens is soda. And it has its costs: for every extra can of soda a child consumes on a daily basis, their odds of becoming obese increase by 60 percent.
But we can’t just blame this on the beverage companies. Coca-Cola, at least, has a strict policy against advertising to children. Not only does it abstain from advertising on children’s television programs; it won’t advertise on any program if kids represent more than 35 percent of the audience. And when the company does show kids consuming soda, it always shows them doing so under the supervision of an adult.
Coca-Cola’s social responsibility efforts even go beyond obesity. For example, in many parts of the world, you can get a Coke faster than you can get life-saving drugs. Now, Coca-Cola is doing something about it. Recently, the company partnered with the Global Fund to Fight AIDS, Tuberculosis and Malaria to apply its supply chain expertise to deliver life-saving drugs to patients in Tanzania faster than ever. Delivery times were cut from 30 days to just 5.
So Coca-Cola has the right idea, but even with all of this positive momentum—more alternative beverages, real commitments to active living, new artificial sweeteners like stevia, and the introduction of an innovative 7.5 ounce mini-can—the Coca-Cola Company remains a contributor to the obesity epidemic. The company’s 2020 vision of doubling its business is troubling when you consider that in its latest annual review, the CEO boasted about how “we ramped up our efforts to win with Coca-Cola, the oxygen of our business.” To be clear, he’s talking about the full-calorie Coca-Cola beverage, not the company as a whole. He goes on to gush about growing this full-calorie soda brand by more than three percent in 2011, equivalent to nearly 350 million additional cases.
The bottom line: the company is investing in new alternatives, its scientists are working to reduce calorie counts, but its executives and marketers are not ready to make any dramatic moves on existing brands. Instead, they introduce new brands as “healthy” alternatives. The company now has low-calorie or no-calorie alternatives for 19 of its 20 top brands. But these are alternatives only, and even as science increases the taste fidelity of diet sodas, consumer perceptions may remain stubborn. If you tried a diet cola 10 years ago and didn’t like it, you may never try a diet alternative again, even if it’s been vastly improved in flavor. How can the company combat this? How can it change consumer behavior? As we'll see in the next section, this isn’t just an opportunity to make a difference, it’s also a tremendous business opportunity. If only Coca-Cola is bold enough to take it.