An unlikely industry is being hit by the retail apocalypse
Plummeting mall traffic isn't just hurting retailers like Sears and Macy's — it's impacting soda giants like Coca-Cola.
According to Coca-Cola CEO James Quincey, a monumental shift in the way consumers shop is forcing the beverage company to change its own sales tactics.
"Digital is changing the way you behave," Quincey told Bloomberg's Jenny Kaplan. "It affects other categories that are not the primary reason you thought about making the shopping trip."
In Coca-Cola's case, fewer trips to the mall translates to fewer people buying sodas at vending machines and mall food courts.
Quincey has experience with dealing with the effect of ecommerce on the soda industry. Quincey told Bloomberg that in early 2016, while he was Coca-Cola's COO, soda sales in China slumped simply because people were ordering more takeout online — and Coke's bottles weren't well-suited to be delivered.
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More than 3,200 store closures have been announced by brick-and-mortar retailers such as Sears, Macy's, and JCPenney so far in 2016. As these "anchor stores" shut down locations, malls are forced to find new tenants to fill the super-sized spaces or risk losing rent payments.
The decline of the American mall is also hurting food court-centric restaurant chains such as Sbarro and Cinnabon, as well as casual dining chains like Applebee's and Chili's that often set up shop in or around bustling shopping centers.
But declining mall traffic declining mall traffic is hardly Coke's biggest problem. The fact remains that Americans are less interested in drinking soda than they used to be.
In 2016, soda sales fell for the 12th year in a row. The trade publication Beverage Digest reported in April that sales of soda by volume dropped 1.2% last year.
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