1.0 Background and rationale for the proposal

1.1 Introduction

Carbonated soft drink is a key component of beverage market of the world. Even in Sri Lanka, this is a highly competitive market which both global and local brands are operate. However, growth of the industry has been declined in recent time. This could be a result of many different factors. The objective of this research is to identify the impact of health awareness on the degree of purchase intension of carbonated soft drink customers in Sri Lanka. In recent times, people also highly focus on health awareness. Thus, it is important to evaluate these two aspects.

1.2 Rationale for the research proposal

The launch of artificial sweeteners included carbonated soft drinks has led to huge boost of the beverage market (Jennifer, 2011). Even in Sri Lanka, carbonated soft drinks which contain artificial sweeteners, higher percentage of sugar and calories are highly popular in the market, throughout the decades. According to American Journal of Public Health, the main reasons for customers’ demand for carbonated soft drinks are taste, thirst, availability, promotion, advertising, convenience and affordability.
On the other hand, they have also highlighted key reasons that people avoid consuming carbonated soft drinks. Perceived risk of obesity, perceived risk of diabetes, belching and heartburn, possible tooth decay, poor nutrition and perceived risk of heart disease are main reasons among many more (Jennifer, 2011). Mintel (2005) and many more researchers has identified that consumers are shifting from carbonated soft drinks to alternative heathy and natural drinks in considerable rate including fermented drinks, teas and lower sugar beverages . As a result of that, demand for carbonated soft drinks has been reduced parallel to the increase of health consciousness of the people (Anette, 2011). Same time, leading carbonated soft drink brands has introduced low sugar contained drinks and zero calorie drinks to maintain competitive positions.
This is an area which is many researches do not touch in Sri Lankan context. There will be good stepping stone to fulfill the knowledge gap by analyzing correlation between heath consensus and purchasing intention (PI) of carbonate soft drink consumers. Based on this, researchers can conduct more studies in future related to more advance areas in this matter. Instead of academic aspect, this study will be useful for commercial and administration purpose to make investment and administrative decisions. Therefore, this research will be useful for key players in Sri Lankan market to determine growth strategies. Further, this will be also useful for policy decision makers in health and consumer affair sector to take policy decisions. This is also important for companies which intent to enter to this market and companies in tea, fruit juice or any other healthy drink business, FMCG companies, retailers such as supermarket and hyper market and also entrepreneurs.

1.3 Research problem identification

As mentioned in introduction, it is forecasted that market growth will be decline in next five year compared to last five years. Considering key players, even though Ceylon Cold Store (CCS) maintains its market leadership position, CCS’s sales growth in soft drink category has been significantly dropped (CCS annual report, 2020). Global brands such as Coca-Cola and Pepsi also experience similar situation. This has reinforced the significance of identifying evolving behavior of customers’ perspective which shift form carbonated soft drinks.
Above rationale for the research proposal indicated certain reasons for customers’ though process to switch form carbonated soft drinks to alternative healthy drinks. This customers’ perspective is signaling the increasing health awareness on their purchase decision making process. There is not enough marketing literature in Sri Lankan context. Therefore, examining this knowledge gap would lead to develop new opining regarding this matter and also it would assist to future academics and researchers to conduct more studies.
According to above explanation, below research problem is identified to reach the objectives of this study.
Does Health Awareness (HA) affect the degree of Purchase Intention (PI) of Carbonated Soft Drinks’ (CSD) customers in Sri Lanka?