Around this time last year, SodaStream looked unbreakable. Fresh off a successful Super Bowl ad campaign, the Israeli sparkling beverage maker announced more than 50% sales and net income growth for 2012 and raised guidance for the year ahead. Investors swooned and the stock climbed 40% in the following four months.

A year later, things look a little dicey, to say the least. As my colleague Dan Caplinger put it, "[T]he at-home soda-maker specialist has investors in a near-panic about its future prospects."

What changed? Well, SodaStream's third-quarter earnings growth decelerated, management warned of a flat holiday sales season, and a giant of the beverage industry, Coca-Cola (KO -0.16%), decided to challenge SodaStream on its own turf.

The market, without some sort of significant reassurance from management on Wednesday's earnings call, seems certain SodaStream is losing its fizz. A buyout from Pepsi, many believe, would be SodaStream's saving grace.

But the earnings shortfall, to give SodaStream the benefit of the doubt, could be a short-term hiccup. Management blamed "logistical" issues, a temporarily altered product mix, and a currency fluctuation as the key culprits of weak fourth-quarter results. Analysts are expecting only a penny per share.

The concern for many investors, however, is not whether SodaStream can leap a short-term hurdle. Let's assume, for a moment, that each of these issues is in fact "100% addressable" as SodaStream claims. And let's assume that the company's biting the bullet now to boost household penetration, a nobler long-term goal.

What happens, though, when the next hurdle for SodaStream is a towering Goliath in the form of Coca-Cola and Green Mountain Coffee Roasters' Keurig Cold machine?

In the world of soda, an industry largely driven by intangibles like brand loyalty and flavor amplitude, Coke has both qualities in droves. And Green Mountain brings a deep well of expertise in creating convenient, easy-to-use household beverage appliances.

SodaStream, at least on the surface, seems outmatched. Despite having a century of experience under its belt, SodaStream's fighting an uphill battle as it aims to challenge Coke in the brand loyalty category. Consider the chart below, which shows the relative expenditures of both companies on advertising and marketing:

As SodaStream's management team has pointed out before, Coke spends SodaStream's yearly budget as though it was a weekly allowance. Coke's brand power is like a steel coat of armor that SodaStream's unlikely to penetrate.

From my perspective, SodaStream investors must believe that the company can continue on its upward climb by providing a better, more convenient machine and by capitalizing on a growing interest in healthier beverages. If, in fact, Green Mountain is able to one-up SodaStream with its Keurig Cold device in terms of convenience and personalization, two increasingly important characteristics, it will strike SodaStream where it counts. Game over.

But if SodaStream's machine proves superior, there's no reason its advance will be stopped short. Furthermore, as I have pointed out, SodaStream can succeed without Pepsi by giving consumers a world of choice that doesn't include the two dominant labels. What it needs to do, however, is tack on as many complementary brands that consumers love as it can. They might not carry the same cachet as Coke or Pepsi, but they could provide a healthier alternative. And the virtual duopoly those companies created is not forever. Taste preferences for beverages can be as diverse as taste preferences for any other product.

In other words, SodaStream's an underdog, but its success does not depend on defeating Goliath. SodaStream just needs to offer something Coke can't replicate easily or that Coke won't replicate due to its reliance on sales of core products.

By its own account, SodaStream controls only 0.2% of the global soft-drink market and 2% of the sparkling-water market today. The opportunity is tremendous, and there's room for multiple players.

For SodaStream to stay relevant, however, it needs to prove that no one, not even a Goliath like Coke, can beat it at its own game by making an overall better at-home carbonated beverage machine. It's SodaStream's crucial weapon and the key to this underdog's long-term success. 

SodaStream's wood-panelled Source device. Source: SodaStream.