It's green, so it's got to be natural, right? Image:

Call it the green cola wars. PepsiCo (NASDAQ:PEP) is making available for the first time on store shelves its stevia-based midcalorie soda Pepsi True, which could challenge for supremacy Coca-Cola's (NYSE:KO) stevia-sweetened Life brand that rolled out nationally late last year. To ensure consumers make the connection with the sodas' natural ingredient, both brands come packaged in green-colored bottles and cans.

Pepsi's three-state trial run follows what was apparently a successful launch online, where the diet soda was originally available only through (NASDAQ:AMZN) before expanding onto Wal-Mart's (NYSE:WMT) website.

Dr Pepper Snapple Group (NYSE:KDP) is also testing stevia-based versions of Dr Pepper, 7-Up, and Canada Dry in three markets following the failure of its 10-calorie TEN line to gain any traction.

A Hail Mary pass
The beverage makers need the stevia-laced drinks to be a hit. Carbonated soft drink volumes continue to fall, with Pepsi reporting North American soft drink volume down 1.5% last quarter and Coke similarly saying its sparkling beverages were off 1% from the same period in 2013.

The rivals are particularly concerned about diet soda sales, which are now approaching a decade of falling volumes.

Diet sodas have lost their fizz with consumers. Data: Beverage Digest.

Turning to the plant-based sweetener stevia is a last-ditch effort by all three beverage makers to reverse the trend. More knowledgable consumers question the ingredients being added to their food and drink, with artificial flavors such as aspartame, acesulfame potassium, and high fructose corn syrup falling sharply out of favor.

It's a bit ironic, though, because it was consumer concern over sugar's role in causing obesity that drove the beverage companies to the artificial sweeteners in the first place. While the drinks were successful at one time, and pushed Diet Coke to the position of second-best-selling soda (behind only Coke itself), consumer sentiment has turned once more.

A taste for adventure
The early returns from Coca-Cola Life's test run at least seem encouraging. One market researcher indicated last year the soda received an overwhelmingly positive response from consumers, which could help explain Coke's decision to go national.

However, this isn't the first time the soda makers have dabbled with stevia as a sweetener. Shortly after the FDA approved rebaudioside A (a stevia extract) for use as a dietary supplements in 2008, Coke, Pepsi, and DrPepper Snapple all launched drinks made with it.

Coke launched Sprite Green using Truvia, the tabletop stevia sweetener it developed with Cargill; Pepsi added the Pure Via stevia extract it created with Whole Earth Sweetener Co. to a line of SoBe drinks (and has sold Pepsi Next with stevia in Australia for several years); and Dr Pepper partnered with sports drink maker All Sport to introduce a zero-calorie sports drink flavored with rebiana, the trade name for rebaudioside A.

Coca-Cola is trying to inject some life into its soda sales with its own stevia-based cola. Image:

Chemically dependent
However, these products' failure to catch on was often due to complaints of a chemical aftertaste, which is a fairly common criticism of stevia-sweetened food and drink (Coke recently pulled its stevia-spiked Vitaminwater because consumers complained about the different taste profile). That might be because unlike going out to your garden and plucking a leaf from your stevia plant, commercially produced extracts are highly processed sweeteners.

Truvia, for example, is made with erythritol, a sugar alcohol that occurs naturally in fruit and fermented foods, but Cargill instead makes it from carbohydrates such as sucrose, glucose, and starch. It then chemically converts it into dextrose that is fermented with yeast and heavily processed until erythritol is created.

Hardly "natural," and Cargill settled a lawsuit in 2013 over claims Truvia was so processed it couldn't be marketed as such.

Consumers, though, seem to be giving these latest stevia-based drinks a pass so far, but that could be because they're still so new and perceived as being naturally flavored. When their true highly processed nature becomes more apparent, Coke, Pepsi, and Dr Pepper Snapple could face a backlash similar to what they witnessed with the artificial sweeteners: a further erosion in soda sales.

Even so, these are still niche products and won't move the needle much on revenue or profit, meaning the beverage giants will continue to suffer from the downward spiral of carbonated soft drinks volumes. Coca-Cola might look to premium milk products for relief and PepsiCo to its snack division, leaving DrPepper Snaffle Group the odd man out. In no case, though, is this a sweet deal for any of them.