IB Business Management HLTopic 8 — Pre-Released Statement 2025Paper 1Industry context~12 min read
Background on the Industry
Myt operates in three markets at once, and they are at three different stages. Soft drinks are huge but under pressure. Bottled water is large and growing. Healthy snacks are smaller but climbing fast. Knowing roughly how big each one is turns a vague answer into a confident one.
📚 What you need to know
The global soft drinks market was worth around $465 billion in 2024 and is growing at roughly 5–6% a year.
The global bottled water market was worth around $336 billion in 2024, with premium water growing fastest.
The healthy snacks market was worth around $91 billion in 2024 and is expected to roughly reach $147 billion by 2033.
Soft drinks are dominated by Coca-Cola, PepsiCo and Keurig Dr Pepper; bottled water by Nestlé, Coca-Cola and PepsiCo.
Traditional fizzy drinks face pressure from sugar concerns and taxes; growth is in water, energy drinks and functional drinks.
Bottled water faces criticism over plastic waste, water extraction and occasional contamination.
Three markets, three sizes
Healthy snacks looks small next to soft drinks, and that is the point: it is a growth bet, not a replacement for the core business.
The soft drinks market
This is Myt’s home ground, and it is enormous. Around $465 billion in 2024, growing steadily, and expected to keep growing into the late 2020s as demand for non-alcoholic drinks rises.
Three companies dominate: Coca-Cola, PepsiCo and Keurig Dr Pepper, with Coca-Cola holding the largest share of global retail volume. Underneath them sit familiar brands like Pepsi, 7Up, Dr Pepper and Snapple, plus a growing crowd of smaller health-focused challengers.
What is changing
Traditional fizzy drinks are under pressure from health concerns about sugar and artificial additives.
Energy drinks and bottled water are leading growth, reflecting the shift towards health-focused choices.
Prebiotic sodas that claim digestive benefits have become a real category, with brands like Olipop and Poppi popular enough that the giants have launched their own versions.
Regulation is tightening. Sugar taxes and rules on plastic are reshaping recipes and packaging.
Emerging markets matter. Growth is strongest where incomes are rising and local brands are appearing.
Myt is a mid-sized player in a market run by giants. That single sentence is worth remembering, because it explains why Myt cannot simply outspend its rivals and has to find another angle.
The bottled water market
Around $336 billion in 2024 and expected to grow strongly for the next decade. Demand comes from health awareness, doubts about tap water quality in some regions, and convenience. Premium bottled water is the fastest-growing slice, which is why Honest Water is potentially valuable rather than just big.
But this market carries reputational baggage that Myt has now inherited.
WHY HONEST WATER WAS A GOOD BUY
A large and reliably growing market.
Fits Myt’s existing bottling and distribution skills.
Healthier image than sugary drinks.
Premium water grows faster than the market average.
WHAT CAME WITH IT
Plastic bottle production and disposal cause pollution.
Criticism over how much groundwater firms extract.
Legal risk around recyclability claims on packaging.
Contamination scares can force large product recalls.
The awkward link. Myt announced greener factories and then bought a bottled water company. Bottled water is one of the most criticised categories in the whole drinks industry on plastic waste. Any answer about Myt’s sustainability plans should acknowledge that these two decisions pull in opposite directions.
The healthy snacks market
Smaller than the other two — around $91 billion in 2024 — but growing steadily and expected to keep going. The drivers are busy lifestyles, urbanisation and demand for convenient food that is not junk.
Trend in snacks
What it looks like
What it means for Myt
High protein
Protein bars, nuts and meat-based snacks.
Requires food production expertise Myt does not have.
Plant-based
Snacks made from lentils, chickpeas and other plant sources.
Fits a healthier brand image and a growing customer group.
Gut health
Prebiotic and probiotic snacks, mirroring the prebiotic soda trend.
The clearest overlap with Myt’s drinks knowledge.
Low carb and keto
Cheese crisps and nut-based bars.
A niche, but a profitable one with loyal buyers.
The obstacles are real: snacks must be healthy and taste good, sustainable sourcing and packaging are expected, and health claims are regulated differently in every country — a genuine headache for a multinational.
🤔 Is healthy snacks actually a good idea for Myt?
The market is a fifth the size of soft drinks, it is crowded with established food companies, and Myt has never made food. Against that, it fits the direction consumers are moving and it reinforces the healthier image Myt is trying to build. The strongest exam answer is not yes or no but how: enter through a partnership or acquisition rather than building from scratch, because Myt has manufacturing capability in liquids, not solids. Saying that shows judgement rather than opinion.
Worked examples
WORKED EXAMPLE
Describe two possible risks to Myt PLC of entering the bottled water market. [4]
Risk 1 — strong established competition
The market is dominated by very large firms with well-known brands. [1] Myt would need heavy marketing spend to build recognition for Honest Water against rivals that already own shelf space worldwide. [1]Risk 2 — environmental criticism
Bottled water is attacked for plastic waste and for the volume of groundwater extracted. [1] That directly undermines Myt’s announced plan for greener factories and gives pressure groups an obvious target. [1]4 / 4Two marks for the risk, two for tying it to Myt’s own stated plans. That contradiction is the strongest application available.
WORKED EXAMPLE
Analyse two effects of changing consumer preferences on Myt PLC. [6]
Effect 1 — the core business gets squeezed
Consumers are moving from traditional fizzy drinks towards water, coffee and functional drinks. Since Myt built its portfolio on sugary carbonated drinks, revenue from its oldest products is likely to flatten or fall, which threatens the cash cows that fund everything else.
Effect 2 — but it also creates the opportunity
The same shift is why Honest Water and Lotssa Coffee are attractive assets, and why the healthy snacks market is worth considering. Myt’s acquisitions position it in the exact categories consumers are moving into.
The catchEveryone can see the same trend. Coca-Cola and PepsiCo are launching prebiotic sodas and expanding into healthier ranges, so the growth markets are crowded and margins may be thinner than the headline growth rates suggest.
Two effects plus a well-evidenced limitationNaming real competitors shows industry knowledge and takes ten words.
💡 Exam tip
Learn three numbers, not thirty. Roughly $465bn, $336bn and $91bn is plenty.
Say “approximately”. It shows you know the figures are estimates and protects you if the case gives different ones.
Use competitor names. Coca-Cola, PepsiCo, Nestlé — each one is free application credit.
Compare growth rates and size together. A fast-growing small market is a different bet from a slow-growing huge one.
Bring up the plastic contradiction in any sustainability answer. It is the sharpest point in this section.
Do not turn the answer into a market report. Two figures used well beat a paragraph of statistics.
⚠ Common mix-up
A growing market is not an easy market. Growth attracts competition.
Bottled water is not automatically the healthy choice from an environmental point of view.
Market share and market size are different. Myt could grow while losing share.
Coffee shops are retail, not manufacturing. The cost structure is completely different.
Prebiotic sodas are still soft drinks. They are a category shift, not an escape from the industry.
Do not quote figures as exact. Sources disagree, and examiners know it.
Up next: Trends Shaping the Industry — sugar reduction, greener factories and digital avatars, and what each one really costs.
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