Wednesday, October 15, 2014

Cola Wars Go Green?

Ronn Torossian believes it had to happen sooner or later. The world’s two top soft drink companies have gone green. But not in the way you might be thinking. Recently, both Coke and Pepsi have introduced new low-calorie drinks with one thing in common – Stevia, a natural-based sugar substitute sweetener. Something else these products have in common? Green labels, presumably to echo the “natural” nature of these soft drink options.

PepsiCo has announced that it will launch Pepsi True in mid-October, though it likely won’t be rolling out in stores anytime soon. For now, consumers ccccr US debut last August, and that was in a very limited capacity. But this November, Coca-Cola Life will be available nationwide.

Pepsi True will be available in the familiar 12-ounce cans. Coca-Cola Life will come in both cans and 8-ounce bottles.

Torossian says it’s important to note that, although these are “reduced calorie” offerings, they may not necessarily be able to be marketed as sugar free or “diet” soft drinks. It’s an interesting strategy for both companies. Finding a niche between niches, so to speak. Consider, the new offerings might appeal to regular Coke and Pepsi drinkers who are looking to reduce their sugar and calorie intake. And it might sound good to current diet soda drinkers who just can’t get past the taste.

Coke and Pepsi are hoping to attract consumers from both of these groups to create a market overlap that currently doesn’t exist. Sure, many folks will take either diet or regular in a pinch, but for the most part, these groups are strictly delineated … and by their own choice.

Torossian says that leads to yet another difficult PR risk. Both companies are risking splitting their own customer base. This is not the same as splinter groups, such as Mountain Dew drinkers or Mr. Pibb drinkers. How will the companies address the intentional sacrifice of both regular and diet customers in order to build a market for their stevia brands? It’s an interesting PR and marketing conundrum, but look for the market to provide an answer – and likely in a short period of time.

Like Crystal Pepsi and New Coke before them, new soda ideas that don’t immediately produce generally have a short shelf life.

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