The cola giants, like seemingly everyone else, are embracing the low-carb diet fad this year. Still plagued by declining sales of their flagship brands, Pepsi-Cola and Coca-Cola will look to new health-conscious mid-calorie products for a sales lift. Both companies are expected to spend heavily behind the product launches, which promise half the calories in Coke and Pepsi.
Pepsi Edge was the first offering announced. Slated for late summer, the No. 2 soft drink company is expected to position the product as low sugar versus low calorie. Pepsi equated the media spend with past new product launches. For example, it spent about $27 million to roll out Pepsi Vanilla.
Coca-Cola's mid-cal drink, believed to be named C2, will launch with a major ad campaign this summer estimated to be close to $50 million.
Cadbury Schweppes is considering a mid-cal Dr Pepper and 7 Up product. However the company's major reorganization of its North American beverage division may have thrown a wrench into the works.
Despite all of the hoopla surrounding these new items, the cola companies will also work to keep their campaigns for their core products in the spotlight. Coke's "Real" effort has been the first well-received creative for the master marketer in about a decade. This summer the company is expected to launch a major promotion using satellites to pick prize winners. Coke spent $108 million behind the brand in 2003, per TNS/CMR.
Pepsi retired the "Joy of cola" in favor of the more direct "It's the cola" campaign, via BBDO, New York, at the end of last year. The campaign positions the beverage as the perfect complement to food. Pepsi shelled out $90 million in 2003 for the brand. Both No. 1 Coke and No. 2 Pepsi saw their market share decline 0.7 percent, according to Beverage Digest, Bedford Hills, New York.
Diet Pepsi kicked off its new "It's the diet cola" campaign earlier this year and will continue to push the brand, which grew its share 0.3 percent last year. Diet Coke, up 0.4 percent, is expected to break a new campaign shortly via FCB, New York. Pepsi spent $24 million on its diet brand (the No. 6 soft drink brand) last year compared to No. 3 Diet Coke's $5 million.
On the flavor front, No. 4 Mountain Dew will continue to roll out new offerings. Earlier in the year it began its Dew U, six-month continuity program. This month it re-introduces its orange LiveWire extension. Later this year it may launch a limited-time black-colored soda likely to be named Pitch Black or Midnight. It received $59 million in support last year.
Coke's Sprite (No. 5) kicked off a new campaign earlier this year starring LeBron James and a smart-mouthed puppet named Thirst. Its flavored Remix line bowed a berry line extension earlier in the year. And its diet brand will likely relaunch under the name Sprite Zero later in the year. The lemon-lime category leader spent $30 million on media.
Sierra Mist, Pepsi's answer to Sprite, is receiving a lot of support in its second year of national distribution. The No. 9 brand rolled out new "Yeah it's kind of like that" creative during the Super Bowl, with more to come. The drink will be a partner with this summer's Shrek 2. The new brand was up 0.7 percent last year.
The No. 7 Dr Pepper and No. 10 7 Up are keeping the course this year with its "Be you" and "Make 7 Up Yours" campaigns via Young & Rubicam, New York. Changes are likely in store as Cadbury's beverage division was realigned to have new marketing head Randy Gier handle all marketing for all beverage brands.—Kenneth Hein
Considering water actually falls from the sky and is available just about everywhere for free, it continues to amaze that the colorless, flavorless stuff sells like hotcakes. The category leaders Pepsi's No. 1 Aquafina (up 20.8 percent) and Coke's No. 2 Dasani (21.9 percent) are still experiencing strong double-digit volume growth with little signs of slowing.
Aquafina is preparing a new brand campaign with new agency BBDO, New York. The effort is slated for the summer. PepsiCo spent $24 million on the brand last year. Dasani is rerunning its "Can't live without it" ad campaign from Berlin. Coke spent $19 million on the brand.
Nestlé Waters continues to see across the board growth for all of its regional brands with Arrowhead (up 27.2 percent), Poland Springs (up 11.7 percent) and Deer Park (up 24.8%). Nestlé spent $7 million on its portfolio last year.
On the enhanced water front, Gatorade's Propel recently launched new executions of its "Drip" campaign. The water, which is flavored and enhanced with vitamins and minerals, grew 61.8 percent last year. Its media budget was $34 million.—K.H.