The food-and-drinks giant plans to spend 30% more to pitch its beverages on U.S. television in 2011 than in recent years, with much of the money aimed at propping up the sagging Pepsi-Cola brand after Diet Coke overtook it last year for the first time to become the No. 2 soda in the U.S. behind regular Coke.
PepsiCo is also working [image-nocss] overtime to develop better-tasting, low-calorie natural sweeteners for its colas, revamp its packaging and make other tweaks to its product line-up as part of a broader overhaul to try and claw back market share, according to the report.
"When my ancestors went from the Middle Ages to the Renaissance, they blew up the place, so that's what we are doing," Massimo d'Amore, chief executive of PepsiCo Beverages Americas, told the newspaper.
Pepsi-Cola and Diet Pepsi, as previously reported in CSP Daily News, saw their U.S. sales volumes in 2010 fall sharply, by 4.8% and 5.2%, respectively, according to industry data published Thursday by Beverage Digest, a trade publication and data service. Those numbers contrasted with a more modest 0.5% industrywide decline in U.S. carbonated soft-drink sales.
PepsiCo's market share in carbonated soft drinks slipped 0.6 percentage point to 29.3% last year, while Coca-Cola's share inched up 0.1 percentage point to 42.0%.
Some analysts think the Purchase, N.Y.-based company has been too focused on its other businesses in recent years, including a relaunching of the sports drink Gatorade and new forays into more nutritious snacks, at the expense of its U.S. soda business, according to the report.
d'Amore said PepsiCo is "totally committed" to expanding its soft-drink sales and plans to launch a new television-advertising campaign for its flagship Pepsi-Cola this summer.
PepsiCo also is shelling out about $60 million to sponsor "X Factor," a television talent show that debuts this autumn, in response to Coca-Cola's nearly decade-long sponsorship of "American Idol." The company didn't disclose what its total TV ad-spending plans are.
The moves represent a reversal from last year, when PepsiCo largely eschewed TV advertising to market its flagship cola through the Refresh Project, a marketing initiative that disbursed $20 million in charitable grants to various projects through online votes.
PepsiCo says Refresh was a success, with 87 million votes cast, but many industry analysts have questioned whether it helped sell colas as much as traditional advertising.
"We need television to make the big, bold statement," said d'Amore, while adding that PepsiCo also remains committed to Refresh.
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