PURCHASE, N.Y. -- PepsiCo said it plans to significantly expand its U.S. noncarbonated portfolio. The strategy includes the introduction of two new products from the makers of Gatorade: G2, its first differentiated beverage since the original Gatorade, and an enhanced water from Propel called Propel Invigorating Water.
The strategy also includes maximizing the reach of G2 and the Propel line by leveraging PepsiCo's bottlers and providing distribution rights to the new family of Gatorade products in select channels and simultaneously restaging PepsiCo's [image-nocss] two enhanced waters: Aquafina Alive and SoBe Life Water.
Since Gatorade was introduced in 1967, the brand has focused on satisfying active thirst, amassing a loyal user base and generating more than $5 billion in U.S. retail sales. Now, for the first time, the company will expand the Gatorade trademark beyond active occasions to a new platform.
G2 is a low-calorie electrolyte beverage with 25 calories per 8-oz. serving. It will be the company's largest new product launch since Propel Fit Water.
Propel was introduced nationally in 2002. Propel Invigorating Water is designed to not only hydrate and nourish, but also address a key consumer need by providing a boost for active people throughout the day. The new vitamin-enhanced water is mildly caffeinated and lightly flavored, with 20 calories per 8-oz. serving.
Pepsi bottlers currently deliver SoBe, Aquafina and other Pepsi-Cola products in all channels of trade. Beginning later this year, the expanded Gatorade arrangement will enable Pepsi bottlers to distribute G2 and the Propel line to small-format customers, including convenience stores, gas stations and independent retail outlets.
SoBe Life Water is being reformulated with sucrose (table sugar), antioxidants, vitamins and natural herbs. Each flavor will have a unique blend of ingredients offering a distinct benefit. SoBe Life Water's new formulations will have 35 calories per serving30% fewer than before. Lightly flavored Aquafina Alive offers consumers added, recognizable benefits without extra calories. It is being reformulated with a new sweetener blend, additional nutrients and fewer calories.
Somers, N.Y.-based Pepsi Bottling Group president and CEO Eric J. Foss said, Aligning our portfolio with PepsiCo to further participate in the hydration category ensures we are executing one of our key strategic initiatives of building an advantaged brand portfolio. With today's announcement, we will be even better positioned in the fast growing hydration segment. Our lineup starts with Aquafina, the No. 1 unflavored water, coupled with Aquafina FlavorSplash, the No. 1 fitness water with Propel and a repositioned SoBe Life Water and Aquafina Alive in the fast growing enhanced vitamin water segment. This combination creates the leading portfolio of enhanced water brands in the small-format channel. The addition of G2 from Gatorade, a low-calorie electrolyte beverage, to our portfolio gives us access to the important high-growth isotonic category. Combined with our existing Gatorade business in foodservice, G2 gives us a valuable and scaleable isotonic cold drink platform.
He added, Together with PepsiCo, we believe our direct-store-delivery system provides a distinct competitive advantage.
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