PepsiCo launches line of cocktail mixers as drinking at home surges


Dive Brief:

  • PepsiCo is launching a new line of nonalcoholic cocktail mixers called Neon Zebra designed to appeal to younger consumers spending more time at home who want to avoid complicated cocktail recipes or large-format mixers, the company said in a statement.
  • The beverages are made with real juice and no artificial sweeteners. They come in four options: Margarita Mix, Strawberry Daiquiri Mix, Mojito Mix and Whiskey Sour Mix.
  • The offering from PepsiCo is the latest in a series of beverage rollouts targeted toward specific consumer groups or drinking occasions. Earlier this month, PepsiCo launched a line of juice waters called Frutly aimed at teens, and last year introduced a functional beverage, Driftwell, for relaxation and decreasing stress. 

Dive Insight:

While PepsiCo may be best known for Mountain Dew, Gatorade, Aquafina and its namesake cola, it has been aggressively moving into new categories through internal innovation and acquisitions.

PepsiCo pivoted away from sugary soda in a big way with its $3.2 billion purchase of SodaStream and the 2018 launch of sparkling water Bubly, which has no artificial flavors or sweeteners. Gatorade released Bolt24 to encourage people to consume sports drinks throughout the day rather than just when working out, and it debuted a sugar-free version in Gatorade Zero. It has since added a Bolt24 option with caffeine.

The latest product launch in nonalcoholic cocktail mixers with Neon Zebra taps into the better-for-you trend with real juice and no artificial sweeteners. 

The at-home cocktail trend was growing before the pandemic. But with bars, restaurants and other establishments where alcohol is served closed or dealing with capacity limits, and people spending more time at home, the segment has soared. U.S. consumers spent $304.6 million on cocktail mixers in the 52 weeks ending Feb. 13, 2021, an increase of 36% from the prior year, according to data provided to Food Dive by Nielsen. In the previous period — 52 weeks ending Feb. 15, 2020  —  cocktail mixer sales edged up only 1.2%. 

“With at-home cocktail consumption on the rise, we saw an opportunity to build and disrupt this fast-growing category with a product that meets consumers’ needs for convenience — to cut out time and mess without compromising on quality and taste,” Emily Silver, vice president of innovation and capabilities at PepsiCo Beverages North America, said in a statement.

Beverage makers looking for growth have been targeting the mixer category.  Start ups like Q Mixers are popular with many consumers. And Drinkworks, a partnership established in 2017 between AB InBev and Keurig Dr Pepper, developed a Keurig-like machine that creates cocktails such as an Old Fashioned, White Russian, Long Island Iced Tea and a mojito. Coca-Cola introduced its own line of cocktail mixers for dark spirits in 2019, but the products were only available in England. 

For PepsiCo, Neon Zebra allows the drink maker to enter the alcohol space in a roundabout way with a beverage used to make popular concoctions like margaritas and daiquiris even if it’s not actually producing the booze itself. Coca-Cola did something similar when it announced that Molson Coors will be the exclusive manufacturer, marketer and distributor in the U.S. of a hard seltzer version of its Topo Chico brand. PepsiCo also will have an opportunity to expand beyond the first four cocktails if the initial round proves to be a success, providing it with a way to grow the brand.

Neon Zebra enables PepsiCo to tap into another consumption occasion, particularly if consumers show a willingness to stay in after the worst of the pandemic has abated, further hurting sales of its sodas and other beverages away from home. With PepsiCo working aggressively to expand its offerings, the company is trying to meet consumers whenever and wherever they are, even if its competitors are doing the same thing.

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