Ben Wise on Branding

Watching the world through the lens of the brand

Pepsi Brand Chases the Health Conscious

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It is no secret that consumers are moving toward healthier lifestyles (or at least trying to!). In light of this change, brands have to evolve their positioning to meet the new realities of the market. Pepsi is taking a big step in this direction.

Last week, Pepsi announced that they will be removing their sugary beverages from schools worldwide. Pepsi is clearly placing a bet that the loss of sales will be outweighed by the value it brings to their brand. This is a pretty safe bet for three reasons:.

  1. First Mover Advantage
  2. Compared to Coke, Less of Pepsi’s Brand Portfolio is Soft Drinks
  3. Already Out of US Schools

First Mover Advantage:

In their never-ending battle with Coke, it can be hard to find meaningful differentiation. Being the first of the two to take a global stance gives the Pepsi brand an association with being a responsible corporation. Even if Coke follows suit, it will be viewed as much less genuine without the first mover advantage.

Compared to Coke, Less of Pepsi’s Brand Portfolio is Soft Drinks:

Pepsi’s portfolio of brands is much more diversified than that of Coke. Obtaining an association to their brand of childhood health can be leveraged across their entire portfolio. This gives this position much more value to Pepsi than it would to Coke.

Already Out of US Schools:

In 2006, both Pepsi and Coke agreed to stop selling sugary drinks in US schools. Any loss of sales from this move will therefore not impact their biggest market. While it will impact some of the fastest growing markets (ie China), they are less reliant on soft drinks than the US. Again, the benefits from the move will still occur in the US without any change to their US operations.

What do you think? Can Pepsi credibly associate their brand with being healthy?

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Written by benwisebranding

March 22, 2010 at 8:46 pm

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