Sunday, July 26, 2009

G is for huh?

A couple days ago the WSJ reported the earnings for PepsiCo, which sagged thanks to poor sales numbers from Gatorade, it's second largest selling drink by volume next to Pepsi-Cola. According to the report, Gatorade lost 4.5% of their market share down to 75% and volume slipped 17.5% in the first six months of this year.

Why I find this so interesting?

Back in January, Gatorade received a makeover to bring a bit of "coolness" back to the brand. They simplified the product label to a large "G" complimented with a smaller signature lightning bolt. In their advertisements, they ask: "What's G?"

Personally, I was a bit confused at first. I thought it might be a new flavor or a new line of drinks on the way. Turns out, I was in the majority. According to Mr. Pecoriello, cheif executive of ConsumerEdge Research LLC, when they asked, "people weren't sure." So what is G? It's the "heart, hustle and soul of athleticism," which I learned for the first time after reading the WSJ article.

This is not the only redesign Pepsi misplayed recently. In February, Pepsi pulled back from it's Tropicana redesign to return to the more familiar orange with a straw in it after consumers complained. Also, the latest Pepsi redesign was welcomed with mixed results.

I'm not accusing poor redesigns of being the only reason for the drop in sales-the overall category is down 12 percent and their is growing competition from similar jucies, teas and energy drinks. However, I don't beleive it's a coincidence either.

Regardless, this is not good news for the Pepsi, which just three years ago proclaimed they had trouble meeting demand for Gatorade.

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