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PepsiCo dives into functional drinks with Ardea

By Chris Mercer , 23-Jan-2006

PepsiCo's bottling arm has bought up US functional drinks maker Ardea Beverage, as the iconic soft drinks firm positions itself for growth on the functional drinks market.

Pepsi said it would work with its second largest bottler, PepsiAmericas, to market Ardea's airforce Nutrisoda brand across North America.

The deal, signed for an undisclosed fee, will help PepsiCo to extend its healthy food and drink range; something that recently propelled the firm ahead of Coca-Cola in market value for the first time in 112 years.

 

Nutrisoda, launched in 2003, contains a range of functional additives including L-Arginine and other amino acids, CoQ10, vitamins, minerals and herbs; all to create what Ardea calls "a health spa in a can". The products also claim to contain little or no sugar, carbohydrates and calories.

 

There are seven different varieties formulated to achieve specific benefits, such as Immune in tangerine and lime flavours, Calm in wild berry and citron and Focus in mango and peach.

 

PepsiAmericas said that "while small, the airforce Nutrisoda brand is resonating with consumers".

 

Robert Pohlad, chief executive of PepsiAmericas, said: "The Nutrisoda brand complements our growing portfolio of healthier beverages, providing a unique and fashionable beverage alternative."

 

He said the brand "has tremendous potential in the fast-growing functional beverage category".

 

Joe Heron, founder of Ardea, said: "More than 20m US consumers describe themselves as physically active and nutritionally aware. Whether the goal is to energize [sic] or boost immune systems, Nutrisoda provides intelligent solutions."

 

The US functional food and drink market was worth $19bn in 2004, according to a recent report by market research group Datamonitor.

 

John Band, Datamonitor analyst, said Americans seemed more willing than their European counterparts to accept added ingredients in products. Around 45 per cent of Americans said they distrusted health-boosting claims for food and drink, compared to 63 per cent of Britons and 56 per cent of Germans.

 

Band said the functional sector was still expected to grow strongly in both the US and Europe, but that communication and credibility of claims would be key.

 

"Health claims can be relevant, but labels don't do enough to communicate what they mean."

 

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