Pepsi NEXT risks re-hashing failed concept with new flavour: analyst

By Joe Whitworth and Ben Bouckley

- Last updated on GMT

Related tags Pepsi max Coca-cola Pepsi

Actress and Pepsi NEXT 'believer' Eva Longoria
Actress and Pepsi NEXT 'believer' Eva Longoria
PepsiCo’s new mid-calorie cola brand ‘NEXT’ risks 're-hashing a failed concept behind a new flavour', despite data supporting low-calorie cola growth, according to Euromonitor International.

Jonas Feliciano, Euromonitor Beverages analyst, said that NEXT could be a product in search of a market just months after its launch in March, and the question “that plagued previous [mid calories] launchesremains: is there really a market for the close-but not-quite?”.

It remained an open question, Feliciano said, whether a mid-calorie, rather than low-calorie, market entrant – seeking to tap demand from calorie watchers who disliked diet drinks – would gain much traction in an increasingly complex US diet cola category.

Both PepsiCo and the Coca-Cola Company had successfully launched low calorie carbonates – Pepsi Max and Coke Zero – positioned at young adult males with artificial sweeteners to mimic full calorie products, he noted, but avoiding any mention of ‘diet’ due to the word’s female associations

Targeting everyone and no-one?

But Feliciano suggested that NEXT (60 calories per 12oz can, 60% less than regular Pepsi) risked mid-calorie limbo, while PepsiCo’s marketing lacked the definite focus evident in Dr Pepper’s tongue-in-cheek marketing of TEN as “not for women”.

PepsiCo is targeting consumers who dislike the taste of diet drinks but are health conscious, and the firm plans to increase its overall marketing budget by 15-20% to US$600m (€462.6m).

For NEXT PepsiCo has named urban artist Nicki Minaj as a Pepsi ‘spokesperson’, hired Desperate Housewives star Eva Longoria to hand out free samples in Times Square and paired-up with viral video comedy sites.

But NEXT risked “targeting everyone at once, but no one in particular​”, Feliciano warned, while previous mid-calorie launches (Coca-Cola C2 and Pepsi Edge, for instance) got stuck in “product limbo”​, with the benefits of C2, for instance, not distinctive enough to draw consumers.

Men rejected the hybrid drink because they wanted full flavour with no calories or carbohydrates, not half, and Pepsi Edge failed for the same reason, Feliciano added.

He said: “With the emergence and success of both Coke Zero and Pepsi Max, why would consumers choose Pepsi Next’s 60 calories when they can have Zero? Or why choose ‘close but not quite’ on flavour when they can have the real thing?”

Arresting carbonate declines

With full flavour carbonates expected to remain in decline over the next five years, it was understandable that Pepsi wished to target consumers exiting the category, the analyst said, “but offering them a compromise may be a mistake – one that the company has already made three times before”.

Although PepsiCo believes NEXT will be different, the analyst also said there was some scepticism as to whether it tasted exactly like regular Pepsi as the firm claims, where its new flavouring system comprising Acesulfame K, aspartame, sucralose and high fructose corn syrup.

But Feliciano cited one online review stating that NEXT “starts out with a sweet, more traditional Pepsi flavour, before switching to the often reviled aftertaste associated with artificial sweeteners”.

Likewise, Dr Pepper TEN’s early success was not evidence of a burgeoning market for mid-calorie soft drinks, the analyst said, given that Dr Pepper’s 23 flavours masked the aftertaste of artificial sweeteners in a way that Pepsi did not.

He added: “Similarly, while Dr Pepper TEN is positioned almost identically to Coke Zero and Pepsi Max, albeit with ten calories, Pepsi Next is seeking an entirely new mid-calorie market: one that did not exist in 1975, 1993, nor in 2004 [previous abortive mid-calorie launces].”











Related topics Markets PepsiCo Fizzing-Up Carbonates

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1 comment

NEXT has a chance because......

Posted by Jeff Loman,

.......C2 was "premium priced" when it hit the market, and consumers never tried it.

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