Gatorade, Powerade & BodyArmor: How PepsiCo and Coca-Cola are playing in the sports drink category
Zero sugar and personalized innovations have been driving the category forward; while both companies see the potential of the sports category appeal to a wider audience and tap into increased emphasis on health and wellness as a result of the pandemic.
Category leader Gatorade
PepsiCo’s Gatorade has a legacy of some 50 years: presenting itself as ‘the most scientifically researched and game-tested way to replace electrolytes lost in sweat’.
Yet the brand has also moved with the times: such as with the brand’s organic launch in 2016, the debut of Gatorade Zero in 2018, and innovations such as a smart cap to give athletes direct hydration feedback on their personal smart cap vessels.
And in pandemic times, the drink is resonating with consumers, as health and wellness takes top priority and exercise becomes a point of focus, according to PepsiCo CEO Ramon Laguarta.
PepsiCo’s beverage division suffered early on in the pandemic with the key convenience channel shut off, but by October Laguarta was optimistic about trends for the sports drink category, seeing more people exercising, and embracing daily routines of exercising at home: “That helps the sports drink category and obviously Gatorade as a leader in that category.”
And leader it is, with the brand taking a chunky 67.7% share of the US sports drink market.
Innovation: Zero and personalization
Designed to draw back lapsed Gatorade consumers who have concerns over sugar, Gatorade Zero has proved to be an ‘amazing innovation’, according to CEO Ramon Laguarta, with the brand now reaching an estimated $1bn retail sales value in 2020.
But in 2021, it’s personalized solutions that the CEO is most excited about. “As we think about the future of Gatorade, we couldn't be more excited about what we see. Obviously, moving into other spaces - natural, energy - those could be spaces," he said in the company's FY2020 earnings call in February.
“But where we see the biggest opportunity for Gatorade is in creating more of a personalized solutions for athletes and kind of amateur athletes, like most of us, and creating a much more engaged relationship where we become advisers of the athletes, of their hydration needs, of all their nutrition needs and we see an opportunity to create much more of a full ecosystem of engagement with the consumer.
“We provide solutions, we provide products and we provide information. And I think that's the real future of Gatorade, which is a massive brand that has so much trust from consumers. I think we can leverage that trust in providing much more than just a liquid hydration.”
The power of Powerade... and the potential of BodyArmor
Coca-Cola’s big-hitter, meanwhile, is Powerade. And like PepsiCo with Gatorade, it also offers Powerade Zero (which has, in fact, been on shelves since 2008 - far longer than Gatorade Zero) and other innovations in the sports drinks category.
In 2020 it launched the ION4 system, which replaces the four primary electrolytes lost in sweat (sodium, potassium, calcium and magnesium), alongside Powerade Ultra (a sports drinks including new shelf-stable creatine, branched-chain amino acids, vits B3, B6 and B12 and 50% more ION4 electrolytes compared to original Powerade.
This was followed by Powerade Power Waters, a ION4 electrolyte and B vitamin enhanced sports water.
Like PepsiCo, the company saw the need to category for ‘broadening sweat occasions’ – seeking to meet the evolving and varied hydration needs of athletes spanning the activity spectrum.
Essentially, it said, the brand’s mission is ‘to champion the power of sports for all’.
Gatorade takes the largest share of the US sports drinks category at 67.7%, followed by Powerade at 13.7% and BodyArmor at 9.3% (Euromonitor figures for 2020).
PepsiCo and Coca-Cola, therefore, dominate the market accounting for an 81% share together (and a 91% share if BodyArmor was included).
But Coca-Cola is also focusing on up-and-coming sports drink BodyArmor. The brand was created in 2011 by Mike Repole and Lance Collins (who were joined by the late Kobe Bryant as the #3 shareholder in 2013) positioned as a premium sports drink with no artificial colors or flavors and containing potassium and other electrolytes, vitamins and coconut water.
It also has BodyAmor Lyte Sports Drinks – which contains the same nutrients as BodyArmor but is naturally sweetened and with 20 calories and 3g sugar per serving.
BodyArmor SportsWater, meanwhile, is an alkaline premium sport water with pH 9+, while BodyArmor Edge is boosted with 100mg caffeine.
The brand counts Naomi Osaka, Megan Rapinoe, Mike Trout and Dustin Johnson among ‘Team BodyArmor’.
Coca-Cola took a minority stake in BodyArmor in 2018, tucking it into its Venturing and Emerging Brands (VEB) portfolio and setting out ‘a path to ownership under defined terms’. At the time, it highlighted the attraction of the fast-growing sports performance and premium hydration categories. Coca-Cola is now reportedly looking to acquire a controlling interest in BodyArmor.
If Coca-Cola does take on full control of BodyArmor, that would give it a 22% share of the US energy drink market - still far behing Gatorade's 67.7% share. The question will be whether Gatorade can continue to innovate and stay relevant with today's consumers; or whether Coca-Cola can successfully execute the potential of trendy challenger BodyArmor to boost its share of the category.
Gatorade (thirst quencher 20oz)
Powerade (mountain berry blast 20oz bottle)
BodyArmor (strawberry banana 12oz bottle)
90 (150 if scaled up to a 20oz size)
21g (35g if scaled up to a 20oz size)
sugar, dextrose, electrolytes
HFCS, electrolytes, B vitamins
coconut water concentrate, pure cane sugar, electrolytes, B vitamins. Free from artificial flavors, sweeteners or dyes