The battle for consumer attention in the e-commerce food and beverage market is starting to heat up.
Coca-Cola, for instance, recently made headlines when the company re-introduced its widely popular Surge soft drink back onto the market after well over a decade of discontinuation. First introduced in 1996, this beverage was pulled off of shelves after only a few years. Now, after much petitioning, the beverage is back. But there is a twist—it’s being sold exclusively online.
Now, PepsiCo is following suit. In just a few weeks, the rival food and beverage company will unveil its highly anticipated Pepsi True soft drink, which will also be sold exclusively on Amazon.
But while the two beverages might be in direct competition, they are actually very different products.
Pepsi True is being marketed with the promise of no high fructose corn syrup (HFCS) or artificial sweeteners—which is in direct contrast to Surge. Instead, Pepsi True is sweetened with stevia leaf extract and pure sugar. The product is actually more comparable to the new Coca-Cola Life beverage, which contains a green and white label and is being marketed as a “mid-calorie” cola. It too uses stevia instead of corn syrup. But Coca-Cola Life, which recently made its U.S. debut in select retailers in the south, is not being offered online.
So, why is Pepsi True being sold exclusively on Amazon? It could have a lot to do with the fact that online distribution comes with far less risk. The company can test this product without having to pay for nationwide distribution to retail outlets. PepsiCo is also choosing to spend less on marketing, using YouTube to promote the new product. If the product does well, the company might eventually decide to allow stores to buy Pepsi True in bulk.
PepsiCo’s decision to sell online could also be appeal to health-conscious consumers. After all, soda is a product that is often purchased on impulse. Now, consumers have the option to think about the product ahead of time and reflect on its contents before purchasing it.
The decision to sell Pepsi True online also reflects the company’s interest in the rapidly expanding e-commerce food and beverage industry. A recent report from BI Intelligence shows that between 2013 and 2018, online grocery sales will increase at a compound annual growth rate (CAGR) of 21.1 percent and will reach about $18 billion by that time. In comparison, offline grocery sales will only increase by about 3.1 percent.
It remains to be seen how thirsty consumers will respond to PepsiCo’s marketing decision. As for now, we will have to wait a few more weeks to see whether the product’s flavor and marketing campaign will pay off like Surge, which has already sold out online.