Shop Talk

Retailers, consumers and prices

New Gatorade is not for couch potatoes

March 24, 2010

massimoPepsiCo’s move to launch higher-end Gatorade products at GNC stores across the nation gives the brand higher profit margins and instant credibility as a sports nutrition brand, according to a high-level Pepsi executive.

The sports drink’s historic Gatorade brand was overhauled last year into simply “G” and then expanded with the ”G Series,” which is meant for before, during and after a work-out. Earlier this week, the company unveiled the “G Series Pro” line, aimed at serious athletes.   

Massimo d’Amore, CEO of PepsiCo Beverages Americas, said in an interview that the selling of the new line at GNC stores (and later at Dick’s Sporting Goods stores) will have a “very positive impact” on the brand as a whole.

“You are where you sell,” d’Amore said. “The fact of being here gives us the credibility that will have a positive halo on the entire franchise. So for us that’s already a good enough reason to do it.”

But on top of that, d’Amore said that with Gatorade only selling in mass retail channels, it never captured consumers who shop at GNC, known for its vitamins and sports nutrition products. In other words, any sales from these stores will be gravy on top of Gatorade’s sales at more typical grocery and convenience stores.

“We’re looking at it as a long-term, profitable niche, totally incremental to Gatorade,” he said. Since the pro series is priced higher than standard Gatorade products, the line has the potential to increase the brand’s profit margins over time, d’Amore said.

Included in the pro series are a carbohydrate energy drink for before activity (with a suggested retail price of $2.99 for 12 ounces), an  endurance formula for during activity ($2.49 for a 24-oz bottle) and a protein recovery shake ($4.29 for a 17-ounce bottle). By contrast, the price of the recovery drink in the standard series ranges from $1.79 to $2.99 for 17 ounces.

The company also unveiled Gatorade Natural and G2 Natural, made with a sweetener derived from the South American stevia bush. Those products, to be sold exclusively in Whole Foods stores, cost $1.49 for 16 ounces.

D’Amore dismissed the suggestion that the flurry of new products would confuse consumers, noting that the categorization actually makes it simpler for consumers. And when asked which Gatorade someone (like yours truly) should drink if they don’t exercise but are merely thirsty, d’Amore conceded that Gatorade may not be the right choice.

“There will never be a Gatorade for couch potatoes,” d’Amore said. Though he hinted that “there will be more news to come, even for consumers like yourself”.

We’ll stay tuned.

(Photo: PepsiCo)

Comments

I understand it is a new product and people will indeed buy to try out, but how does GATORADE plan to compete with other products GNC provides for endurance, fuel, and recovery that cost much less? I think the costs are much too high…..especially the recovery drink. $4.29 for 17 ounces is ridiculous. My recovery protein shake i currently use costs me about $.86 per serving and provides 24 grams of protein. Why should i buy the new Gatorade Recovery that only provides 16 grams and this price? Selling at GNC is about being impressive on the back of the label…..not the name on the front of it!

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