Diet Pepsi has fared no better with sucralose as its principal sweetener, and Pepsi is now bringing its old aspartame-fueled recipe back via a sub-brand called ‘Diet Pepsi Classic Sweetener Blend' with new 'retro' packaging, although it will continue to use sucralose in the flagship Diet Pepsi brand.
The decision - first revealed by Beverage Digest - is simply about giving consumers more choice, said PepsiCo in a statement: “Consumers want choice in diet colas, so we’re refreshing our US lineup to provide three options that meet differing needs and taste preferences.”
While PepsiCo never said the old recipe would completely disappear, however (CEO Indra Nooyi said in July 2015 that the aspartame-sweetened version would be sold online for fans unhappy with the sucralose-sweetened version), the fact it is now planning a full-blown bricks & mortar retail launch of the old recipe with new branding suggests that there were more than a few unhappy fans out there.
Rearranging the deckchairs on the Titanic?
It also smacks of desperation, argue some branding experts, who were never convinced by the move in the first place.
The problem, according to industry sources we quizzed about the move, is that Diet Pepsi's woes were never just about aspartame, just as declining sales of many legacy food brands can’t solely be attributed to their use of ‘artificial’ ingredients given that cleaning up the labels in question hasn’t made these brands sexy again.
Consumers, speculated CBD Marketing EVP Jean Ban, many simply be growing bored of Diet Pepsi and Diet Coke, regardless of the sweetening system these brands adopt (as evidenced by the lackluster performance of stevia-sweetened Coca-Cola Life and Pepsi True), and now have a bewildering array of other options to choose from.
She told FoodNavigator-USA: “How many more cola SKUs can we possibly fit on shelves? These constant tweaks to formulas and packaging, adding a new SKU to satisfy this or that taste preference, are just delaying the inevitable.
"Perhaps declining sales are really about evolving habits and the macro-trends around what people actually want to drink and consume.”
According to Nielsen data provided by Wells Fargo (all US retail channels including grocery, drug, mass, and c-stores in the 12 weeks to May 21, 2016) dollar sales of Pepsi's diet/low cal offerings plummetted 9.6% year-on-year while Coca-Cola's diet/low-cal sales fell 5.7%.
Pepsi's full sugar carbonated soft drinks fared a little better with sales down 4.3%, while Coca-Cola's were down 3.2% over the same period.
Paddy Spence: 'This is a stark reminder of what separates the brands of yesterday from the brands of today and tomorrow'
Paddy Spence, CEO at Zevia, the fast-growing zero-calorie range of carbonated soft drinks (CSDs) sweetened with stevia and monk fruit, told FoodNavigator-USA that the move served as "a stark reminder of what separates the brands of yesterday from the brands of today and tomorrow."
He added: "Legacy diet carbonated soft drinks brands such as Diet Pepsi are trying to hold onto the consumers they have, and yet as we’ve seen, switching out one artificial sweetener for another has not proven compelling enough to keep people within the brand franchise.
"Brands such as Zevia, on the other hand, have evolved along with the consumer by offering zero calorie natural sweeteners like stevia, and created a consumer relationship built on trust. We are bringing people back to CSDs by offering choices that today’s shopper is asking for.”
Beginning in September:
- Pepsi MAX will be re-introduced as Pepsi Zero Sugar in the US “to more clearly communicate to consumers that it is a zero-calorie product. The formula will stay the same.”
- Diet Pepsi Classic Sweetener Blend (sweetened with ace K and aspartame) will be introduced in three SKUs in ‘retro’ packaging in 12-packs, 2-liter bottles and 20-ounce bottles at retail outlets nationwide.
- Diet Pepsi (sweetened with ace K and sucralose) will continue to be PepsiCo’s primary diet cola offering.
Toying around with sweeteners is utterly pointless... Consumers have wised up
Dr Rachel Cheatham, founder and CEO of consultancy Foodscape Group LLC, meanwhile, said the issue facing Diet Pepsi was not which sweetener to pick.
"Desperation to reverse declining sales has set the stage for an apparent race to the diet soda bottom. At this point, toying around with aspartame versus sucralose, aspartame plus ace-K, or whatever mixture of the artificials that's either brand new or classic, is utterly pointless," she told FoodNavigator-USA.
"Consumers have wised up. Even if they happen to have no real concerns about the safety of artificial sweeteners (the ones in question are all approved for use after all), it doesn't take much observational power to realize that diet soda has not lived up to its supposed "diet" benefit. Seemingly, no matter how much diet soda we drink, we're still caught in a massive obesity epidemic."
Yes, this is about choice, but no longer about 'diet' choice
She added: "I disagree with the statement about 'consumers want choice in diet colas.' I would rephrase to consumers want choice in non-diet beverages from teas, seltzers, spritzers, green juices, kombucha and all the rest. Yes, this is about choice, but no longer about 'diet' choice.
"Ultimately, diet soda is like a sunk cost, and it's important to know when to cut business loses and move on to more innovative beverages. Consumers have moved on in droves, and it's time PepsiCo does the same."
The above chart from Euromonitor International highlights just how much volume the carbonated soft drinks category has lost over the past 10 years, although juice has also lost ground. So what are consumers drinking instead? Bottled water (easily the biggest winner), energy drinks, ready-to-drink coffee and tea, and sports drinks, said senior beverages analyst Howard Telford during our Feb 2016 beverage innovation summit .