PepsiCo is making 'a much bigger play' for sales in the burgeoning plant-based market
https://www.fooddive.com/news/pepsico-is-maki...ood%20Dive
PepsiCo is accelerating the development of plant-based foods it hopes could one day rival sales generated by some of its popular chip, tea and soda brands.
The CPG's snack portfolio, which includes everything from Doritos and Sun Chips to Sabra hummus and Quaker oatmeal, has long depended on plant ingredients such as corn, chickpeas and oats. But PepsiCo is moving aggressively to expand its offerings to prioritize the use of plants that provide functionality attributes and have a more environmentally friendly footprint.
“Our core brands utilize agricultural commodities, but this is more than that. This is also positive nutrition on top of that," said René Lammers, PepsiCo's chief science officer. "Ultimately, we want to make this a much bigger play for us.”
During PepsiCo's February earnings call, CEO Ramon Laguarta singled out plant-based snacking as a category the company is using to generate future growth. PepsiCo posted sales of $70.37 billion in 2020, an increase of 5% from the prior year. Organic revenue is forecast to increase in the mid-single digits in 2021, in line with its long-term outlook.
Giving consumers more choice
To fuel its long-term growth in plants, PepsiCo has entered into a series of acquisitions, new product introductions and extensions to existing brands.
The company's juice and smoothie brand Naked Juice introduced in January a product that blends pea and soy protein. The drink builds on Naked's other plant-based protein beverages that include a combination of fruits and a few that mix together whey and soy.
Anup Shah, vice president and chief marketing officer of the juice portfolio at PepsiCo Beverages North America, which includes Naked Juice, Tropicana and KeVita, said his segment is "dabbling" in plant-based options. While he said the juice portfolio doesn't plan to shift entirely to alternative proteins, Shah expects future product launches to give shoppers more choices.
"We know consumers are asking for more plant-based options and so we're trying to deliver on that consumer need," he said.
Among the biggest announcements for PepsiCo came in January when it established a joint venture called The PLANeT Partnership with Beyond Meat that will develop, produce and market snack and beverage products made from plant-based protein.
In 2018, PepsiCo also has purchased plant-based protein bar, mix and snack maker Health Warrior and baked fruit and vegetable snack manufacturer Bare Foods. Hilo Life, a brand within PepsiCo’s Hive accelerator, recently launched an almond flour-based tortilla chip.
"Our core brands utilize agricultural commodities, but this is more than that. This is also positive nutrition on top of that. Ultimately, we want to make this a much bigger play for us."
René Lammers
Chief science officer, PepsiCo
And Evolve, a maker of plant-based bars, shakes and powders that uses pea protein, was overhauled in March with new packaging, advertising and flavor profiles to raise brand awareness. PepsiCo purchased Evolve as part of a $465 million deal with Hormel Foods in 2019 that also added Muscle Milk to its portfolio.
https://www.fooddive.com/news/pepsico-is-maki...ood%20Dive
PepsiCo is accelerating the development of plant-based foods it hopes could one day rival sales generated by some of its popular chip, tea and soda brands.
The CPG's snack portfolio, which includes everything from Doritos and Sun Chips to Sabra hummus and Quaker oatmeal, has long depended on plant ingredients such as corn, chickpeas and oats. But PepsiCo is moving aggressively to expand its offerings to prioritize the use of plants that provide functionality attributes and have a more environmentally friendly footprint.
“Our core brands utilize agricultural commodities, but this is more than that. This is also positive nutrition on top of that," said René Lammers, PepsiCo's chief science officer. "Ultimately, we want to make this a much bigger play for us.”
During PepsiCo's February earnings call, CEO Ramon Laguarta singled out plant-based snacking as a category the company is using to generate future growth. PepsiCo posted sales of $70.37 billion in 2020, an increase of 5% from the prior year. Organic revenue is forecast to increase in the mid-single digits in 2021, in line with its long-term outlook.
Giving consumers more choice
To fuel its long-term growth in plants, PepsiCo has entered into a series of acquisitions, new product introductions and extensions to existing brands.
The company's juice and smoothie brand Naked Juice introduced in January a product that blends pea and soy protein. The drink builds on Naked's other plant-based protein beverages that include a combination of fruits and a few that mix together whey and soy.
Anup Shah, vice president and chief marketing officer of the juice portfolio at PepsiCo Beverages North America, which includes Naked Juice, Tropicana and KeVita, said his segment is "dabbling" in plant-based options. While he said the juice portfolio doesn't plan to shift entirely to alternative proteins, Shah expects future product launches to give shoppers more choices.
"We know consumers are asking for more plant-based options and so we're trying to deliver on that consumer need," he said.
Among the biggest announcements for PepsiCo came in January when it established a joint venture called The PLANeT Partnership with Beyond Meat that will develop, produce and market snack and beverage products made from plant-based protein.
In 2018, PepsiCo also has purchased plant-based protein bar, mix and snack maker Health Warrior and baked fruit and vegetable snack manufacturer Bare Foods. Hilo Life, a brand within PepsiCo’s Hive accelerator, recently launched an almond flour-based tortilla chip.
"Our core brands utilize agricultural commodities, but this is more than that. This is also positive nutrition on top of that. Ultimately, we want to make this a much bigger play for us."
René Lammers
Chief science officer, PepsiCo
And Evolve, a maker of plant-based bars, shakes and powders that uses pea protein, was overhauled in March with new packaging, advertising and flavor profiles to raise brand awareness. PepsiCo purchased Evolve as part of a $465 million deal with Hormel Foods in 2019 that also added Muscle Milk to its portfolio.
