Major Brands No Longer Sweet on High-Fructose Corn Syrup

Gatorade, Wheat Thins Among Products Ditching HFCS for Sugar

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NEW YORK (AdAge.com) -- Bowing to consumer demands, major brands are removing high-fructose corn syrup from some of their products in favor of sugar. Few, however, are shouting it from the rooftops as it would cast a shadow on those products that still contain HFCS.

POP CULTURE: Mtn Dew recently launched limited-time, sugar-sweetened versions of its colas.
POP CULTURE: Mtn Dew recently launched limited-time, sugar-sweetened versions of its colas.
Hunt's ketchup, Gatorade and Wheat Thins are all permanently ditching corn syrup for sugar. Heinz has created a sugar-sweetened version of its iconic ketchup, while Pepsi and Mtn Dew launched limited-time, sugar-sweetened versions of their colas. But with all of these reformulations, only Pepsi and Mtn Dew have made any noise to date.

"We know moms don't like it, and they don't want to feed it to their kids," said supermarket expert Phil Lempert, who has pushed for HFCS removal for a decade. "As a result, the brands that lead the pack to get rid of it, they're going to see an uptick in sales." He added that the sugar shift is an easier one for consumers than say fat-free cheese. Most consumers either don't notice a taste difference or prefer the sugar version.

In that case, why would marketers downplay the change? "There is a risk there," said Gary Hemphill, managing director-chief operating officer at Beverage Marketing Corp. "That's one of the reasons I don't see it being a centerpiece to a marketing campaign."

Indeed, in looking for and switching to alternatives such as cane sugar, brands are coming across a host of marketing challenges. The biggest risk is that trumpeting sugar could undermine other products in the portfolio that will continue to use HFCS. For instance, Heinz is launching "Simply Heinz" this month, though the rest of its ketchups will continue to use HFCS. The product is being billed as part of the marketer's lifestyle range, which also includes organic and reduced-sugar ketchup. Heinz says it is not planning a marketing campaign for the new line.

Avoiding overreach
Brands must also be careful not to miss the mark by aggressively promoting the change to consumers who may not have given HFCS much thought.

"We know HFCS was of interest to some of our consumers, but not all," a Wheat Thins spokesman said. The brand chose not to broadcast its shift to sugar, though it did market the broader product overhaul, focusing on the benefits of whole grains. New packaging references the lack of HFCS in the product, but it's "not a core message in our marketing," the spokesman said.

Gatorade declined to share specifics of its marketing plans around the reformulation of Gatorade and G2. But a spokeswoman said that targeted communications are planned to address audiences who have expressed concerns about HFCS, namely moms and health professionals. "Removing HFCS is part of our long-term strategy to reinforce the functional benefits and quality of Gatorade and G2," she said. "Through our research and understanding of athletes, we have learned many have a negative perception of HFCS."

Hunt's is planning to market its ketchup overhaul, hitting shelves in May. "We made the decision to take it out due to consumer's desire for shorter, simpler ingredient lists," a spokeswoman said, adding, "consumers preferred the taste."

PepsiCo has been one of the most aggressive brands marketing its sugar shift. But because of the limited nature of the offering -- two eight-week periods in recent months -- the company was insulated from the concerns plaguing marketers making permanent changes to their formulas. Pepsi Throwback and Mtn Dew Throwback were featured in 30-second TV spots and promoted via social media. A Pepsi spokeswoman said the company didn't have any concerns that the limited-time offering would shine a negative light on the company's HFCS products.

Natural alternatives
Marketers and industry experts agree that the shift has been brought on primarily by consumers, who have begun to question the use of HFCS in food and beverage products, as they gravitate toward what they consider to be more natural products.

Another alternative has emerged in stevia, a natural sweetener approved for use in food and beverages by the FDA in December 2008. According to Mintel, in the first eight months of 2009, 110 products using stevia were launched.

Sugar Association President Andrew Briscoe said that his organization has helped out marketers where it's seen fit. But the organization has generally tried to stay out of the way. The Sugar Alliance, which conducts lobbying for sugar farmers, won't ramp up its efforts until next year, when drafts of the 2012 Farm Bill begin to circulate. Sugar farmers don't receive subsidies in the U.S., which is why prices have generally been higher than those of corn.

Most manufacturers switched to HFCS in the 1970s and 1980s, as corn subsidies made the sweetener extremely cheap. However, increased ethanol production in recent years has boosted the price of corn, and consequently corn sweeteners. According to the USDA, the average price of HFCS during fiscal 2009 was 31¢ a pound, while sugar prices averaged 36¢ a pound. Yet sugar prices have spiked dramatically in 2010, 53¢ per pound in February, compared with 27¢ for HFCS.

For its part, the Corn Refiners Association has mounted a massive advertising and PR offensive to dispel the myth that corn sweeteners are less healthy than sugar. The organization's research underscores that the body processes all sweeteners the same, be they processed or natural.

Can a soda tax really curb obesity?

As some marketers look to swap out high-fructose corn syrup for sugar, proposals to tax sweetened beverages are popping up around the country -- even if the beverages are sweetened with sugar. The question remains, though: Will such schemes actually do anything to curb obesity?

Researchers and politicians are trying to tackle that question, but there's no clear consensus yet. One recent study from a trio of researchers hailing from Yale, Emory and Bates looked at how changes in state taxes affected body mass index, and found that a 1% tax increase resulted in a 0.003-point decrease in BMI. The researchers calculated that a 58% tax on soda, which is roughly what cigarettes are taxed, could reduce the mean BMI in the U.S. by 0.16 points. That hardly makes the proposed tax increases appealing as a measure to reduce obesity.

Arkansas and West Virginia have targeted taxes on soft drinks. Yet, they also boast obesity rates among the nation's highest. West Virginia ranks third, with an obesity rate of 31.2%, while Arkansas ties for 10th, with an obesity rate of 28.7%, according to the CDC. In the last year, proposals on soft drinks were raised in 12 states. New York Gov. David Paterson has proposed a penny-per-ounce tax on sweetened drinks, and Philadelphia Mayor Michael Nutter suggested a 2¢-per-ounce tax . Those would mark the largest taxes on sweetened beverages in the U.S.

-- By Natalie Zmuda

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