By Published on .

Most Popular
For nearly a decade, Geoffrey Woolford has spent much of his time at the office sipping soda.

As VP-worldwide of Pepsi-Cola Co.'s research and development, Mr. Woolford's job has consisted of testing various blends of artificial sweeteners. His mission: to formulate a better tasting diet cola.

Countless sips later, he thinks he's finally found the right mix.

This month, the nation's second-largest soft-drink marketer kicks off what it calls its most ambitious marketing effort: the launch of Pepsi One.

"It's the most regular tasting diet product on the market," said Mr. Woolford, with just a hint of bravado.


The $80 million to $100 million marketing budget for the launch of Pepsi One-whose ingredients include a new type of artificial sweetener recently approved by the Food & Drug Administration-is the marketer's first national new-product introduction in six years. In 1992, the company rolled out Crystal Pepsi, only to roll back production some years later.

Company executives are hoping for sweeter success with Pepsi One. The launch heralds the first major product effort for Phil Marineau, president-CEO of Pepsi-Cola North America, who joined the beverage giant about a year ago from Quaker Oats Co. It's also a chance for the company to shake up sales in the moribund diet cola category.

As part of its marketing blitz, the company will tour the country's shopping malls this fall, setting up Pepsi One "lounges"-

inflatable couches with plastic carpeting-for random taste tests.


It also has produced some 11,000 end-cap displays for supermarket aisles and created snazzy stand-up displays for twelve-packs to spark impulse purchases.

Most recently, it secured Oscar-winning actor Cuba Gooding Jr. as pitchman for an ad campaign currently in production at agency BBDO Worldwide, New York.

The ads will make their debut this month during the first game of the World Series.

The tagline: "Only One has it all."

The ad campaign will start with four 30-second spots. One will show Mr. Gooding on a plane with parachute jumpers, another will show him with the head of a high-tech start-up company, said Jeff Mordos, exec VP-managing director, BBDO.

Steven Fund, director of marketing at Pepsi-Cola, said the TV networks will be saturated with Pepsi One commercials the week of Nov. 2.

The company also is considering a joint marketing program with sister company Frito-Lay's Wow! potato chips, made with a fat substitute. Wow! itself has been struggling to gain a foothold.

The new soft drink is targeted to consumers who shy away from the word diet. Pepsi One blends acesulfame potassium, known as Ace-K, and aspartame, the sweetener currently used in Diet Pepsi and in Coca-Cola Co.'s Diet Coke.


Since July-when Ace-K won long-awaited approval from the FDA-the company has worked at lightning speed to bring Pepsi One to market.

It is a mark of Mr. Marineau's aggressiveness, observers said, that the company announced the launch of Pepsi One just hours after the sweetener was approved. Coca-Cola has not yet announced any similar products.

"Coke will sit on the sidelines for a while to see if we blow the doors off this thing," Mr. Fund predicted.

A Coca-Cola spokesman said the company is working on "new initiatives" for Diet Coke and likely will be launching something next year.

Pepsi One, as a brand distinct from Diet Pepsi, is a crucial weapon in Pepsi-Cola's stepped-up battle against perennial rival Coca-Cola Co.


Diet colas have lost market share in the $54 billion U.S. carbonated soft-drink business every year since 1991, and were at their lowest point since 1986 last year, commanding an 18% market share, according to industry newsletter Beverage Digest.

Last year, Diet Coke commanded 8.5% of the market, while Diet Pepsi had a 5.5% share.

The new sweetener will stir up sales of diet beverages, which have been hampered from growth by a lack of sugar-substitute alternatives to aspartame and saccharine, said Gary Hemphill, VP-information services, Beverage Marketing Corp., an industry consultancy.

"A segment of the population continues to resist 100% aspartame-formulated soft drinks," he said. "I think [Pepsi One] potentially could pull more people to the diet category. Right now, no company is getting fat off diet sales."


Diet Pepsi will get its own push early next year with increased ad spending and new TV commercials. Its "Is this diet?" tagline and its formula will be retained, Mr. Fund said.

He said sales are up about 3% so far this year for Diet Pepsi, which has been backed by increased ad spending. Last year the company spent $19.7 in measured media for the brand, according to Competitive Media Reporting.

"There is certainly a loyal Diet Pepsi following," Mr. Hemphill said. "It made sense for them not to touch that brand."

In this article: