Coke, Pepsi Diverge Toward Same Goal: Tasty Mid-Calorie Sodas


If Coca-Cola and Cargill aren’t on the horn already, they should be. Coke is staking the future of calorie-reduced soft drinks on stevia, and ingredient giant Cargill is staking its future in that segment on stevia-based ingredient systems.

Meanwhile, PepsiCo is approaching the future of calorie reduction in soda from a different direction. CEO Indra Nooyi recently pooh-poohed the long-term usefulness of stevia, so her company reportedly has steered toward an intriguing alternative: a new chemical called S617 that cuts the amount of sugar and high-fructose corn syrup required in beverages to obtain the same sweet taste.

One thing is for sure: Both soft-drink giants have to do something. US soda consumption last year declined by 1.2 percent, which brought the category back down to 1996 levels, according to Beverage Digest. And even diet-soda consumption has begun to hit the skids as American consumers appear increasingly concerned about artifical sweeteners and are turning away from soft drinks to alternative beverages as a whole.[more]

“Getting new sweetener technology appears to be absolutely critical,” John Sicher, editor of Beverage Digest, told Advertising Age. “Whether these companies can get natural sweeteners that bring the calories way down and preserve good taste is really going to be what people are looking for over the next year or two.”

Coke has been experimenting with stevia—a natural extract of a South American bush—in mid-calorie sodas such as Coca-Cola Life, which was launched in Argentina last summer, and in its Sprite Select and Fanta Select line extensions in the US. Overall since 2008, Coca-Cola has introduced more than 45 products sweetened with stevia in 15 countries, according to AdAge. In Europe, Sprite and Nestle’s Nestea brands are among the biggest brands to use stevia, slashing sugar content by 30 percent, reported.

Cargill probably would like to see Coke do more with stevia. The commodities giant fields its own stevia brand, Truvia, for tabletop applications. But at the FIE food show in Frankfurt last month, Cargill introduced a stevia-based sweetening system that it said can help companies reduce sugar in soft drinks by up to half, according to, and without any of the bitter or licorice-like aftertaste associated with earlier stevia extracts. The two companies already are used to working with each other on better-for-you ingredients via a decade-old partnership in which Cargill supplies heart-healthy CoroWise plant sterols for a SKU of Coke’s Minute Maid orange juice.

Nooyi earlier this year down-played the long-term potential of stevia in a diss heard ’round the beverage world. That’s probably one reason PepsiCo is reported to be working so closely with a San Diego-based biotech firm, Senomyx, which is in the late stages of developing a “taste modifier” that would essentially fool taste buds into thinking they’re getting more sugar than delivered, according to Advertising Age. Neither company has explicitly acknowledged theyr’e working together on this, but the publication pointed out that Senomyx has a four-year, $30 million development deal that it struck with PepsiCo in 2010.

Besides, in an October earnings call, Nooyi told investors and media that the company was “staying on the path of innovating along natural sweeteners and thinking about flavoring agents to make sugar taste more sugary.”

And there might be a rub: No one is calling S617 “natural.” Diet-soda consumers increasingly have expressed concerns about common artificial sweeteners including aspartame. And sucralose manufacturer Tate & Lyle has just felt compelled to reassure consumers that its ingredient is safe following publication of a review alleging that the high-intensity sweetener is “not biologically inert” and that more research is required on its post-ingestion effects.

While S617 technically isn’t a sweetener, it certainly isn’t eligible to reassure PepsiCo of having a “clean label” on its sodas that is of increasing concern to American and other consumers. “Beverages innovations perceived as being made in a laboratory,” Euromonitor International beverage analyst Jonas Feliciano told AdAge, “carry a stigma that may prove difficult when attempting to lure back lost customers.”


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