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December 18, 2012

Diet Pepsi quietly changes sweetener

CANDICE CHOI AP Food Industry Writer

NEW YORK — Diet Pepsi is quietly changing its sweetener ahead of a major rebranding of the soft drink set for next month.

The change comes as PepsiCo Inc. looks to reinvigorate its namesake brands after losing market share to Coca-Cola Co. in recent years.

Cans of Diet Pepsi around the country now list a mix of two artificial sweeteners, a pairing that is commonly found in newer diet sodas. Previously, Diet Pepsi used only aspartame, which is sensitive to heat and breaks down more easily.

This summer, PepsiCo had declined to say whether it would go ahead with such a change after reports surfaced that it was testing the new sweeteners. Although the switch is only intended to help prevent the taste from degrading over time, companies are often sensitive to public perceptions that they might be tinkering with major brands. PepsiCo executives likely don’t want to call any attention to the use of artificial sweeteners in the drink either.

When reached for comment Sunday, PepsiCo spokeswoman Andrea Canabal said that Diet Pepsi using the new sweetener mix started hitting shelves in early December. She said the new mix will be more widely available in the coming weeks.

“It’s not like a light switch. It’ll start appearing as shelf space clears,” she said. In January, Canabal said the company is planning a major ad campaign that will include a new logo with a heart and the theme “Love Every Sip.”

The sweetener change will not be explicitly communicated in the ads, which will feature actress Sofia Vergara.

In addition to aspartame, cans of Diet Pepsi found in New York, Omaha, Neb., and the Bay Area now list acesulfame potassium as an ingredient. The ingredient is often used in combination with other artificial sweeteners and can be found in a wide range of foods including baked goods, chewing gum and gelatin desserts.

John Sicher, editor and publisher of the industry tracker Beverage Digest, said the synergistic effect of mixing the two sweeteners is intended to help keep the drink’s sweetening power at a constant level, making it taste fresh longer.

“A change in sweetener does not change the flavor,” he noted.

PepsiCo said in a statement Sunday that it was adding a “very small amount” of acesulfame potassium “to ensure consistency with every sip.” The sweeteners used in Diet Pepsi vary depending on the region of the world.

The move to improve Diet Pepsi comes amid a broader push by PepsiCo to boost sales of its flagship soda. Under pressure from investors, CEO Indra Nooyi earlier this year announced the company would step up investment in its flagship brands.

Already this year, PepsiCo has made several splashy moves including a wide-ranging partnership with singer Beyonce and a multiyear deal with the National Football League to sponsor the Super Bowl halftime show. TV ads for Pepsi have also featured singer Nicki Minaj, New Orleans Saints quarterback Drew Brees, the boy band One Direction and international soccer stars including Lionel Messi.

Whether the efforts will pay off with increased sales remains to be seen. In the latest quarter, PepsiCo said its soda volume in North America fell 2 percent, reflecting the broader decline in soft drink consumption that has plagued the industry since 1998. But the company noted that its share of the market had improved.

For now, Diet Pepsi remains the No. 7 carbonated soft drink with 4.9 percent of the market, according to Beverage Digest. That’s down from 5.3 percent in 2000. Meanwhile, Diet Coke’s share has increased in that time from 8.7 percent to 9.6 percent. Diet Coke, which still only uses aspartame, overtook regular Pepsi to become the No. 2 soda brand in 2010.

Coke remains No. 1 and Pepsi is No. 3.

Still, Diet Pepsi rakes in roughly $5 billion in a year in revenue and remains one of PepsiCo’s biggest moneymakers. The company, based in Purchase, N.Y., also makes Frito-Lay snacks, Tropicana juices and Quaker oatmeal.

It’s not the first time a soda company is tweaking the sweeteners in its drinks; PepsiCo made a similar move with Diet Mountain Dew in 2006, while Coca-Cola did the same with Diet Sprite in 2000.

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