PackStratSample January 31, 2011 : Page 1

LE B R T I A N G f y e a r s o Unbiased global packaging intelligence and analysis In the Drink Global soft drink, beer, and dairy packaging, 2010 THE PRIME OF THE GATORADE POUCH Is it the prime of the liquid pouch, or just the prime of a novelty sports drink? The market is about to decide. In Feb. 2010, Gatorade launched a new series of sports-performance drinks that included the heavily marketed Gatorade Prime , a 4oz pouch of gel-like liquid designed as “pre-game fuel” taken directly before exercise. The pouch itself has become an immediate sensation beyond that of just serious athletes looking for a quick boost: It now vigorously competes with Coca-Cola’s Powerade and other bottled sports drinks. For Pepsico ’s Gatorade, the ascent came with perfect timing. The company, still the largest-selling sports drink in the United States, had been losing share to rivals. But for the pouch, the uplift offers more than a sports-drink feel-good story – it brings new hope. For one, Gatorade Prime was the first large-scale scale introduction of a pouch beverage since Capri Sun long ago, said consultant Daniel Beard of Packaging Specialists . For another, it offers a pouch filled on form, fill, seal equipment, potentially tially ushering in the beginning of a pouch revolution, n, he said. Compared to premade pouches, form, fill and seal is a bit more expensive. But it offers brand owners control over production, since the package Gatorade’s is made in-line. It also can Prime pouch h e is one of the lead to higher filling speeds le largest-scale that can be off the charts for introductions s of pouches – as much as 2,000 a new beverage age pouches a minute for dry package products, according to Beard. exclusively in a “Gatorade stepped off the t. pouch format. cliff with this,” he said. And now, with the company investing heavily in the pouch for its momentum-builder in sports drinks, it may be time for other liquids to follow. Packaging Strategies’ Perspective: The truth is that since Capri Sun, pouches have not made the predicted inroads in the drinks category. There have been a few attempts, such as that by Coca-Cola’s Hi-C, but nothing that has been a market leader. Could bottles and cans finally face some spirited competition? P S 34% -PET bottles 17% -Glass bottles 11% -Cartons 10% -Cans 6% -Sachets 5% -HDPE bottles 17% -Other Source: Canadean IN THIS ISSUE Gatorade shower ........................................ 1 2nd Opinion : Supply chain expectations ................................................. 2 Overseas trips ............................................. 3 Material upswing ......................................... 4 Resistant to tear ...................................... 4-5 New generation in recycling .................... 5 Showing its metal ....................................... 6 The wireless soup ....................................6-7 Peelling off tuna ........................................... 7 Street Talk ..................................................... 8 Pre-conference Coverage The global survey Connecting packaging to consumers Unauthorized reproduction in whole or in part prohibited without permission of publisher e x c ellen c e Volume 29, No. 2 January 31, 2011 C E

Gatorade Shower

Is it the prime of the liquid pouch, or just the prime of a novelty sports drink?The market is about to decide.<br /> <br /> In Feb. 2010, Gatorade launched a new series of sports-performance drinks that included the heavily marketed Gatorade Prime, a 4oz pouch of gel-like liquid designed as “pre-game fuel” taken directly before exercise. The pouch itself has become an immediate sensation beyond that of just serious athletes looking for a quick boost: It now vigorously competes with Coca-Cola’s Powerade and other bottled sports drinks.<br /> <br /> For Pepsico’s Gatorade, the ascent came with perfect timing. The company, still the largest-selling sports drink in the United States, had been losing share to rivals. But for the pouch, the uplift offers more than a sports-drink feel-good story – it brings new hope.<br /> <br /> For one, Gatorade Prime was the first large-scale introduction of a pouch beverage since Capri Sun long ago, said consultant Daniel Beard of Packaging Specialists. For another, it offers a pouch filled on form, fill, seal equipment, potentially ushering in the beginning of a pouch revolution, he said.<br /> <br /> Compared to premade pouches, form, fill and seal is a bit more expensive. But it offers brand owners control over production, since the package is made in-line. It also can lead to higher filling speeds that can be off the charts for pouches – as much as 2,000 pouches a minute for dry products, according to Beard.<br /> <br /> “Gatorade stepped off the cliff with this,” he said. And now, with the company investing heavily in the pouch for its momentum-builder in sports drinks, it may be time for other liquids to follow.Packaging Strategies’ Perspective: The truth is that since Capri Sun, pouches have not made the predicted inroads in the drinks category. There have been a few attempts, such as that by Coca- Cola’s Hi-C, but nothing that has been a market leader. Could bottles and cans finally face some spirited competition?

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