Gatorade: A Case Study on How to Confuse Your Customers

From AdAge:

Gatorade is looking to innovate itself out of a sales slump and will spend some $30 million on product and packaging development to do so. The granddaddy of the sports-drink category is pushing forward with plans to introduce "G Series," a grouping of three product categories, while giving another facelift to its core product lines.

As part of the new product introduction, the core Thirst Quencher and G2 lines will also receive another facelift, the second in just over a year. Mr. d'Amore said the new packaging would be "more functional." The redesigned graphics will more prominently feature a low-calorie message for the G2 brand, which will have its calories reduced to 20 per 8-ounce serving, from 25. A spokesman declined to comment on the redesign of the Thirst Quencher products beyond saying that the brand is committed to G, the logo it introduced last year.

Then why change it? Gatorade, as well as its parent company Pepsi, just seems to be floundering around trying any stunt or change that will bring it sales in the short term. Pepsi reminds me of the comic book market in the '90s, when everything suddenly became about foil embossed holographic #0 die-cut covers. Everything was really, really flashy. Image comics was the worst about it. Oh, it sold boatloads of comics at first - until the novelty wore off. Pretty soon things settled back down to regular covers with story-driven issues inside. People were lured by the flash for awhile, but what people want is good, quality storylines and characters to read with their expendible money. And the same can be said of soft drinks. People are more concerned with dependable, consistent quality over the long run than a flash in the pan.

Just focus on the quality of the product, Pepsi, not gimmicks. And please develop a long-term strategy for your products that is built on the actual product rather than fads and marketing slight of hand. You're only confusing, well, everyone. And that leads to lower sales. People like the tried and true, especially in brand names they know and grew up with.

Gatorade has said this year's marketing efforts are on track, but sales and market share both fell in the first half, when the "What Is G?" marketing campaign was most prominent in the marketplace. In the first half of this year, volume dropped 18%, according to Beverage Digest, while market share dipped four points to 75%. Year-to-date volume is down 14% for the brand.

The reason both sales and market share have both fallen is because Gatorade is competing too heavily with itself and watering down the market. Al Ries said it best: "Then there’s Gatorade Tiger, with three flavors. Gatorade A.M. with two flavors. Gatorade Endurance Formula with three flavors. Gatorade Energy Bar with two flavors. Gatorade Nutrition Shake with three flavors. Gatorade Thirst Quencher with seven flavors. And Gatorade G2 with three flavors. Total: 23 flavors or varieties of Gatorade.

23 flavors? That's ridiculous. I'm assuming that includes the Gatorade Rain line. Or have they discontinued that? See what I mean? You can't just say "go get some Gatorade" anymore. It almost takes a college degree to figure out which Gatorade you want. Let me help them out: When I buy Gatorade for cycling, I still buy original Gatorade in either lemon/lime, orange or fruit punch flavors (just for variety). When I was mascotting, it was the same thing. I prefer the taste of Gatorade over Powerade, but I still stuck to those basic three flavors in the original formula. I tried the rain and the dew and the Tiger, but they didn't have the same effect that straight-up Gatorade did. And let me assure you that if there are any athletes out there who know about and value good hydration - it's mascots.

That's it. It's just that simple. Less is more. Wake up, Pepsi, and focus on why people drink your products and less on what will drive sales in the next quarter. Sales are going to slump, especially in a recession. But if you build a brand that people can depend on, the sales will be there for the long haul. Ask Coca-Cola.