By Martinne Geller
June 26 Coca-Cola Co announced plans on
Wednesday to introduce a cola that is sweetened with sugar and
the naturally occurring, no-calorie sweetener stevia, the latest
move in the high-stakes race to turn around the soda industry.
Coca-Cola Life will have about half the calories of regular
Coke. It will go on sale this week in Argentina, where Coca-Cola
has 50 percent of the soda market, compared with PepsiCo Inc's
16 percent, according to industry newsletter Beverage
Digest, which was first to report the news.
The world's largest soda company has used stevia in 45
products, such as Vitaminwater Zero and Fanta Select, but never
in its flagship cola.
There is no date for introducing the product elsewhere.
Company executives at a news conference in Buenos Aires likened
the launch with the 2005 debut of Coca-Cola Zero, which was
first introduced in Australia and later sold elsewhere.
DOSE OF SKEPTICISM
Consumer Edge Research analyst Bill Pecoriello said a global
roll out seemed likely because it would also preempt PepsiCo's
"A healthy dose of skepticism as to the long-term success
potential is warranted, given past introductions," he added.
There has been a recent wave of mid-calorie sodas such as
Pepsi Next and Dr Pepper 10, but they have not maintained market
share, Pecoriello said.
Coke and Pepsi have been using stevia, a plant native to
Paraguay, in drinks for years, but mostly in noncarbonated,
fruit-flavored drinks. As recently as last month, PepsiCo CEO
Indra Nooyi said stevia did not work well in colas, even though
Pepsi Next in Australia uses stevia. Pepsi Next in other
markets, including the United States, uses a mix of
high-fructose corn syrup and artificial sweeteners.
Nooyi told a conference hosted by Bernstein Research in May
that a breakthrough in sweetener technology could help reverse
the decline in sodas in the United States and that it needed to
occur sooner rather than later.
"If you let this go too long, another three or five years,
the consumer will walk away from (carbonated soft drinks)," she
said at the conference. "But if we can address the barriers to
consumption, we can actually bring back the lapsed users."
Regarding its own innovation, PepsiCo said in February that
preparation was underway for the review and commercialization
of a new "beverage innovation project," but it had not yet been
submitted to U.S. regulators for review.
On Wednesday, a spokeswoman said PepsiCo was "working to
identify sweetener and flavor options that can help us provide
more reduced or zero-calorie beverage choices."
Coca-Cola shares closed up 1.5 percent at $40.33 on the New
York Stock Exchange. PepsiCo stock was up 1.6 percent at $81.30,
while Dr Pepper Snapple Group Inc rose 1.5 percent to
end the day at $45.64.