Pepsi's 'Smart Spot' enjoys strong growth

If there were ever any doubts among PepsiCo management regarding its policy shift from some of the company?s traditional offerings toward healthier products, they have surely been banished by 2004 figures highlighting the success of its healthiest items.

PepsiCo now earns about 40 per cent of US sales from products that bear its Smart Spot ?better nutrition? mark. Less healthy foods, what PepsiCo calls ?fun for you? snacks, make up the other 60 per cent of its sales. Smart Spot revenue grew by 13 per cent this year, while ?fun for you? snacks grew by only four per cent.

?Our commitment to health and wellness has never been stronger,? said Steve Reinemund, PepsiCo?s chairman and chief executive, who noted ?healthier products are a key growth area and a global opportunity.?

Launched in June 2004, the Smart Spot scheme now boasts more than 250 PepsiCo products ranging from juices, sports drinks, bottled water, soft drinks, breakfast cereals, oatmeal products, crisps and pretzels, rice cakes and snack bars. Mainstream brands such as Tropicana and Gatorade carry the symbol, as do smaller brands like Near East Original Couscous and a host of crisps under the Baked! umbrella.

To attain Smart Spot status, PepsiCo said its products must meet nutrition and benefit standards based on Food and Drug Administration and National Academy of Sciences guidelines, although some critics have questioned whether the Smart Spot criteria is stringent enough. Others have noted the health focus should make PepsiCo less of a target for obesity lawsuits and position the company for growth.

PepsiCo?s Smart Spot products must: contain at least 10 per cent of the daily value of a targeted nutrient (ie, protein, fibre, calcium, iron, vitamin A, vitamin C) and meet limits for fat, saturated fat, trans fat, cholesterol, sodium and added sugar; or be formulated to have specific health or wellness benefits; or have reduced calories or nutrients such as fat, sodium or sugar.

PepsiCo is also targeting black and Latin American consumers through a healthy lifestyles programme called ?Perfect Storm,? which will involve sponsoring ethnic sports and fitness organisations and encouraging preparation of low-calorie meals.

The Smart Spot scheme also operates in Canada.

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