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Pepsi is desperately trying to prevent Mountain Dew from becoming the latest victim of people's growing hatred of sugary sodas

Kate Taylor , Business Insider US
 Oct 04, 2019, 04:46 PM
PepsiCo is working to improve Mountain Dew sales.
Photo by Dannie Walls/Icon Sportswire via Getty Images
  • PepsiCo is working to improve Mountain Dew sales, as customers ditch sugary sodas.
  • "Mountain Dew is improving, but it's not to the levels that we would like to see," CEO Ramon Laguarta said in a call with investors on Thursday.
  • Pepsi is trying to boost sales by tapping into the energy drink market with drinks like Mountain Dew Game Fuel - an energy drink aimed at gamers - and other variations, such as Mountain Dew Zero Sugar.
  • For more stories go to www.BusinessInsider.co.za.

As America ditches sugary sodas, PepsiCo is trying to prevent Mountain Dew from becoming a victim of changing tastes.

"Mountain Dew is improving, but it's not to the levels that we would like to see," CEO Ramon Laguarta said in a call with investors on Thursday.

Laguarta said Mountain Dew sales are flat, describing the brand as a "pending subject" and a "focus of the organisation." More generally, PepsiCo's North American beverage category saw organic revenue growth of 3% in the most recent quarter.

"I think the brand is well resourced," Laguarta said on Thursday. "It's going to be down to having the right ideas and executing the ideas with quality."

Laguarta said that Mountain Dew is at the intersection of carbonated soft drinks and energy drinks. And, while soda sales have been slipping, energy drinks are booming.

On Monday, Coca-Cola announced it is rolling out Coca-Cola Energy, the first energy drink under the Coca-Cola brand, in the US in January 2020. Dollar sales of energy drinks increased 11.2% in the 52 weeks ending September 24, growing from $11 billion (R166 billion) to $12.2 billion (R184 billion), according to Nielsen data.

PepsiCo is attempting to tap into this growing category with new types of Mountain Dew that might shake the drink's sugary, soda-centric reputation.

In July, Laguarta told investors that sales of Mountain Dew Kickstart - a brand that combines juice, caffeine, and soda meant to be drunk in the morning - were starting to grow again. Earlier this year, PepsiCo launched Mountain Dew Game Fuel, an energy drink aimed at gamers. The company had previously sold limited runs of a soda called Mountain Dew Game Fuel, but this latest version of the drink will be a permanent addition to the lineup.

"We're investing in the core Dew consumer, very loyal, giving them their preferred product in non-sugar and sugar options, innovating in flavours in Dew and then moving Dew slowly into other spaces where we think the brand has a role to play," Laguarta said in July.

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