PepsiCo Sees Sugarless Gatorade Refreshing Sports-Drink Demand

PepsiCo Inc. is introducing a zero-sugar version of Gatorade to woo consumers back to the sports-drink category.

The new product further expands the Gatorade portfolio, joining organic and low-sugar versions of the beverage, as PepsiCo works to please consumers who have increasingly migrated away from sugar-laden beverages.

The shift in preferences represents a challenge for brands that rely on sweeteners. Gatorade, which accounts for more than 70 percent of the sports drinks market, is facing pressure from new competitors like coconut water, which boast simpler ingredients. Measured retail sales of sports drinks fell 3.2 percent by volume in 2017, according to Beverage-Digest, a trade publication, which first reported the news on Wednesday.

While the overall category declined, sports drinks without sugar fared better. Gatorade and Powerade, made by PepsiCo rival Coca-Cola Co., both lost volume in 2017, as Powerade Zero grew, according to Beverage-Digest.

‘G Zero,’ as the new Gatorade is called, is the first no-sugar product introduced in Gatorade’s 53-year history. The drink is slated hit shelves across the U.S. in June. The initial flavors include Lemon-Lime, Orange and Glacier Cherry.