If Coca-Cola Co. has its way, winning college sports coaches will be doused with Powerade rather than Gatorade.
(Bloomberg) — If Coca-Cola Co. has its way, winning college sports coaches will be doused with Powerade rather than Gatorade.
The beverage giant is using the new NCAA rules that allow college athletes to earn money as product endorsers in an effort to unseat the long-dominant player in sports drinks, PepsiCo Inc.’s Gatorade.
Federico Muyshondt, chief executive officer of Coca-Cola’s Bodyarmor business, said that the brand has partnered with 24 college football programs to take advantage of the NCAA rule adopted in 2021, allowing student athletes to earn money from so-called NIL deals, or the marketing of their name, image and likeness.
Muyshondt also leads the company’s Powerade brand, which is signing deals with college athletes and started the current football season with endorsement deals with five standout players, including Florida State’s defensive end Jared Verse, the University of Georgia cornerback Malaki Starks, and University of Southern California wide receiver Mario Williams.
“Our ambition is to use these two brands together to become number one,” said Muyshondt. “We’re taking on one of the biggest brands in consumer products,” referring to Gatorade, the category leader and first-ever sports drink. “It’s a brand that once had 100% market share.”
PepsiCo declined to comment.
As college sports moves into the basketball season and the highly anticipated March Madness tournament, more Powerade deals with athletes will be announced, according to Muyshondt. “Athlete partners are a big part of our brand,” he said.
Under One Roof
Coca-Cola acquired the 85% of Bodyarmor that it didn’t already own in November 2021 for $5.6 billion. Powerade, the Coca-Cola brand that has long been a distant second to Gatorade, was then placed under the management of Bodyarmor’s leadership.
The lower-priced Powerade is designed for what the company calls “point of sweat,” or those consumers seeking a beverage during their athletic activity. Bodyarmor is more premium priced, targeting a broader category of health and wellness, and aimed at those willing to pay for natural ingredients.
“We truly believe both brands can seamlessly co-exist under one roof,” Muyshondt said, noting that there is currently a 7% overlap in consumers of both Powerade and Bodyarmor. “We see Bodyarmor and Powerade complementing each other rather than competing against each other.”
Coca-Cola CEO James Quincey admitted to analysts earlier this year that the company has struggled to integrate Bodyarmor into its operations. The BodyArmor acquisition was the largest ever for the Atlanta-based soft drink maker. And now, with Muyshondt at the helm and Powerade and BodyArmor combined under the same management, more innovation and global expansion are in the works, said Muyshondt, who was appointed to his role in April 2022 following a senior executive role at the yogurt maker Chobani.
In June, Bodyarmor announced that it was entering the growing “rapid rehydration” category with Bodyarmor Flash I.V., and earlier this week introduced the product in a powder form. Bodyarmor expects sales of hydration enhancers to increase by double digits and total $1 billion in sales this year.
Created in 1965 for athletes at the University of Florida — where the official mascot is an alligator, or gator — Gatorade has dominated the sidelines of most college sports teams for decades. Many a coach has bathed in the sticky glory of having Gatorade ceremoniously dumped on their head following a victory.
Bodyarmor is one of many brands vying for attention in the increasingly crowded energy and hydration categories. Prime, the hydration brand of YouTubers Logan Paul and KSI, earlier this year signed a multiyear sponsorship deal with Ultimate Fighting Championship, which had been sponsored by Bodyarmor. And the Philadelphia Eagles quarterback Jalen Hurts recently agreed to promote A Shoc beverages’ Accelerator brand, an energy drink backed by Keurig Dr Pepper Inc.
Founded in 2011, Bodyarmor grew rapidly with a major assist from the late basketball legend Kobe Bryant, who was the brand’s celebrity face before his death in 2020. Bryant invested $6 million in Bodyarmor during the brand’s early years, and in return his estate reportedly received $400 million when the brand was sold to Coca-Cola.
“Kobe Bryant was an innovator, on and off the court,” Muyshondt said. “He changed the view of celebrities wanting to be in the consumer-packaged-goods business.” Referring to Bryant by his nickname, he said, “The Mamba mentality lives in everything that we do.”
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