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What’s the future of fizzy? PepsiCo to purchase SodaStream in 2019

A deal struck by former CEO Indra Nooyi to make the planet “healthier”

“Every five or seven years, you've got to change out the approach to the brand,” Indra Nooyi, PepsiCo
 

Tapping into tap water

Each year Israeli company SodaStream provides 1.5 billion litres of homemade sparkling water to millions of homes globally, making it one of the largest beverage companies in the world.

The company has been enabling consumers to carbonate water in their own homes since 1903, but its success skyrocketed in recent years through innovation, with an intellectual property portfolio that includes 65 patents and 198 trademark registrations worldwide.

It seems we love the convenience and taste of homemade fizzy water, so it’s not surprising PepsiCo, the world’s fourth largest food and beverage company, has been taking notice.

Before she stepped down in October, PepsiCo’s hugely successful former CEO Indra Nooyi set in train the acquisition of SodaStream, with the deal expected to be finalised in January 2019.
 

Strange bedfellows, or inspired match?

In a statement released in August, Indra Nooyi called PepsiCo and SodaStream “an inspired match."

“(SodaStream) offers consumers the ability to make great-tasting beverages while reducing the amount of waste generated,” Indra’s statement read.

“That focus is well-aligned with Performance with Purpose, our philosophy of making more nutritious products while limiting our environmental footprint. Together, we can advance our shared vision of a healthier, more-sustainable planet."
 

Healthy profits

This move towards nutritious products is paying dividends for PepsiCo. With Indra Nooyi at the helm, who, until she stepped down, was one of only 25 women CEOs leading Fortune 500 companies, PepsiCo almost doubled sales growth.   

Its purchase of SodaStream for $3.2bn is a major win in its battle against chief rival Coca-Cola for an edge in the health-conscious beverage market, according to The Guardian.

Indra Nooyi is highly regarded for picking winners.  
 

Fizzy flavoureds finding fewer fans

According to MBA Rendezvous, Nooyi’s superb knack of facts and figures led her to predict the slowdown in the popularity of aerated soft drinks in the markets worldwide. She meticulously planned for the foray of Pepsi into the sport drinks market in association with Gatorade.

The group also launched a "Refresh Everything" campaign, featuring Pepsi Natural, made with all-natural ingredients, and Pepsi and Mountain Dew Throwback, inspired by designs of the 1960s and '70s.  

The reinvigoration of the PepsiCo beverage sector falls under Performance with Purpose, an umbrella term for a complete transformation of the portfolio of brands, launched by Indra Nooyi when she became CEO 12 years ago.
 

A healthier approach

PepsiCo says its offering of healthier options is a move in tandem with making its food system more sustainable and communities more prosperous.

In a statement on PepsiCo.com, Indra Nooyi said Performance with Purpose was about the character of the company.

“What began as an aspiration to create a good company—good ethically and good commercially—is yielding a more lasting impact than we ever could have imagined.”
 

A regular boost of energy needed

According to MBA Rendezvous, Nooyi has said “Brands go through ups and downs. I think every five or seven years, you've got to change out the approach to the brand, because you need a new boost of energy to think about the next iteration. Too many brands, when they are successful, just become arrogant and get trapped in their very self confidence.”

As Ramon Laguarta, CEO-Elect and President, said in the PepsiCo statement in August.  "PepsiCo is finding new ways to reach consumers beyond the bottle, and today's announcement (of the acquisition of SodaStream) is fully in line with that strategy."
 

An Evening with Indra Nooyi, an exclusive dinner event for executives hosted by The Growth Faculty is on sale now. For more information, ticketing prices and event details, CLICK HERE

 

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