Here at BevReview, we’ve had a rather tumultuous history with Pepsi Next.
In late 2010, based on our trademark research as well as information obtained from a few sources, we wrote a story speculating about a new drink called Pepsi Next. Just 5 days later, lawyers representing Pepsi proceeded to serve us with a Cease & Desist order regarding our story.
Among the demands made by Pepsi, they requested the names and contact information of our sources, as well as other site data. It was demanded that we remove all references to our original story, with the threat of lawsuit if we didn’t comply.
I come from a journalism/marketing/Web media background, so protection of sources is a very important issue to me. After consulting with our legal counsel, we proceeded to remove our original Pepsi Next story, but in doing so, also refused to provide any additional information regarding the sourcing of our article. We value the feedback and information we get from BevReview readers; we aim to maintain that trust even if it means losing the big story.
Of course, just a few days later, John Sicher and our friends at Beverage Digest confirmed our hunch, noting that “Pepsi recently concept-tested a product called ‘Pepsi Next,’ said to have 60 calories per can.”
Which brings us to today… and the cans of Pepsi Next sitting on our desk.
While this wasn’t the first time we’ve been legally threatened about our writing (just ask Monster Energy), it’s a little hard to view Pepsi Next objectively. But we’ll give it our best shot!
As noted, Pepsi Next was being tested in 2010 via targeted marketing research groups. The company originally trademarked two names: Pepsi Next (#77283282, filed September 9, 2007, abandoned June 6, 2011) and Diet Pepsi Next (#77268451, filed September 30, 2007, abandoned June 6, 2011). This is much like how they handled Pepsi Max, which was originally named Diet Pepsi Max. It left the company with options on how to best position the drink (as an alternative to full calorie… or yet another diet).
Those research tests must have been successful, because in June 2011 Pepsi announced they were were going to move the product into 2 test markets, Cedar Rapids, IA, and Eau Claire, WI. Pepsi decided to stick with the Pepsi Next name, abandoning their first two test market trademark filings and creating a new one for general sale, also called Pepsi Next (#85222610, filed January 1, 2011). We eventually arrive here in 2012 with Pepsi Next rolling out nationwide this month.
So what exactly is Pepsi Next? And why does it even exist?
Pepsi is pitching Next as a mid-calorie soft drink, targeted at an audience that is looking to cut back on calories, but doesn’t like the taste of diet beverages. If this sounds familiar, it is, because both Pepsi and Coke tried it back in 2004 during the low-carb, Atkins Diet craze. Did we learn nothing from the complete failure of short-lived Coke C2 and Pepsi Edge? What has changed since then that would create a marketplace where Pepsi Next would be welcomed?
I’m not sure much has, other than Pepsi losing the #2 sales spot to Diet Coke (with Coke remaining #1 and Pepsi sliding to #3). Perhaps it’s the increasing popularity of Coca-Cola Zero combined with the stillborn marketing of Pepsi Max (really, a beer bottle shape?). Maybe Dr Pepper Snapple Group’s successful launch of Dr Pepper Ten (with 10 calories) and the expanded testing into other Tens (Sunkist Ten, 7Up Ten, A&W Ten, Canada Dry Ten, and RC Ten) has given Pepsi the confidence to launch Next. Most likely it’s the yearly decline in sales of full-calorie carbonated soft drinks.
Even if Pepsi Next is a successful product based on formulation and taste, can it be successfully marketed? Unlike Coke’s easy-to-understand trilogy of cola beverage lines (Coke, Diet Coke, Coke Zero), Pepsi is far more confusing.
Along with the flagship (sweetened with high fructose corn syrup) and Pepsi Throwback (sweetened with “real sugar”), we have Diet Pepsi (sweetened with aspartame), Pepsi Max (originally branded as Diet Pepsi Max, redesigned a few times, and sweetened with aspartame and acesulfame potassium, with some ginseng thrown in), and long-neglected Pepsi One (sucralose and acesulfame potassium). Then along comes Pepsi Next, which not only has high fructose corn syrup as a sweetener, but also aspartame, acesulfame potassium, and sucralose. Got a headache yet?
Even the taglines are a bit confusing. For example, Pepsi Max argues that it has “Maximum Pepsi Taste” with 0 calories, while Pepsi Next claims “Real Cola Taste” with 60 calories per can.
Finally, there’s the name itself. What does “Next” actually mean? Unlike something like “Zero,” it doesn’t come with its own definition.
No wonder it’s hard to explain the differences with all these drinks! (We haven’t even talked about the taste yet.)
The package design does not help differentiate Pepsi Next from others in the Pepsi lineup. During test marketing, Next showcased a can that was dark blue on the bottom, with different shades of lighter blue panels moving up the can until it was finally white/silver at the top. This created a great visual impression that it tastes like Pepsi, but is lighter.
However, the design that eventually rolled out to market took the standard Pepsi blue can and just made it a lighter shade of blue. And to add a little more brand confusion, they added the Coca-Cola “Wave” in white! Looking at the marketing artwork, this white band is pretty visible.
However, viewing bottles and cans in actual stores, this white band is buried on the back of the label. Who authorized this design? It’s as if someone intentionally wants to confuse customers between Pepsi and Pepsi Next. Let’s not forget that these are the same bozos who thought it was a good idea to launch the first generation of Pepsi Throwback in a blue can that was hard to differentiate on the shelves (thankfully, they fixed that in the 2nd, 3rd, and permanent releases).
Perhaps a simpler selling point would have been to create a product using stevia as part of the blend, maybe like Sprite Green (Pepsi is already using PureVia in various products). At least then it would have been simple to explain. “Pepsi taste. Fewer calories. All natural sweeteners.” Done.
But enough about the history and positioning of this product. While that will go a long way to its success or failure, obviously the taste is rather important. Remember, Pepsi Next is not targeting existing diet soft drink customers. Rather, they are going after patrons of full calorie Pepsi in an attempt to create a new segment to grow, without cannibalizing their existing (shrinking) sales of carbonated soft drinks. Diet Mountain Dew saw positive growth for Pepsi last year, thus it makes sense to keep looking for better low/no-calorie products.
To most accurately compare the taste of Pepsi Next, we assembled bottles of Pepsi, Diet Pepsi, and Pepsi Max to test against, much like we did with our reviews of the “Tens”. Working off the base of regular Pepsi, given that’s the target audience for Next, we compared how Next stacked up against other zero calorie versions of Pepsi.
Personally, I’ve long felt that Pepsi Max is a great product with poor marketing. Not only does it have zero calories and a decent Pepsi taste, but the no-longer-promoted ginseng element is a great differentiator against Coke Zero (remember the 2008 Super Bowl ad?). Thus I was surprised in blind testing to find myself liking Pepsi Next far more than Diet Pepsi and Pepsi Max.
Just like we discovered in our reviews of the “Tens”, the key is the high fructose corn syrup at the front of the drink experience. Pepsi calls this the “taste curve”, specifically regarding when the drink first hits your tongue. Both Diet Pepsi and Pepsi Max taste “diet” upon first hitting your mouth. Pepsi Next starts out with a sweet, more traditional Pepsi flavor, before switching to the often reviled aftertaste associated with artificial sweeteners. When those kick in, it’s far more like Pepsi Max in the flavor experience, with a strong chemical infusion.
Pepsi Next isn’t a magic bullet. It still tastes “diet” in many aspects. But it’s probably the closest non-Pepsi to match the flavor of the original. Granted, if you have issues with lots of artificial sweeteners (and there are 3 used in Next, just like RC Ten and Big Red Zero), then you are still going to have issue with Next.
Should Next succeed, Pepsi seems poised to make it a franchise, if their filings with the US Patent and Trademark Office are any indication. For example, it looks like they already have a flavor extension planned, Pepsi Next Paradise Mango (#85550914, filed February 2, 2012).
And like Dr Pepper Snapple Group, it looks like they’re ready to take the “Next” brand to other properties, such as Mtn Dew Next (#85231611, filed February 2, 2011) and Sierra Mist Next (#85231613, filed February 2, 2011).
Incidentally, a BevReview reader was kind enough to mail us a test can of Pepsi Next used in the initial marketing research phase of this drink’s development from 2011. We compared the taste against what is available today with the official release version. In this case, both drinks tasted the same. I’m sure that other variations were used with target audiences, but it would seem that this particular strain definitely won out among the rest.
Pepsi Next won over test markets, but can this drink win over the general public, as sales of full-calorie soft drinks continue to decline? In my opinion, Pepsi Next is a great tasting mid-calorie version of its namesake. Unfortunately, given Pepsi’s recent track record, it’s predestined to fail due to poor positioning and marketing support. However, I welcome the chance to be proven wrong.
And please don’t sue us!
Carbonated water, high fructose corn syrup, caramel color, natural flavor, phosphoric acid, sodium citrate, caffeine, potassium sorbate (preserves freshness), aspartame, citric acid, acesulfame potassium, sucralose
A 12 oz can contains 60 calories, 60 mg sodium, and 16 g carbs (15 g sugars). A 20 oz bottle contains 100 calories, 100 mg sodium, and 26 g carbs (26 g sugars). Caffeine content is 3.5 mg/oz.