After a couple years differentiating itself focusing on the lifestyle space, Pepsi is re-launching Propel water under the Gatorade hydration portfolio. From AdAge, Natalie Zmuda shares that the enhanced water brand will update its product packaging, remove the “zero” from its product name, and position itself as a hydration beverage for regular exercisers (article link here). Unlike Gatorade, which is targeting the serious athletes and is a sports drink, Propel helps fulfill an athlete’s need with water – not an isotonic. Still, the question remains how effective can Propel compete within the crowded enhanced waters space? And given all the changes to the Propel franchise, how will consumers perceive Propel after another restage?
With popular brands like glaceau vitaminwater, glaceau smartwater, and SoBe Lifewater in leading market positions, Propel still manages to control a 13% market share. It has remained competitive as a result of the brand’s equity and the consumer’s affinity with the hydration beverage. The franchise will look to strengthen its market position by catering toward “routine exercisers” and piggy-backing on the Gatorade name. Their updated packaging will feature the line “from the makers of Gatorade” to drive awareness and availability. This point is critical to Propel’s growth, as owning a part of the consumer’s mind becomes increasingly important with the enhanced waters market expanding to include with more brands in recent years. Even Pepsi themselves has plans on introducing a premium water brand – Qua – within the year. (article link here). The competition within this segment is fierce, and owning a particular segment – the casual athletic segment – helps Propel stake its claim in enhanced waters. With Gatorade also catering to the athletic segment, it would not be surprising to see more promotional efforts where Propel and Gatorade products complement one another.
The issue surrounding product perception could have been a tougher obstacle to overcome. Propel was originally introduced under the Gatorade before moving away from the athletic consumer in 2011. As consumers and their drinking habits evolved, the Propel brand followed the moving target to become more of a lifestyle water brand. Instead of continuing to target males/females 25 and above, their core target demographic moved up to Boomers and Generation X. Measured media spend to celebrate the new positioning was over $10 million. Three years following this direction, Propel is changing their focus and advertising message. Again. If not for leveraging the Gatorade brand name, Propel may have a tougher time connecting to younger consumer segments after structuring the communication toward a difference audience. With the sports drink’s backing, Propel has a stronger platform to broadcast their marketing message toward athletes and exercisers.
Regardless of the marketing message and target demographic, the product fits into the changing needs of consumers. Propel is well-received as evidenced by their market position. With the support of Gatorade, Propel’s path on the road to success becomes much less challenging.