Doritos leading PepsiCo’s charge into food service

by Jeff Gelski
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7-Eleven begins offering Doritos Loaded.

PURCHASE, N.Y. – The Doritos brand already has tie-ins with Taco Bell and 7-Eleven, and more food service combinations may follow.

“I think more and more food service customers are coming to us and saying, ‘What can you do for us to drive traffic and to drive ticket?’ “ said Indra Nooyi, chairman and chief executive officer of PepsiCo, Inc., in a July 23 earnings call to discuss second-quarter results. “So it doesn’t matter if somebody comes in to buy a product from C-store, can they also be attracted to stop by the food service side and pick up something for immediate consumption.”

Taco Bell offers the Doritos Locos Taco on its menu. On July 2, Doritos Loaded launched exclusively at more than 5,500 7-Eleven stores nationwide.

“Doritos Loaded is a delicious hot snack filed with melted nacho cheese and encrusted with Doritos,” Ms. Nooyi said. “Our launch of Loaded created a great deal of traditional and social media buzz, generating more than 750 million impressions to date, and was also featured on (TV show) ‘Jimmy Kimmel Live.’ ”

The Doritos brand belongs to the Frito-Lay North America (F.L.N.A.) unit of Purchase-based PepsiCo. Operating profit for F.L.N.A. increased 3% to $937 million in the second quarter ended June 14, which compared to $906 million in the previous year’s second quarter. Net revenues for F.L.N.A. increased 2% to $3,387 million from $3,332 million.

Operating profit for Quaker Foods North America, another unit of PepsiCo, increased 4% in the second quarter to $139 million, which compared to $133 million in the previous year’s second quarter. Net revenues in the second quarter for Q.F.N.A. declined 2% to $564 million from $577 million.

“Despite continued challenges across most central store food categories, we gained value share at retail in each of Quaker’s key categories: hot cereal, ready-to-eat cereal and snack bars, both in the quarter and year to date,” Ms. Nooyi said.
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