PepsiCo's Nooyi: Consumers as confused as ever

by Eric Schroeder
Share This:
Search for similar articles by keyword: [PepsiCo]
Indra Nooyi, c.e.o. of PepsiCo, said the company is taking a closer look at how it defines portfolio 'buckets.'

PURCHASE, N.Y. — More than a decade ago PepsiCo began sorting its portfolio into three buckets: fun-for-you, better-for-you and good-for-you. Today, the food and beverage maker finds itself still working to fill those buckets in a manner consistent with consumer needs. It hasn’t been an easy task, said Indra Nooyi, chief executive officer of PepsiCo.

“We have never seen the consumer as confused as they are today,” Ms. Nooyi said during an April 23 conference call with analysts to discuss first-quarter financial results. “And I use the word ‘confused’ in a neutral way, not a negative way. If you had asked me a few years ago, people were moving to diet sodas. Now, they view real sugar as good-for-you. They are willing to go to organic non-G.M.O. products even if it has high salt, high sugar, high fat.”

PepsiCo defines its ‘fun-for-you’ portfolio as those products that are part of PepsiCo’s core food and beverage businesses, such as Doritos, Cheetos and Mountain Dew.

“Better-for-you” products are those foods and beverages that have levels of total fat, saturated fat, sodium and/or added sugar that are in line with global dietary intake recommendations. Products in this category included Baked! Lays and Propel Zero.

The “good-for-you” portfolio are those products that deliver positive nutrition through the inclusion of whole grains, fruits, vegetables, low-fat dairy, nuts and seeds or significant amounts of important nutrients. Products in this grouping include Quaker instant oatmeal and Naked Juice.

Ms. Nooyi said PepsiCo is being challenged to really think about what is the definition of “good-for-you” from a consumer perspective.

“This is unprecedented, and the old definition of ‘good-for-you’ is being challenged right now,” she said. “I think the best way to think about this is to think about the fruit and vegetable corridor, a protein corridor, a grains corridor and then sort of a predominantly carb corridor. And then within that, just vary our strategy based on what the consumer is thinking about, because especially millennials today have very different definitions of ‘good-for-you’ versus ‘fun-for-you.’”

The good news, Ms. Nooyi said, is that PepsiCo maintains a balanced portfolio and can flex to either definition of “good-for-you.”

“We are managing the business by watching both,” she said.
Comment on this Article
We welcome your thoughtful comments. Please comply with our Community rules.

 

 


The views expressed in the comments section of Baking Business News do not reflect those of Baking Business News or its parent company, Sosland Publishing Co., Kansas City, Mo. Concern regarding a specific comment may be registered with the Editor by clicking the Report Abuse link.