Gatorade has long been the leader among sports drinks, those brightly colored beverages designed to replenish the electrolytes lost when you sweat. Now, its rival Powerade is hoping that a revamped recipe and new look will help finally unseat Gatorade from the top spot. That won’t be easy.
The new Powerade, which is currently replacing the old version, boasts about twice as many electrolytes as its previous iteration but also, it claims, as Gatorade’s Thirst Quencher variety. The new formula also includes Vitamins C and B12, unlike the old recipe and its competitor’s product.
Powerade’s updated packaging, along with marketing that some shoppers will see online, prominently calls out the differences between itself and Gatorade.
But, as with many beverage-industry rivalries, this essentially comes down to a battle between Coke and Pepsi.
Gatorade was developed at the University of Florida in the mid-1960s, and acquired by PepsiCo (PEP) in 2001. Coca-Cola (KO) launched Powerade in the 1980s to compete with Gatorade, but Coke’s version never caught up. Meanwhile, Gatorade became associated with winning, as successful coaches are traditionally showered with the stuff after a game.
Over the years, as the category has grown, both Gatorade and Powerade updated their designs and launched new products. In 2021, Coca-Cola acquired BodyArmor, a relatively young but successful company with its own sports drinks. (Coca-Cola first bought a stake in BodyArmor in 2018.)
The unit now oversees the Powerade brand for Coke, and it has been making the changes — and spotlighting comparisons to Gatorade.
“We’re gonna be loud about it. We’re gonna be proud of it,” Federico Muyshondt, CEO of BodyArmor told CNN.
As recently as 2020, Powerade was positioning itself as a rival to BodyArmor, even when Coca-Cola was already invested in the younger company. Working together, “we can use, now, BodyArmor and Powerade as a one-two punch to beat Gatorade,” Muyshondt told CNN.
“BodyArmor can help us make a big-step change in the sports drinks category, particularly in the US,” Coca-Cola CEO James Quincey said during a conference in June.
Today, Gatorade controls about 63% of the US sports drinks market by volume, according to data from Euromonitor International. Combined, Coke’s brands own about 29% of the market: BodyArmor has 14.5%, and Powerade, just 14.1%.
Still, there’s room for growth in the category, as customers seek alternatives to carbonated sodas and for beverages perceived as “healthier” hydration.
Euromonitor predicts that the $13 billion US market will grow to nearly $17 billion in 2027. Muyshondt thinks that Coca-Cola will be leading the category by that year.
Powerade will need more than just a new look and formula. The brand will get more investment and more innovation in the coming years, said Muyshondt, who would not share specifics, but did say that he may draw inspiration from sports drinks markets globally.
“Powerade is a sleeping giant,” he said. “It’s time to put a lot of energy into it.”
As for its new brand sibling, he said the plan for BodyArmor is to reach more customers with the help of Coca-Cola’s massive scale. The two brands complement each other with BodyArmor appealing to people who are interested in health, wellness and fitness and are willing to spend more. Powerade is a more affordable brand that focuses on sports and hydration.
Coca-Cola’s strategy is about more than just gaining a bigger share in the sports drinks market. Bringing BodyArmor into the fold is an example of how it approaches acquisitions, Quincey explained during the company’s annual shareholder meeting in April.
“BodyArmor is a great addition to the branded portfolio because it checks almost all the boxes we look at when we try to acquire a business,” he said. “We believe it has some global scalability and much more.”