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Why beverage companies need to mend their old, sugary ways

With Virat Kohli ending his Pepsi endorsement deal over sugar content, cola companies scramble for solutions

brunch Updated: Oct 01, 2017 14:15 IST
Vir Sanghvi
A large fountain Coke or Pepsi of the sort they have in cinema halls, can contain upto 27 spoons of sugar
A large fountain Coke or Pepsi of the sort they have in cinema halls, can contain upto 27 spoons of sugar(Photo Imaging: Piyush Garg)

Were you surprised when Virat Kohli announced that he would not endorse Pepsi Cola because he no longer drank it – and he did not want to endorse products that he did not use?

I know I was. For a start, most of us have a healthy level of scepticism when it comes to celebrities and endorsements. We know that many (most?) of them never use the products they endorse and we also recognise that the only reason they have agreed to appear in the ads is money. Could, for instance, every Indian cricket captain have preferred Pepsi to Coke? And yet, nearly every captain that I can remember seems to have appeared in a Pepsi ad at some stage or the other.

While we don’t hold this against the celebrities (they have a right to make money) we are always a little surprised when one of them parts ways with a product he or she was endorsing. But, as far as I can tell, the Virat Kohli-Pepsi separation is exactly as it appears. Apparently Virat went to Pepsi, with whom he has had a friendly and mutually rewarding relationship for seven years, and said that he no longer drank their cola. And so he would not endorse it. He didn’t want to be put in a situation where, if somebody asked him at a press conference whether he drank Pepsi, he would have to lie and pretend he drank it.

The main difference between Diet Coke and Coke Zero is not the sweetener used, but that Diet Coke has lots of caffeine. Both Coke Zero and regular Coke have much less caffeine.

Not many celebrities walk away from an easy gig like a beverage endorsement (no figures are available but I guess Virat made something like rupees eight crore a year from Pepsi) out of conviction. But Virat seems to have done it.

But as much as both Pepsi and Virat are good natured about the break-up, there’s no denying that it has had the effect of focusing attention on an area that the beverage companies are not happy talking about: the huge amounts of sugar they liberally ladle into their drinks.

To see it in perspective, think of it this way. How much sugar do you put into your tea or coffee? If you put more than two spoonfuls, then most people would regard you as having a very sweet tooth. And at some stage, you will be warned about the detrimental effects of sugar on good health and such words as ‘diabetes’ and ‘obesity’ will be flung around.

One reason why most companies are so reluctant to experiment with sweeteners is that they believe that sugariness is essential to their appeal

Now consider how much sugar you consume when you have a glass of Coke or Pepsi. Depending on the size of your spoon, a single glass contains six to seven spoonfuls of sugar. If you saw somebody putting six spoons of sugar in his tea, you would conclude that the guy had a serious problem with sugar.

So how can anyone justify drinking a cola which has such monumental levels of sugar?

Short answer: they can’t.

And that is where all drink companies have a problem. It isn’t just colas. There are massive quantities of sugar in packaged fruit juice. A glass of apple juice has more sugar than a glass of Coke. It is not as though the non-cola drinks have much less sugar either. Limca, 7UP, Mountain Dew, Mirinda etc. are all packed with sugar.

And not everyone drinks only a single glass of cola anyway. When you go to the cinema, you end up drinking so-called ‘fountain’ versions of the drinks. A large fountain Coke or Pepsi of the sort they have in cinema halls, can contain upto 27 spoons of sugar.

Luckily for the beverage companies, at least until the Virat story hit the headlines, Indian consumers are much less worried about sugar than our counterparts in the West. Contrary to what you and I may think, the cola market is not restricted to middle class kids in big cities. It reaches every corner of India and the vast majority of cola-drinkers are not middle class sophisticates.

Despite the billions of rupees that Coke and Pepsi have spent on pushing their brands, the best-selling cola in India remains Thums Up, which has a dedicated following in small towns and villages. Coke, which bought Thums Up decades ago, uses the likes of Salman Khan to push it and the strategy continues to work.

The people who do care about sugar in drinks are people of the sort who read Brunch and order diet drinks. But if you want to know how small we are in relation to the total universe of cola drinkers, a single statistic should suffice: all diet colas account for less than two per cent of the total cola market. Most Indians are happy drinking the sugar-heavy stuff.

Among the diet-cola lovers, there is now a new problem. Till about two years ago, it was believed that as awareness of the dangers of too much sugar spread, the proportion of those who drank Diet Coke or Diet Pepsi, rather than the regular stuff, would rise. In fact, the number has stayed stagnant or has actually fallen.

Pepsi Black differs from Diet Pepsi because it uses no aspartame at all

There is a single reason for this: the now widely prevalent view that diet drinks are bad for your brain. This view is held even by those who don’t know much about sweeteners. But many doctors will claim that the culprit is aspartame (used in Equal, NutraSweet and most diet drinks), which will cause you to lose your memory or slip into dementia. Better to rot your teeth with sugary cola than to rot your brain with the diet version, they say.

There is absolutely no medical evidence for this view and were it not for the fact that many doctors and dieticians cling to it, I would call it an old wives’ tale. The US, which has stringent health and safety checks, has found that aspartame poses no risk to health. But even though the aspartame industry has spent millions trying to counter this view, it is fighting a losing battle.

Two years ago, Pepsi announced that it would stop using aspartame in Diet Pepsi in the US. Instead it would use the currently fashionable sweetener Stevia, which is of plant origin (aspartame is made in a lab.)

A manifestation of this policy in India is the new Pepsi Black, a diet drink that differs from Diet Pepsi in that it uses no aspartame at all. Instead sucralose (a sweetener from the same family as Splenda) is used. So far, Coke has stuck with aspartame. The main difference between Diet Coke and Coke Zero is not the sweetener used but that Diet Coke has lots of caffeine. Both Coke Zero and regular Coke have much less caffeine.

But of course, the worries about sugar do not apply to diet drinks. They apply to the regular versions. And the beverage companies are hard at work to counter the criticism. A few months ago, Pepsi launched an interesting pilot project in Gujarat. It reduced the sugar content of 7UP, a Pepsi brand, by around 30 per cent and made up for the loss of sweetness by using Stevia.

(From top) Virat Kohli announced that he would not endorse Pepsi Cola because he no longer drinks it; Thums Up remains the best-selling cola in India that uses the likes of Salman Khan to push it; Deepika Padukone is the brand ambassador of Coca Cola

Nobody complained and so Pepsi will roll out this lower- sugar 7UP at all its plants across India. Significantly, it will not be called a diet drink or a low sugar version. It will be sold as normal 7UP.

I spoke to Vipul Prakash, Pepsi’s Senior Vice President for its beverage division about the future. He is sensitive to the concerns about aspartame but he thinks that the real battle will be fought in the regular drinks sector. And while the avoid-sugar orthodoxy has not yet arrived in mainstream India, he thinks it is only a matter of time before it does. The 7UP experiment seems to be the way forward. Pepsi will now look at ways of reducing sugar in everything it sells from fruit juice to non-Cola drinks.

A glass of apple juice has more sugar than a glass of Coke

Will it work? The soft drink industry is obsessed with what it calls flavour profiles. It believes that the finely calibrated taste of each drink should rarely be tampered with. One reason why most companies are so reluctant to experiment with sweeteners is that they believe that sugariness is essential to their appeal. When Coke launched Coke Zero, the sales proposition was that it approximated the flavour profile or real Coke better than Diet Coke. Similarly Pepsi thinks that Pepsi Black tastes more like real Pepsi, this may be true but it is not necessarily an advantage: after years of drinking Diet Coke and Diet Pepsi, I find Pepsi Black too sugary (even though I know its sucralose not sugar) for my palate.

Of one thing however, there’s no doubt. When Virat Kohli said that he would not endorse Pepsi any longer, he didn’t just walk away from rupees eight crore. He made it clear to the beverage companies that their old, sugary ways would have to change.

From HT Brunch, October 1, 2017

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