Gatorade's new pitch: Water is wimpy

By Jeremiah McWilliams

The Atlanta Journal-Constitution

Some of Gatorade's latest advertisements belong to a genre familiar to any athlete on the blacktop or gridiron: Trash-talk. And this talk is aimed at what the brand sees as it's main competition.

"Water has no carbs. Water has no electrolytes. Water has no game," say Gatorade print ads running in Sports Illustrated, ESPN: The Magazine and Us Weekly.

"Water just can’t compare with 40 years of elite-level hydration."

Gatorade is one of the most important beverage brands sold by PepsiCo. PepsiCo says many beleaguered consumers turned to tap water to save money in the last two years or so. PepsiCo says that trend was a culprit in Gatorade's sales decline in 2009, and the company wants to fight back.

PepsiCo -- which also sells Aquafina bottled water -- insists tap water is a bigger threat to Gatorade than Vitaminwater and Smartwater, both of which are sold by archrival Coca-Cola Co. The ads also ignore Coca-Cola's Powerade brand, which controls more than 20 percent of the sports drink market and has taken market share from Gatorade this year, according to Nielsen Co.

"You couldn't ask for a more explicit confirmation from Pepsi that water has been their nemesis over the last few years," said Gerry Khermouch, editor of Beverage Business Insights. "It's not a paranoid fantasy on their part by any means."

Gatorade wants to remind sideline moms and actual athletes that Gatorade provides benefits that water doesn't. Straight tap water, says PepsiCo, provides a false economy.

"Make no mistake, when we look at the competition for Gatorade, we think about water," Sarah Robb O'Hagan, Gatorade's chief marketing officer, said this year at a conference for analysts. "That's who our main competition is, and we need to keep reminding our athletes that...if you are serious about sport, you need to be consuming Gatorade."

As Gatorade tries to tighten the brand's focus on serious athletes, PepsiCo is trying to make sure the brand touts its functional value. When Gatorade uses "efficacy" advertising, the brand typically targets water, O'Hagan said. One reason: More than half of athletic drinking occasions go to water instead of sports drinks.

"Tap water is the biggest opportunity for us," said O'Hagan.