BodyArmor thinks eliminating this one ingredient will help it topple Gatorade

By Jordan Valinsky, CNN

New York (CNN) — Coca Cola-owned BodyArmor is unleashing its newest beverage as part of its years-long effort to overthrow Pepsi’s Gatorade from its position as the top-selling sports drink brand.

Rolling out to retailers this month is BodyArmor Zero Sugar, a sugar-free version of its popular flavored sports drink, taking aim at Gatorade’s G Zero beverages.

BodyArmor is differentiating itself by its ingredients — or lack thereof — compared to Gatorade, since it isn’t made with artificial sweeteners, flavors or dyes compared to its competitors.

In an exclusive interview with CNN, BodyArmor CEO Federico Muyshondt called Zero Sugar the “biggest launch” the 12-year-old brand, which Coke fully bought in 2021 in a $5.6 billion deal, has ever had.

“It’s a massive opportunity for BodyArmor because it’s a part of a category that represents 20% of the overall category and where BodyArmor wasn’t participating in,” Muyshondt told CNN. “We know that there is a consumer that looks specifically for zero sugar, and until now, BodyArmor didn’t have a product to play with there.”

BodyArmor Zero Sugar comes in four flavors, including fruit punch, lemon lime, orange and cherry lime. It’s sold in three bottle sizes: 16 ounces, 20 ounces and 28 ounces.

Muyshondt added that artificial ingredients are “big barriers of entry” for people looking for sugar-free sports drinks. In particular, he thinks that “gatekeepers” (i.e. parents doing the shopping for the household) have been resistant in purchasing sugar-free drinks because of that.

The sugar-free drink is a “natural expansion” for BodyArmor, Muyshondt said, that gives the brand more opportunity to grow at the expense of Gatorade but also to bring new drinkers into the growing category.

“In regular sports drinks and low-calorie sports drinks, BodyArmor has come in and expanded the category,” he said. “We are bringing in new consumers and new people into the aisle which is a great thing for our retailers and our bottlers.”

Sweating from competition

BodyAmor has been gaining on the dominance Gatorade has held for about six decades but still lags far behind.

Research firm Euromonitor reports that Gatorade commanded 63.5% of US sports drink marketshare in 2023, compared to BodyArmor’s 12% and 14.3% for its sister brand Powerade. In particular, G Zero holds 6% and Prime, the buzzy two-year-old brand, controls 1.7%.

The firm predicts that the $13 billion US market will grow to nearly $17 billion by 2027.

BodyArmor had “no choice but to launch a zero sugar version to remain competitive, and this product will move the needle,” said Duane Stanford, editor and publisher of Beverage Digest.

Last year was a rocky year for BodyArmor under Coke’s purview. After sales for both BodyArmor and Powerade both slipped in the beginning of 2023, Coke said in its most recent earnings call that “trends are stabilizing” for both brands.

“BodyArmor is adjusting to the next phase of competition and maturity by going after the zero sugar and powder markets while also looking outside US for growth,” said Stanford. (BodyArmor has entered Canada, marking its first international market.)

Part of Coke’s effort to overtake Gatorade was to revamp Powerade, which is also under Muyshondt’s control. Last year, the lower-priced Powerade received a makeover and a revamped recipe that boasts about twice as many electrolytes as its previous iteration.

Another factor is Prime, which announced that it was crossing $1 billion in sales last year. Although it still seriously lags Gatorade, Powerade and BodyArmor in size, Stanford said that the drink “has been a shock to the system in the US, gaining sports drink share at a pace no one thought possible.”

“The challenge for Gatorade and BodyArmor is to adjust to a new marketing reality while not abandoning the innovation that got them to the top,” Stanford added.

BodyArmor’s Muyshondt said that Prime is a “phenomenon that we’ve never seen before in beverages or in food,” but that isn’t scaring off the brand from innovating or growing.

“Hydration as a whole is way more than sports and that’s where I think BodyArmor is ahead of the curve,” said Muyshondt. “BodyArmor has been positioned as a sports drink, but it’s way more than sports. It’s about physical fitness. It’s about holistic health and wellness, and that’s why I think BodyArmor is set to win.”

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