PepsiCo on the launch of its first ecommerce-only brand Drinkfinity

PepsiCo allowed Drinkfinity to operate like a startup as it looks to foster innovation and react faster to new consumer trends.

PepsiCo is launching Drinkfinity in the UK, marking the first time it has brought an ecommerce-only brand to the market as it looks to widen its appeal among a younger, health-conscious customer and develop more one-to-one relationships with consumers.

Drinkfinity is a healthy squash-like drink that comes in the form of plastic ‘pods’ that are added to water. They include flavours such as Blackberry Acai Charge, White Peach Chill and Pineapple and Coconut Water.

Consumers can only buy the pods, along with a reusable bottle described as a ‘vessel’, on the Drinkfinity.com website.

The concept was developed by Hernan Marina, vice-president of business innovation in PepsiCo Latin America. It is based around four key trends – choice, sustainability, wellness and personalisation – all impacting how consumers buy and consume goods.

Having initially been trialled in Brazil, it is now rolling out to new markets including the US, UK and Europe. And Luis Montoya, president of PepsiCo Latin America Beverages and the senior sponsor behind Drinkfinity, believes it is a totally new direction for the company.

“There so many new things we’re doing with [Drinkfinity], like the fact that we are going direct to consumer, so we not really comparing it with other brands. We just think it’s a completely different thing on its own. It’s the future,” he tells Marketing Week.

Fostering a startup culture

It was eight years ago that Marina came to Montoya with the idea of Drinkfinity.  and the pair’s working relationship has been crucial to its success. Marina says: “You need sponsorship within the larger corporation with radical innovation. It’s important.”

Drinkfinity is born out of a concerted effort by PepsiCo to foster innovation Montoya says: “Innovation is cultural and in the last couple of years we’ve been working on building the culture of innovation. Sometimes ideas are born in the company, sometimes we get it from the outside but this is a wonderful example of an idea born from one of our own employees.”

Drinkfinity is the most flexible PepsiCo has ever been about a product Montoya says. He explains: “It’s a different way from the traditional way PepsiCo does things. A brand like Pepsi, it’s been going for 120 years so our products have to be designed for perfection, but with products like Drinkfinity we can make changes. We can change formulas very fast, change the blends, adapt to consumer trends so we actually can have the luxury of allowing room for failure.”

The brand, which describes itself as a “movement”, is designed to mirror how a startup operates, from innovation all the way through to execution. Marina and his team were entirely independent from the rest of PepsiCo, working in a office separate and using different manufacturers. That is reflected in the brand and its comms – PepsiCo is barely mentioned on Drinkfinity’s website and there is little to link the brand with its parent on its packaging or marketing activity.

Marina explains how this startup culture influenced the product. He feels Drinkfinity was “truly co-created with consumers” as his team set up focus groups of 50 people who stayed in rented homes while feeding back about the product.

He explains: “We called led them alpha users. We started in Sao Paulo. We rented a house called the Drinkfinity Lab and we got people that were really passionate about the idea. We ran all the ideas through them, we changed the vessel, flavour, everything because of them.”

The plastic problem

One of the four trends Drinkfinity is tapping into is sustainability, with the brand hoping to reduce the use of throwaway plastic water and juice bottles by offering a reusable water bottle. Yet each individual pod is surrounded by plastic and users can’t recycle the pods at home.

Instead, Drinkfinity has partnered with TerraCycle to recycle the pods, with Drinkfinity including a prepaid envelope with every purchase so customers can send back up to 30 pods at a time directly to TerraCycle. Drinkfinity does also donate £1 to Water.org, a non-governmental organisation dedicated to providing access to safe water and sanitation to communities, for every order over £30.

READ MORE: Plastic waste – Why brands need to look beyond the PR opportunity

But given growing concern over plastic and its impact on the environment and recent commitments by major brands to tackle plastic waste, is Drinkfinity doing enough for the environment?

Marina thinks so. “Our vision is to have the the least possible [environmental] footprint on Drinkfinity. When you look at Drinkfinity as a whole the vessel is a BPA-free reusable bottle. It’s also not just about someone popping pods every half an hour, it’s also to drink water.”

Taking a flexible marketing approach

Drinkfinity aims to tap into the market for health-conscious millennials who want brands to reflect their lifestyle. At £30 for 16 pods and a water bottle, and £6.50 for subsequent packs of four pods, it certainly isn’t cheap. Yet the brand claims that thanks to a referral system with influencers, it has already gained a lot of interest – generating a list of more than 20,000 people interested in the brand ahead of launch.

Unsurprisingly for its model the brand will be marketing almost entirely through digital channels., with a focus on social media and influencers.

“We have to be very flexible in our marketing approach. We are not thinking about a big bang approach like sponsoring the the SuperBowl, instead we are aiming to really connect with consumers. That’s why we’re doing ecommerce because we want to establish a  one-on-one connection,” Montoya explains.

Those one-on-one connections, PepsiCo hopes, will give it valuable insights into consumers they don’t already know. At the moment success is less about sales and more about high engagement and gaining as much data as possible. Marina says: “With Drinkfinity we measure that engagement in frequency of use and a lot in feedback. We send online surveys we really try to build that relationship and learn how their using it.”

It is a model that Montoya believes will be emulated across the drinks giant in the future. He concludes: “PepsiCo is definitely developing ecommerce and I think that is the channel of the future. As the first product to be sold by ecommerce alone this will have an impact on the PepsiCo corporation as a whole.”

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