By Scott Leith, The Atlanta Journal and Constitution Knight Ridder/Tribune Business News
Aug. 14--A year ago, Coca-Cola had a decision to make about its struggling sports drink, Powerade.
Save it or kill it?
Now the decision is clear. Coca-Cola is overhauling Powerade, with new formulas, new marketing and new packaging. Coke even hired Michael Vick, a promising young quarterback with the Atlanta Falcons, to play a prominent role in upcoming TV commercials.
Few things will remain the same except the Powerade name itself -- and the fact that rival Gatorade rules the sports drink category.
'If you're going to be challenger brand, you've got to try things. You've got to gamble,' said senior brand manager Rohan Oza.
Tuesday, Coke plans a very un-Cokelike media event in New York to hype the brand. It will feature two weightlifters pulling semis near Union Square.
Next week, Coke will debut a new TV ad for Powerade, with Vick as the star. Coke dearly hopes Vick becomes a high-impact player, as did Michael Jordan after Gatorade signed him as a spokesman.
'Gatorade got lucky,' Oza said.
In an early ad, Vick throws a football so hard it sails into the upper deck. Another pass knocks a receiver on his rear. The tagline is 'Very Real Power' under a redesigned logo.
Longer versions of the spot show clips from extreme sports. Oza said the goal is to position Powerade as a drink that appeals to active people, not just athletes.
Beyond new ads, Powerade is getting more vitamins, namely B-3, B-6 and B-12. There is a new Powerade Light. Later this year, three brand extensions are planned, including Powerade A.M. and Powerade Psych.
The challenge is to cut into Gatorade's vast lead in the U.S. market. In 2000, Gatorade sold about 325 million cases, according to Beverage Digest. Powerade was at 62.6 million.
Pepsico recently bought Gatorade's parent company, Quaker Oats.
'It's going to be a herculean struggle, but the strategy is a smart one,' said John Sicher, editor and publisher of Beverage Digest.
The new ads also bear a resemblance to Nike TV commercials. This is no accident: The agency behind them, Wieden & Kennedy of Portland, Ore., is the creator of Nike's successful campaigns.
Sicher said the relaunch will be a success if Powerade posts any growth at all. Catching Gatorade will be virtually impossible. 'Gatorade has withstood attempts to nibble away its market share for years,' Sicher said.
Powerade does better overseas, Coke said. But Pepsi is also expected to start pushing Gatorade in foreign markets.
Oza, who has worked on Coke's Sprite brand, said the company considered dumping Powerade because of its poor performance. But sports drinks are a fast-growing category, with $2.6 billion in U.S. sales last year, vs. $60 billion for carbonated beverages.
'You want to be a player in this category,' Oza said.
Coke isn't saying how much it will spend on the relaunch. Advertising Age estimated the ad budget at $40 million to $60 million.
While Powerade aims for Gatorade, another competitor hopes to catch Powerade. Third-place player All Sport, until recently owned by Pepsico, is in the hands of new owners, Monarch Co. of Atlanta.
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(c) 2001, The Atlanta Journal and Constitution. Distributed by Knight Ridder/Tribune Business News.
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