Nov. 21--ATLANTA--From humble beginnings came a brand worth billions.
That's the story of Gatorade, a sports drink developed in the mid-60s for the University of Florida football team.
Today, Gatorade dominates its niche, despite a decade-long assault by the biggest players in the beverage business, Coca-Cola and Pepsico. Like Kleenex or Jell-O or Coke itself, the name Gatorade has become almost synonymous with its entire beverage category.
The reasons for Gatorade's success are multiple, including a head start, savvy marketing and a focus on enhancing athletic performance.
The growth has made Chicago-based Quaker Oats, Gatorade's parent, a coveted possession. Atlanta-based Coca-Cola confirmed Monday that it is in talks with the company about a possible transaction.
'Gatorade created the category and was in the market years before other sports drinks,' said John Sicher, editor and publisher of Beverage Digest. 'On top of that, Quaker Oats has simply done a first-class job marketing the brand.'
Gatorade hasn't rested on its laurels, despite the arrival of competitors like Coca-Cola's Powerade and Pepsi's All-Sport. And its 73 percent market share hasn't kept Coke and Pepsi from trying to steal its thunder.
The drink has its roots in Gainesville, Fla., where researchers developed it for the Florida Gators football team. The idea was to replace fluids lost during exercise. The formula dates to 1965.
Stokely Van-Camp bought the brand in 1967 and, in 1983, Quaker Oats picked it up.
'The success of Gatorade is really a function of just how well Quaker has advertised and marketed and built it,' Sicher said.
Gatorade is considered a sports drink, as opposed to an energy drink that provides a physical lift through vitamins, caffeine and other ingredients.
Quaker has given Gatorade a scientific sheen through the Gatorade Sports Science Institute, which was established in 1988 and does research on sports nutrition.
Gatorade pitches itself as being better than water, and the institute conducts studies to help back the claim.
'This is really a functional drink that has a science behind it,' Sanford Bernstein analyst Bill Pecoriello said. It has sweeteners to provide carbohydrates and electrolytes to provide minerals.
Gatorade was also savvy in twining itself with pro athletes. It signed up Michael Jordan in 1991. The brand's 'Be Like Mike' tagline helped build Gatorade at a time when Pepsi and Coke were gunning for it.
Today, Gatorade is linked with the NFL, NBA, Major League Baseball and NASCAR. The Gatorade 'shower' is a staple of winning celebrations at football games, giving the drink an endless stream of free publicity.
Whoever buys Gatorade will be getting strong management, assuming there are no changes at the top.
'Sue Wellington, who runs the Gatorade business at Quaker, is a real talent,' Sicher said. 'In my opinion, she's one of the best marketers in the country.'
The only downside might be tinkering with success.
'They're extremely focused,' Pecoriello said of the management team behind Gatorade. He added that any acquirer would run the risk of damaging what has worked so well.
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(c) 2000, The Atlanta Journal and Constitution. Distributed by Knight Ridder/Tribune Business News.
