Coke Vows New Sports Drink 'War' For Would-be Gator-Slayer Powerade - Coca-Cola Co. to boost marketing budget for Powerade as it hopes to take share from Gatorade - Brief Article - Statistical Data Included

Brandweek, March 12, 2001 by Kenneth Hein

Coca-Cola has vowed to boost the marketing budget for Powerade, its bulwark against category-dominating Gatorade, with the first leg of its new push due next month with an under-the-cap promotion tied with ESPN's SportsCenter and the NHL.

The promo, which will instruct consumers to watch Sports Center in April to see if they've won a number of prizes, will be supported by TV and radio.

Sources at Coke said the company will also narrow the spending gulf between Gatorade and Powerade. Since Powerade was unveiled in 1994, Gatorade has regularly dwarfed the brand in media spending--and sales.

Gatorade spent $95.5 million through November 2000, compared to Powerade's $31.2 million, per Competitive Media Reporting. In 1999, Gatorade spent $81.7 million, while Powerade totaled $17.6 million.

"We're going to intensify our own aggressiveness with Powerade and possibly other sports drinks," Jeff Dunn, president of Coke North America, said. "It's the beginning of an intense sports-drink war."

Powerade has its work cut out as it owns only about 12% of the sports drink category Gatorade has an 83% share.

A large part of Powerade's strategy this year will be to heavily leverage Coke's relationship with the 2002 Winter Olympics in Salt Lake City, much like the brand did with the 2000 Sydney Games. Powerade was supported during the summer Games by a $30 million-plus ad campaign from agency McCann-Erickson, New York.

Events have already been planned around the 2002 torch relay that will kick off Dec. 4 in Atlanta and wind up in Salt Lake City on Feb. 8, 2002. Coke has already begun to advertise its Olympic sponsorship via its "Pass the Torch" ads, also created by McCann.

The stakes are significantly higher now for Coke as PepsiCo acquired Quaker Oats last year for $13.4 billion, primarily to get Gatorade. The FTC is currently reviewing the deal. In the meantime, little attention has been paid to Pepsi's homegrown but lackluster All-Sport drink and Sports System, a line inherited from Pepsi's recent SoBe buy. Pepsi has said it will unload All-Sport if it trips up the Quaker deal in any way