Gatorade Water brand stretch: “dumb” or “genius”?
Brand stretching is a risky business, as the subtitle of our book Brand Stretch suggests: Why 1 in 2 Extensions Fail and How to Beat the Odds. This week, I came across a Linked In post on an interesting new brand stretching attempt: Gatorade Unflavoured Water. At first, the author of the post (thanks Brent Vrdoljak) said the new launch seemed “dumb“, but then suggested “it’s actually genius” (1). He went on to say, “I think the extension makes perfect sense for their brand, and they have the power to pull it off.”
Will it be a genius winner? Or is it a dumb move that will end up in the overcrowded “brand stretch graveyard“? In this post, we put Gatorade Water through our strategic stretching assessment to estimate which of these two takes on the brand launch is more justified.
1. Re-cap on the Gatorade brand
The Gatorade brand was built on enhancing sport performance. It was invented almost 60 years ago by University of Florida scientists, on the request of assistant football coach Dewayne Douglas, to help athletes rehydrate by quickly absorbing salts and sugars (3). “Gatorade provides scientifically formulated products to meet the sports fueling needs of athletes in all phases of athletic activity,” is how the Gatorade website describes the brand’s positioning (4). A recent film with rapper Eminem brings the fuelling athletes idea to life, ending with the tagline “Fuels Greatness. Fuels You” (below).
The brand also has a strong set of distinctive brand assets. These include the letter ‘G’, the flash and the colour orange (below). The brand also has a strong link to sport, reinforced by sponsorship. In particular, the strategic, long-term link with the NFL is a powerful brand activation asset. “The brand has been the league’s most-recognized sponsor every year since 2007, with 62% of NFL fans correctly identified Gatorade as an official sponsor”, noted one recent report (5).
2. Size of prize
Having recapped the Gatorode brand assets, the first question to address is the likely size of prize for the new launch. This is based on two key factors: 1. the size and growth of the market, 2. the added value the brand brings to the new market.
In terms of market opportunity, the bottled water market is certainly big at over $350billion globally. And it is forecast to grow at c.5% annually in the coming years (2). So far, so good.
What about the brand added value of Gatorade Water? The descriptor used is “unflavoured”. Yes, you read that right: water without flavour. The last time I looked, you could get water without flavour from a tap. Furthermore, if you want water for sport, you fill a re-useable bottle with tap water at the gym and do your little bit for the planet, rather than buying a plastic bottle of water.
The ad below does also talk about being “electrolyte infused’. However, these electrolytes are not linked to hydration for performance in line with Gatorade’s brand heritage. Instead, they are there for “great taste“. But hang on a minute. I thought the idea here was water that is unflavoured? So, the great taste in question is the taste of, er, water? Net, it doesn’t seem that Gatorade is bringing significant brand added value to the water market.
And what about leveraging the distinctive brand assets that have helped make Gatorade famous? The colour orange has been used. But in what does seem like a strange bit of brand management, the “G” and the flash have not been used. Furthermore, the communication campaign for Gatorade Water fails to leverage distinctive imagery linked to sport and performance (below). Instead, we have a gentler, more lifestyle look and feel, with black & white photography and a couple of “world-renowned dancers, choreographers and producers”. The tagline, Always in Motion, is also much softer than that of the brand campaign shared earlier that talked about “fuelling greatness”.
Estimate on Size of Prize: LOW
3. Ability to win
The second question to address relates to the company’s ability to win in the new market. In my experience, this is the area where marketers are most likely to make mistakes. They sometimes under-estimate how hard it really is to create a sustainable, profitable long term business. Key questions include 1. manufacturing capability, 2. route to market and 3. commitment to sustained marketing investment, not just year one spend.
This is where Gatorade Water does have a lot going for it. Parent company Pepsico has expertise in bottling water, built up over many years. The company also has a route to market for the new product in addition to strong in-store presence.
My one question on Ability to Win is Pepsico’s stamina to invest for the long term, not just the launch year. The company already has number one brand in North America with Aquafina. It had $1billion of sales in 2022, growing +3.4% versus year ago. And the positioning doesn’t seem that far from Gatorade Unflavoured Water: “state-of-the-art purification so that you get the refreshment your body craves in its purest form.” Will Pepsico be committed to giving incremental investment to Gatorade Water for the long term?
Estimate on Ability to Win: MED to HIGH
4. Conclusion and final thoughts
Based on the above assessment, Gatorade Unflavoured Water looks unlikely to achieve long term success. It lacks significant brand added value and fails to leverage the Gatorade’s distinctive brand assets. On the plus side, it has the distribution muscle of Pepsico.
A final thought is that the Gatorade Water launch may be driven by a desire to offer an alternative to Coca-Cola’s water brand, Smart Water. The latter also has a fashion-forward, lifestyle take on hydration, with a recently announced partnership with Zendaya (below).
We’ll check back in 18-24 months to see how Gatorade Water is doing!
SOURCES:
2. Water market
