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Is Emotion The Winning Performance Metric?
Ads that induce emotion are nearly twice as effective at driving sales. Ahead of Cannes, new Zappi data reveals what truly makes creative perform. The ads that make you feel something, say joy, nostalgia, even a lump in your throat, are doing more than tugging at heartstrings. They're moving the bottom line. New data shows that emotion-led ads are nearly twice as likely to drive immediate sales compared to their flatter, more rational counterparts. Emotion becomes a performance strategy. This insight comes from the State of Creative Effectiveness report, released ahead of Cannes Lions by consumer insights platform Zappi, in collaboration with VaynerMedia. Based on 4,000+ ads tested and feedback from over 1.6 million US consumers, the central message is that 'emotion fuels effectiveness'. Ads that land in the top quartile for emotional connection achieve a 78th percentile ranking for sales impact versus just a 41st percentile for those that miss the mark. And while humor increases enjoyment, it doesn't always lead to action. Top Insights from The Report Celebrity ads, while more distinctive (3.5/5), underperform in brand impact compared to non-celebrity ones (55th vs. 63rd percentile). Humor, though popular, doesn't always translate into purchase intent. Category performance reflects both strengths and missed opportunities. Food and beverage: Food ads drive the biggest short-term purchase lift, increasing likelihood to consider the brand by 29% followed by alcohol ads, which increases consideration by 27%. Pet care: Also has a strong purchase uplift at 29% as well as the highest overall emotion score (68/100), which is driven by its strong love score (39% versus the 28% U.S. average). Personal care: Excels in relevance (3.9/5) and emotional response (61/100). Financial services: Lags behind industry averages in emotion (47%) and distinctiveness (3.6/5), but show signs of progress through humor (17%) and modest purchase uplift (15%). Telecommunications: Also lags behind industry averages in emotion (45%) and distinctiveness (3.4/5), but slightly overperforms industry averages in humor (10%) and purchase uplift (21%). 'Today's consumers expect more in that they want to be informed, but also expect to be entertained,' said Nataly Kelly, Chief Marketing Officer at Zappi. 'The brands that deliver best are those that bring the consumer into the process, test iteratively and learn over time.' READ MORE: What Experiential Marketing Teaches Us About Customer Loyalty PepsiCo, for example, reported a 30% improvement in creative effectiveness after adopting Zappi's ad testing platform, Amplify. A Forrester study confirmed the approach that brands using Zappi saw a 5%+ lift in ROAS over traditional research methods. The Fix: How Brands Can Move From Ads That Talk to Ads That Matter Start with emotional intent , not just messaging goals. Test early, test often —real consumer feedback can shift strategy before it's too late. Balance creativity with connected insights . Great storytelling is only as good as the reaction it triggers. 'Putting the consumer at the center isn't just a philosophy, it's how we build strategies that embed brands directly into culture,' said Wanda Pogue, chief strategy officer at VaynerMedia. 'Content at scale, informed by real-time consumer feedback helps us create more opportunities for meaningful connections and significantly mitigates the risk of ineffective creative wasting valuable media dollars.' Feel Something. Sell Something. As the industry heads into its biggest celebration of creativity at Cannes Lions, the takeaway is clear: creative that moves people , moves markets. Emotion isn't soft. It's strategic. And in a world oversaturated with content, it might just be the most powerful metric you have. READ MORE: Media Waste Isn't an Accident — It's a Choice The Martechvibe team works with a staff of in-house writers and industry experts. View More advertisingconsumer feedbackcreativeStrategyZappi Locala's omnichannel advertising platform leverages granular insights and cutting-edge AI to help marketers plan, activate, and measure campaigns that are personalised to the local consumer. It specialises in transforming complex mobility and consumer data into actionable audience insights, fueling advanced media strategies. VISIT WEBSITE Blue Prism is a global software provider, offering ROM 2, an intelligent automation implementation methodology that empowers teams to scale their digital workflow. One of its use cases is sales and marketing solutions, which is powered by artificial intelligence (AI) and machine learning (ML) algorithms. VISIT WEBSITE Pega is a combined business process management and robotic process automation (RPA) platform that comes with workforce analytics features. It offers a wide variety of tools such as Pega Email Bot to automate repetitive tasks with personalised customer replies at scale. 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It integrates solicited customer feedback with unified-CXM data, enabling brands to derive meaningful, actionable insights. Utilising its genAI-powered survey builder, marketers can create conversational surveys to streamline their NPS strategies. VISIT WEBSITE Salesforce is a comprehensive customer-oriented technology provider offering a feedback management suite. Salesforce's survey responses help marketers create personalised surveys based on their existing customers' data. Some of the supported applications of its feedback management platform are genAI-powered survey form development and sentiment-insights-based survey collections. VISIT WEBSITE QuestionPro is an online feedback software provider, offering ready-made survey templates to businesses across 40+ countries. Leveraging the capabilities of its customer satisfaction templates, advertisers and marketers can create and gather tailored questions. VISIT WEBSITE Qualtrics is an all-in-one customer experience solution provider, offering website & app feedback tools for organisations to collect customer feedback efficiently. Its digital experience analytics capabilities combined with DXA integrations, bring together verbal and behavioural data for in-depth analysis of user feedback. VISIT WEBSITE HubSpot is a one-stop marketing platform, providing customer feedback software under its Service Hub offerings. Its pre-built APIs include net promote score (NPS), customer effort score (CES), and customer satisfaction (CSAT) surveys, allowing marketers to strengthen their customer loyalty strategy. VISIT WEBSITE Medallia is a comprehensive platform, enabling marketers to capture feedback from all customer touch points. Some of its popular feedback management software capabilities include Sense360 for analysing consumer spending, Medallia Video to automatically extract meaningful insights from customer's feedbacks and Agile Research for creating branded surveys in real-time. VISIT WEBSITE Zeotap lets brands integrate, unify, segment and orchestrate customer data, fostering a cookieless future. It offers a 'Non-Customer Entity Data' feature that helps marketers to integrate both customer and non-customer entity data. VISIT WEBSITE Twilio provides, Twilio Segment, an AI-powered CDP, enabling marketers to streamline their personalised customer engagement journeys. It brings together clean, consented customer data for real-time insights with 450+ pre-built connectors. VISIT WEBSITE Syntasa provides data-ready CDP capabilities, equipping marketers with essential tools to prepare their customer data. It offers real-time sentiment analytics capabilities, helping enterprises derive behavioural insights from unified user profiles to foster hyper-personalised experiences. VISIT WEBSITE SAP is a company-wide customer data management platform, helping marketers improve engagement, conversion, and retention. It offers a genAI-powered data model, enabling enterprises to unify their B2B and B2C customers' profiles to reach their personalisation goals. VISIT WEBSITE Oracle is a global database management company, providing CDP solutions, under its flagship product: Oracle Unity. Its AI-powered models enable marketers to create hyper-personsalised campaigns with predictive insights by streamlining real-time customer data from heterogeneous sources. VISIT WEBSITE Growthloop is a composable CDP platform, allowing marketing and sales team to action their data at scale. It offers GrowthLoop Audience Builder, enabling marketers to initiate their lead generation functions. VISIT WEBSITE Adobe Experience Cloud offers a real-time CDP, letting users create high-value audience segments for B2C and B2B use cases across their marketing funnel. It follows a cookieless marketing approach to automatically unify customer data across various online and offline channels in real-time. VISIT WEBSITE ActionIQ is a composable CDP platform that offers audience segmentation, acquisition marketing, and Customer 360 capabilities. It integrates analytical tools, enabling marketers to collect and analyse their first-party customer data at scale. VISIT WEBSITE Zoho CRM leverages automation and comprehensive analytics to empower any sales team, fostering stronger customer loyalty. Ideal for both small businesses and enterprises, this software enables enhanced productivity and tailored solutions through predictive intelligence. VISIT WEBSITE Zendesk offers Zendesk Sell, an easy-to-deploy CRM platform that is simple to deploy and navigate, catering to businesses of any scale. Its mobile-friendly Sell app has the functionalities of geolocation, helping sales and marketing teams. Offering an all-in-one CRM platform, organisations can implement use cases like prospecting, engagement, lead generation and communication capabilities. VISIT WEBSITE SugarCRM is a global CRM software provider, helping marketing, sales, and service teams improve efficiency through automation, data, and intelligence in near real-time. It offers Sugar Market, an all-in-one marketing automation platform that helps marketers to automate their campaign with higher ROI. VISIT WEBSITE Salesforce is a one-stop sales and support CRM software that regularly updates customer records, tracks emails and calls, and creates organised support processes for quicker customer responses. Its simple and scalable infrastructure is ideal for businesses of all sizes. VISIT WEBSITE Pipedrive stands out with its emphasis on automation, tailorability, and seamless integration. Purposefully built to enhance the efficiency and productivity of sales professionals, this CRM solution has an intuitive setup and robust capabilities. It facilitates lead generation, comprehensive sales analytics, and seamless business expansion. VISIT WEBSITE Oracle NetSuite CRM, a component of Oracle's business software suite, is for all midsize and booming businesses that want a comprehensive, integrated CRM solution with ERP capabilities. Using it, customers and partners can directly interact with the platform, freeing the additional work load for their sales team. VISIT WEBSITE Microsoft Dynamics 365 Sales represents a robust cloud-based CRM solution brimming with features such as pipeline assessment, relationship analytics, and conversational intelligence. It utilises AI-powered insights to provide actionable intelligence via predictive analytics, lead scoring and sentiment analysis. VISIT WEBSITE Less Annoying is a CRM software that utilises a straightforward search feature within its contact management system, making it easy to track contacts. It is ideal for small-sized businesses and offers a highly intuitive and user-friendly interface. VISIT WEBSITE Insightly offers CRM software solutions for enterprises looking to understand their audience data across various marketing functions. It integrates seamlessly with third-party apps, streamlining workflow automation, including bulk emailing and report generation. VISIT WEBSITE HubSpot's sleek dashboard with consolidated CRM tools simplify complex customer data, further transforming it into meaningful insights. Complementing typical CRM functionalities, HubSpot provides tailored options, including conversation intelligence and email monitoring. VISIT WEBSITE Apptivo delivers adaptable and web-based CRM solutions, enabling marketing and sales teams to streamline all customer service requirements across various devices and browsers. Despite its focused feature set, it encompasses over 65 interconnected applications alongside a robust sales pipeline management tool, ensuring efficient tracking of potential leads without any downtime. VISIT WEBSITE Sitecore offers composable cloud solutions with its flagship products, Sitecore Experience Platform(XP) and Sitecore Experience Manager (XM). They help marketers to overcome scalability challenges. Some of its features include intuitive visual editing, headless delivery, marketing automation, scalable personalisation, data and machine learning capabilities. VISIT WEBSITE Salesforce Experience Cloud is a platform that helps enterprises link clients, partners, and employees to securely exchange information and documents. Built on its Customer 360 platform, Salesforce's DXP ensures seamless integration with any solution in the Salesforce ecosystem. VISIT WEBSITE Oracle Cloud offers a comprehensive suite of platform-based marketing automation solutions for personalised B2B and B2C automation campaigns. Some of its featured products are Eloqua Marketing Automation, CrowdTwist Loyalty and Engagement, and Unity Customer Data Platform. VISIT WEBSITE Optimizely is a digital experience platform (DXP) provider that offers Optimizely One, an easy-to-use and fully integrated suite. It provides a single, unified workflow with thoughtfully embedded AI and machine-learning algorithms, accelerating work across the entire marketing lifecycle. VISIT WEBSITE OpenText offers a cloud-native, scalable platform for enterprises to streamline their marketing functions. It provides fully composable content management, digital asset management, creative workflows, personalisation, targeting and customer data technologies in one place, ensuring a holistic approach to B2B, B2E and B2C experiences. VISIT WEBSITE Neptune DXP is a PaaS(Platform-as-a-Service) provider, helping marketing teams build custom apps based on modular, reusable application building blocks. The company offers flexible environments to businesses across different verticals, further providing personalised digital solutions at scale. VISIT WEBSITE Magnolia is a composable DXP that comes with no-code connector packs and low-code micro-frameworks for third-party integrations. It also offers an open-source version alongside its commercial plans enabling enterprises to build tailored use cases. VISIT WEBSITE Liferay DXP helps marketers deliver personalised and connected digital experiences across a broad range of channels, including customer portals, websites, intranets, mobile apps, and connected devices. It offers intuitive CMS, user analytics, and site management tools that businesses need to launch, test and optimise digital experiences for faster go-to-market. VISIT WEBSITE Powered by IBM Consulting, IBM iX offers a composable DXP, providing a comprehensive solution to make enterprises' systems future-ready. Utilising its data-driven insights and intelligent workflows, marketers can design and deliver human-centred experiences across the customer lifecycle. VISIT WEBSITE HCL Digital Experience (DX), forms part of a wider HCL Customer Experience (CX) product portfolio, offering core capabilities such as content management, DAM, CDP called Signals, and low-code application development. It provides services in government, life sciences, insurance, financial services, and other verticals. VISIT WEBSITE Contentstack is a headless CMS and Composable Digital Experience Platform (DXP) solution provider that helps marketers gain a competitive edge. It recently launched into Google Cloud Marketplace, and is also available on Microsoft Azure and AWS. It seamlessly enables mid-market brands to adopt its omnichannel campaign engine to drive higher conversions and sales. VISIT WEBSITE Bloomreach Commerce Experience Cloud provides businesses an edge with its modular capabilities: Content Management System (CMS), Discovery features for search and merchandising optimisation, and Engagement tools such as Customer Data Platforms (CDP) for personalisation and analytics. VISIT WEBSITE Adobe Experience Cloud offers a comprehensive set of services specifically designed to address the day-to-day requirements for personalised customer experience at scale. Its platform helps manage different digital content and assets to improve customer satisfaction. Some of its products include Adobe Gen Studio, Experience Manager Sites, Real-time CDP, and Marketo Engage. VISIT WEBSITE Acquia offers DXP solutions, comprising of two main elements: Acquia Drupal Cloud and Acquia Marketing Cloud. It can be accessed in both platform-as-a-service (PaaS) and software-as-a-service (SaaS) with additional components such as Site Factory for multisite management, digital asset management (DAM), CDP, personalisation, and Campaign Studio. VISIT WEBSITE
Associated Press
25-03-2025
- Business
- Associated Press
Appcues Announces Ryan Barry as CEO to Lead the Future of Customer-Centric Growth
BOSTON, MASSACHUSETTS / ACCESS Newswire Appcues, the leading platform for product adoption and user engagement, today announced the appointment of Ryan Barry as the company's new Chief Executive Officer. Barry steps into the role with a clear mandate: to redefine how technology businesses engage customers and scale customer value in a rapidly changing Barry, CEO of Appcues Introducing Ryan Barry as Appcues CEO, March 2025 Barry brings a proven track record of driving customer-centric growth. Prior to joining Appcues, he successfully scaled Zappi, helping large global brands implement customer-first strategies that significantly improved marketing effectiveness. His insights on customer engagement and market-driven growth were recently featured in the best-selling book The Consumer Insights Revolution, which he co-authored with his former business partner and Zappi's largest customer. 'I'm honored and energized to take on the role of CEO at Appcues,' said Barry. 'Appcues pioneered product adoption software - and today, we have the opportunity to go even further by helping technology businesses deliver real value to their users at scale. Most companies know what great customer experience looks like - but they struggle to deliver it consistently across the customer journey. That's the challenge Appcues is perfectly positioned to solve.' Barry highlighted the strong foundation built by Jackson Noel, co-founder and outgoing CEO, who is stepping back into a board of directors role. 'Jackson built a great business - with soul,' Barry added. 'He's a 10/10 man, an incredible leader, and someone I'm lucky to call a partner as he transitions to our board. We share a belief that great culture comes from giving amazing people the agency to improve customer outcomes.' Jackson Noel expressed confidence in Barry's ability to lead Appcues into its next phase of growth: 'I'm thrilled to welcome Ryan as the next CEO of Appcues,' said Noel. 'Ryan and I share many philosophies on company culture, team building, and customer focus. He's set an exciting vision for the future of our market and I'm eager to support him as he leads Appcues into its next chapter.' Brad Coffey, chairman of the board, also voiced strong support for Barry's vision and leadership: 'Ryan brings a great mix of strategic vision and operational expertise,' said Coffey. 'He has a deep understanding of our space and how to scale what works - but more importantly, he brings an unmatched level of energy and drive to deliver results for our customers, employees, and shareholders. The way people discover, try, and adopt software is changing rapidly with AI and new types of consumer experiences. Ryan has a clear vision for that future, and I'm excited for him to lead Appcues into that next leg of our journey.' Why Now Barry steps into the role at a time when technology businesses face growing pressure to improve product adoption and customer retention in a lean market. While companies have the expertise to solve customer challenges, delivering that expertise at scale remains elusive. 'Today's customer experience is fragmented,' Barry explained. 'GTM teams are under pressure to grow fast with fewer resources. CS teams are stretched thin. Marketing programs are thoughtful but often don't make it all the way through the customer journey. And users? They expect answers and value immediately - or they'll churn in 30 seconds.' Barry outlined the market reality most technology businesses are grappling with: Most new product launches fall short. Expansion is hard - even with strong land motions. Companies struggle to scale the expertise of their best customer-facing people. Users just want software that works - no QBRs, no waiting. 'Most companies are still running the same playbooks - MQL-driven marketing, siloed execution, and overburdened CS teams holding the whole thing together,' Barry added. 'They're playing defense. It's a losing battle. And it's time to change.' The Opportunity Appcues already helps more than 1,400 businesses deliver highly personalized and effective user engagement at scale. Barry believes the next step is to enable companies to move from reactive to proactive customer engagement. 'This isn't about chasing engagement - it's about giving go-to-market teams the power to scale what works, fast,' Barry said. 'Appcues is in a unique position to help companies anticipate customer needs, deliver value at the moments that matter most, and drive real business outcomes - adoption, expansion, and retention.' Barry pointed to recent success stories, including Fullstory's ability to drive rapid adoption and customer outcomes using Appcues: 'Companies like Fullstory are already proving what's possible when customer engagement is intentional, intelligent, and deeply tied to business outcomes. That's the shift - and we're going to lead it.' What's Next Barry outlined an ambitious roadmap for Appcues' future, including plans to introduce AI-driven autonomous experience delivery and launch a new customer advisory board and podcast. He also announced a global tour to meet customers and partners in key markets, including San Francisco, New York, Los Angeles, Austin, Toronto, Boston, London, and Tel Aviv. 'The future of customer experience isn't something we'll watch happen -it's something we're going to lead,' Barry said. 'If you want to be part of it - help us shape this category, challenge the old playbooks, and reimagine how technology companies grow - reach out. Let's make the shift together.' Appcues is the leading user engagement platform for technology businesses. Founded in 2014, Appcues helps go-to-market teams deliver highly personalized and timely in-app, email, and push experiences at scale, driving faster onboarding, increased product adoption, and improved customer retention. With over 1,400 customers worldwide, Appcues empowers technology companies to deliver the right message, to the right user, at the right time. Eric Keating
CNN
17-03-2025
- Business
- CNN
Poppi just sold for $1.6 billion
PepsiCo is buying Poppi, the popular prebiotic soda brand, in a $1.65 billion deal. The move marks PepsiCo's further shift into the 'better for you' category as consumers shy away from sugar-filled drinks and unhealthy snacks. In January, the company bought Siete Foods, which makes gluten-free chips for $1.2 billion, and PepsiCo bought the remaining half of the Sabra hummus brand it didn't own late last year. 'We've been evolving our food and beverage portfolio over many years, including by innovating with our brands in new spaces and through disciplined, strategic acquisitions that enable us to offer more positive choices to our consumers,' said Ramon Laguarta, CEO of PepsiCo, in a statement Monday. 'More than ever, consumers are looking for convenient and great-tasting options that fit their lifestyles and respond to their growing interest in health and wellness. Poppi is a great complement to our portfolio transformation efforts to meet these needs,' he added. Harnessing PepsiCo's major distribution agreements and marketing budget could give Poppi an advantage over rival Olipop, however both brands are still relative newcomers and have room to grow in terms of sales and awareness. Despite growing in popularity, only about 5% of consumers drink prebiotic sodas regularly, according to Zappi, a consumer research firm. 'The challenge for these brands lies in the disconnect between brand awareness and functional understanding,' said Nataly Kelly, chief marketing officer of Zappi, told CNN. 'While most consumers have heard of prebiotic sodas, only about a third truly understand what they are and how they work.' The transaction is subject to regulatory approval and PepsiCo didn't say when the deal would close. Poppi garnered a loyal fanbase since its appearance on 'Shark Tank' in 2018, when it was still called Mother Beverage. Poppi advertises its sodas as packed with prebiotics and apple cider vinegar that it claims can aid with gut health, although the health benefits on those claims are dubious. Pepsi's competitor, Coca-Cola, hopped on the trend by launching its own line of prebiotic sodas, Simply Pop, last month. Other similar sodas have also entered the market in recent weeks including Spindrift Soda and Bloom Nutrition. 'The gut soda wait-and-see period for major soda makers like PepsiCo and Coke is over. They have seen enough to jump in,' Duane Stanford, editor and publisher of Beverage Digest, said to CNN. PepsiCo's plans to launch its own prebiotic soda brand based off its Soulboost beverages have been scrapped. But Poppi's rise in popularity hasn't been completely drama-free. The soda company drew backlash over Super Bowl weekend last month for gifting full-sized full-sized Poppi vending machines to influencers, from social media users who called it out of touch. Despite the controversy, the market for healthy soda doesn't seem to be slowing down. The functional beverage sector, which is the industry phrase for non-alcoholic drinks that advertise additional health benefits, is growing at a faster pace than regular sodas. The category is projected to generate $2 billion in sales by 2029, according to Coca-Cola's research. Last month, rival Olipop received a $1.85 billion valuation after a $50 million funding round and that it turned a profit for the first time since its launch in 2018, doubling the previous year's sales at $400 million. Poppi has not publicly disclosed its valuation. 'We'll see whose strategy plays out best – buy like PepsiCo, or build with an existing brand, like Coke,' Stanford said. 'Much of that depends on whether this gut soda segment has long-term legs or is a mirage of our times.'
CNN
17-03-2025
- Business
- CNN
Poppi just sold for $1.6 billion
PepsiCo is buying Poppi, the popular prebiotic soda brand, in a $1.65 billion deal. The move marks PepsiCo's further shift into the 'better for you' category as consumers shy away from sugar-filled drinks and unhealthy snacks. In January, the company bought Siete Foods, which makes gluten-free chips for $1.2 billion, and PepsiCo bought the remaining half of the Sabra hummus brand it didn't own late last year. 'We've been evolving our food and beverage portfolio over many years, including by innovating with our brands in new spaces and through disciplined, strategic acquisitions that enable us to offer more positive choices to our consumers,' said Ramon Laguarta, CEO of PepsiCo, in a statement Monday. 'More than ever, consumers are looking for convenient and great-tasting options that fit their lifestyles and respond to their growing interest in health and wellness. Poppi is a great complement to our portfolio transformation efforts to meet these needs,' he added. Harnessing PepsiCo's major distribution agreements and marketing budget could give Poppi an advantage over rival Olipop, however both brands are still relative newcomers and have room to grow in terms of sales and awareness. Despite growing in popularity, only about 5% of consumers drink prebiotic sodas regularly, according to Zappi, a consumer research firm. 'The challenge for these brands lies in the disconnect between brand awareness and functional understanding,' said Nataly Kelly, chief marketing officer of Zappi, told CNN. 'While most consumers have heard of prebiotic sodas, only about a third truly understand what they are and how they work.' The transaction is subject to regulatory approval and PepsiCo didn't say when the deal would close. Poppi garnered a loyal fanbase since its appearance on 'Shark Tank' in 2018, when it was still called Mother Beverage. Poppi advertises its sodas as packed with prebiotics and apple cider vinegar that it claims can aid with gut health, although the health benefits on those claims are dubious. Pepsi's competitor, Coca-Cola, hopped on the trend by launching its own line of prebiotic sodas, Simply Pop, last month. Other similar sodas have also entered the market in recent weeks including Spindrift Soda and Bloom Nutrition. 'The gut soda wait-and-see period for major soda makers like PepsiCo and Coke is over. They have seen enough to jump in,' Duane Stanford, editor and publisher of Beverage Digest, said to CNN. PepsiCo's plans to launch its own prebiotic soda brand based off its Soulboost beverages have been scrapped. But Poppi's rise in popularity hasn't been completely drama-free. The soda company drew backlash over Super Bowl weekend last month for gifting full-sized full-sized Poppi vending machines to influencers, from social media users who called it out of touch. Despite the controversy, the market for healthy soda doesn't seem to be slowing down. The functional beverage sector, which is the industry phrase for non-alcoholic drinks that advertise additional health benefits, is growing at a faster pace than regular sodas. The category is projected to generate $2 billion in sales by 2029, according to Coca-Cola's research. Last month, rival Olipop received a $1.85 billion valuation after a $50 million funding round and that it turned a profit for the first time since its launch in 2018, doubling the previous year's sales at $400 million. Poppi has not publicly disclosed its valuation. 'We'll see whose strategy plays out best – buy like PepsiCo, or build with an existing brand, like Coke,' Stanford said. 'Much of that depends on whether this gut soda segment has long-term legs or is a mirage of our times.'
CNN
17-03-2025
- Business
- CNN
Pepsi joins the healthy soda wars and buys Poppi for $1.6 billion
PepsiCo is buying Poppi, the popular prebiotic soda brand, in a $1.65 billion deal. The move marks PepsiCo's further shift into the 'better for you' category as consumers shy away from sugar-filled drinks and unhealthy snacks. In January, the company bought Siete Foods, which makes gluten-free chips for $1.2 billion, and PepsiCo bought the remaining half of the Sabra hummus brand it didn't own late last year. 'We've been evolving our food and beverage portfolio over many years, including by innovating with our brands in new spaces and through disciplined, strategic acquisitions that enable us to offer more positive choices to our consumers,' said Ramon Laguarta, CEO of PepsiCo, in a statement Monday. 'More than ever, consumers are looking for convenient and great-tasting options that fit their lifestyles and respond to their growing interest in health and wellness. Poppi is a great complement to our portfolio transformation efforts to meet these needs,' he added. Harnessing PepsiCo's major distribution agreements and marketing budget could give Poppi an advantage over rival Olipop, however both brands are still relative newcomers and have room to grow in terms of sales and awareness. Despite growing in popularity, only about 5% of consumers drink prebiotic sodas regularly, according to Zappi, a consumer research firm. 'The challenge for these brands lies in the disconnect between brand awareness and functional understanding,' said Nataly Kelly, chief marketing officer of Zappi, told CNN. 'While most consumers have heard of prebiotic sodas, only about a third truly understand what they are and how they work.' The transaction is subject to regulatory approval and PepsiCo didn't say when the deal would close. Poppi garnered a loyal fanbase since its appearance on 'Shark Tank' in 2018, when it was still called Mother Beverage. Poppi advertises its sodas as packed with prebiotics and apple cider vinegar that it claims can aid with gut health, although the health benefits on those claims are dubious. Pepsi's competitor, Coca-Cola, hopped on the trend by launching its own line of prebiotic sodas, Simply Pop, last month. Other similar sodas have also entered the market in recent weeks including Spindrift Soda and Bloom Nutrition. 'The gut soda wait-and-see period for major soda makers like PepsiCo and Coke is over. They have seen enough to jump in,' Duane Stanford, editor and publisher of Beverage Digest, said to CNN. PepsiCo's plans to launch its own prebiotic soda brand based off its Soulboost beverages have been scrapped. But Poppi's rise in popularity hasn't been completely drama-free. The soda company drew backlash over Super Bowl weekend last month for gifting full-sized full-sized Poppi vending machines to influencers, from social media users who called it out of touch. Despite the controversy, the market for healthy soda doesn't seem to be slowing down. The functional beverage sector, which is the industry phrase for non-alcoholic drinks that advertise additional health benefits, is growing at a faster pace than regular sodas. The category is projected to generate $2 billion in sales by 2029, according to Coca-Cola's research. Last month, rival Olipop received a $1.85 billion valuation after a $50 million funding round and that it turned a profit for the first time since its launch in 2018, doubling the previous year's sales at $400 million. Poppi has not publicly disclosed its valuation. 'We'll see whose strategy plays out best – buy like PepsiCo, or build with an existing brand, like Coke,' Stanford said. 'Much of that depends on whether this gut soda segment has long-term legs or is a mirage of our times.'
