Poppi and Pepsi: A Case Study for Naturally Colored Sugar

The acquisition of Poppi soda by Pepsi for $1.95 Billion (Pepsi.com) elevates novel and innovative beverages to high value in the overall beverage market.

Poppi’s growth over the past 7 years shows consumers who may have left the carbonated soft drink category are willing to come back for different formulas that align more closely with their values.

As consumers begin to re-calibrate their desired wants and needs in a beverage, natural sugars like less processed cane sugar will likely play a larger role.

Sugaright provides naturally colored liquid cane sugars from 60 to 350 ICUMSA and can provide an alternative source of sugars for new products.

Poppi’s acquisition tells a story about how mainstream consumer values are shifting to less processed options.

According to Spins, a natural channel marketplace data service, the health and wellness beverage market share is 39% of the market. (Spins IFT 2024 “A Thirst for Change” Presentation.) The demand for natural, organic, and sustainable ingredients in beverages continues to grow, driven by consumer preferences and regulatory trends. Poppi rode the wave of the kombucha category, a functional beverage with gut health properties. The founders originally used apple cider vinegar, natural fruit juices, and other ingredients to make a tasty beverage. Poppi’s formula today includes cassava root, organic cane sugar, juices, and stevia, and clocks in 5g total sugars, and 30 calories/12 oz can. Interestingly this mix of ingredients is not 0 calorie, and the sucrose of choice is organic cane sugar, a sweetening ingredient with a “healthy” halo.

The combination of healthier ingredients for the gut, and natural sweeteners seems to strike a chord that consumers are willing to pay for. Poppi charges anywhere from $1.99 - $2.89/can.

Traditionally, the liquid sucrose (beet or cane) used in beverage formulations is water white in line with the International Society for Beverage Technologists (ISBT) specifications. This is a very processed and neutral tasting sweetener. But the natural beverage market is selecting less processed ingredients including, as Poppi shows, sugars like organic sugar. Organic sugar suppliers share specifications up to 1500 ICUMSA. Refined organic typically runs between 400 – 800 ICUMSA (Purelife, Brazilian Sugar).

Besides non-traditional sweetener choices, Poppi also shows 0 calories is not necessary for mainstream approval. Poppi maintains 5 g sugar, and 30 calories. Overall diet soda (0 calorie) holds less than 30% share of the carbonated soft drink category (Statista, 2020). The top growing natural beverages for “hydration” though are 0.5 – 5 g and 15 – 20 g sugar according to Spins. (Spins, Diversification of Hydration Newsletter, August 2024).

Why may a beverage formulator choose cane sugar vs an alternative sweetener like cassava or fruit juices? Primarily, the flavor. Sugar provides a neutral sweet. Some naturally colored sugars may even have a slight enhancement of flavor without the addition of minerals. Sometimes a fruity note is not wanted or needed in a traditional flavored soft drink, so fruit juice does not always make the grade. The mouthfeel from cane sugar is hard to replicate as well. When a formulator has to add other ingredients to replicate a pleasant smooth mouthfeel, they may choose to add sugar back into the formula and stick with a simple ingredient list instead. (Recreating the flavor of sugar without the sugar | Food Business News).

Sugaright L350 is an excellent option for these applications.

We have been asking the beverage industry to change the way they think about sugar for a long time.

And it is.

Want to know more? Join us at BevTech in May!