NEW YORK (
(PEP - Get Report) Global Beverages Chief Massimo D'Amore -- the same man who greenlighted Tropicana's disastrous rebranding (as a result, driving Pepsi's customers to
(KO - Get Report) Simply Orange) -- is trumpeting a new strategy:
Water down the orange juice and charge for it.
themselves add water before drinking OJ,"
D'Amore said in an interview with Bloomberg. "So why not add the water ourselves and charge for it?"
|Inspired by the success of Trop50, Pepsi seeks to expand juice blends that contain more water, less juice.
But even more mind-boggling than the above statement is this D'Amore gem: "We have lost perspective here on the primary reason we are in business, which is to make money."
D'Amore is right about one thing: Pepsi has indeed lost perspective if the company believes that "innovation" amounts to hoodwinking its customers. Steve Jobs would agree with me:
"My passion has been to build an enduring company where people were motivated to make great products,"
Jobs told his biographer, Walter Isaacson
he products, not the profits, were the motivation.
John Sculley, a former president of Pepsi
flipped these priorities to where the goal was to make money. It's a subtle difference, but it ends up meaning everything."
Marketing is a powerful tool, and if Pepsi were so inclined, the company could probably tout that its new juice blends are
enhanced with the purity of Aquafina
revealed to be nothing more than tap water
). But on a long enough timeline, I'm confident that
Pepsi's strategy will dilute the Tropicana brand
the same as they are diluting their orange juice.
Today, Coca-Cola has an opportunity to steal market share from its competitor. The company's Simply Orange brand also uses orange juice blends, but these blends are 100% juice. So here's the ad campaign that I propose for Coca-Cola:
: An orange rests on a stool beside
Raymond Joseph Teller
(of Penn & Teller fame).
: We let our oranges do the talking -- Simply Orange, 100% juice.
-- Written by John DeFeo in New York
MORE FROM JOHN DEFEO:
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts