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PepsiCo’s Faby Torres on How the CPG Giant Invests in the Energy Drinks Opportunity

Over the past few years, PepsiCo has reshuffled its portfolio to focus on healthier beverages, including the high-growth energy drinks market. Portada interviewed Fabiola ("Faby") Torres, SVP, CMO Energy Drinks / Hispanic Business Unit, PepsiCo, to understand how the CPG giant continues to invest in the energy drink market opportunity.

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Energy Drink Marketing: Over the past few years, PepsiCo has reshuffled its portfolio to focus on healthier beverages, including the high-growth energy drinks market. Portada interviewed Fabiola (“Faby”) Torres, SVP, CMO Energy Drinks / Hispanic Business Unit, PepsiCo, to understand how the CPG giant invests in the energy drink market opportunity.

The global energy drinks market is projected to grow at a compound annual rate of 8.1% through 2030 from US $75.85 billion in 2020 to US $ 149.7 billion in 2030, due to consumers’ increasing focus on wellness, endurance, and alertness, according to Acumen Research and Consulting.

PepsiCo’s CMO for Energy Drinks, Fabiola Torres, tells Portada that “the energy category holistically continues to experience rapid growth and is ever-changing. Brands must break through with their audiences by reaching them engagingly and authentically while continuing to innovate to match their needs and desires. We believe today’s consumers will continue demonstrating loyalty to our brand and connecting with them authentically by reaching them through their core passion points.”

The energy category holistically continues to experience rapid growth and is ever-changing.

PepsiCo is a major player in the global energy drink market, where it owns brands including Amp Energy, Rockstar Energy, Cool Attitudes, Gatorade, and Starbucks (PepsiCo has a partnership with Starbucks for energy drinks and coffee marketing). In addition, in August 2022, PepsiCo and performance energy drink brand Celsius struck a long-term distribution deal. Celsius’s Q1 2023 financial results already showed how quickly it has benefited from its distribution deal with PepsiCo; the company is now the third-largest energy drink company in the U.S. with a 7.5% market share, and “its partnership with PepsiCo is expected to drive further growth,” according to an article by equity analyst Geoffrey Seiler on the website seekingalpha.com.

Rockstar Energy: How to Market Energy Drinks

Sports & energy brands — which include Gatorade, Rockstar Energy, and Bang Energy — are now a big part of PepsiCo’s growth trajectory.  In March 2020, PepsiCo acquired Rockstar Energy Drinks for US $3.85 billion. In 2020, Rockstar had a 10% market share of the global energy drink market, the third-highest after Red Bull and Monster Energy. At a recent  Portada brand marketer event, Torres stated that PepsiCo’s Energy Drink portfolio’s marketing revolves around connecting with the consumer through the passion points of sports, music, and gaming. Asked about how she will be activating around each passion point from now on for the Rockstar Energy brand portfolio, Torres answers that “Rockstar Energy is a brand born through consumer culture and anchored to sports, music, and gaming – core passion points of our Gen Z and Millennial fans. Moving forward, we’ll continue to strive to seamlessly integrate into their lives and passions as that connection continues to help us drive affinity and develop a long-term relationship with them. We look forward to showcasing our plans for 2024 and beyond around each of these core brand tenants.”

Rockstar Energy is a brand born through consumer culture and anchored to sports, music, and gaming – core passion points of our Gen Z and Millennial fans.

Energy Drink Marketing to Hispanics 

Fabiola Torres, SVP, CMO Energy Drinks / Hispanic Business Unit, PepsiCo
Fabiola Torres, SVP, CMO Energy Drinks / Hispanic Business Unit, PepsiCo

The U.S. Hispanic market plays an important role in PepsiCo’s overall marketing strategy, as Antonio Escalona, SVP and general manager of the Hispanic business unit for PepsiCo Foods North America, told Portada in a recent interview. How does PepsiCo market energy drinks to this important constituency?  “Our Hispanic consumers display a big affinity with Rockstar Energy and consume and appreciate the functionality of energy drinks overall. Like our wider audience, they are passionate about sports, music, and gaming, but there are certain considerations in marketing to the audience, notably the need for all brand campaigns to convey relevance, purpose, and authenticity with the community,” Torres notes.

Regarding particular factors energy drink marketers need to consider when marketing to Hispanics, Torres asserts that “Hispanics increasingly value and take pride in their cultural differentiators and familial identity, and savvy brands are responding by championing them. The Hispanic label covers a diverse cross-section of consumers – a multi-racial group with varied roots – who increasingly expect brands to speak to their distinct cultural passion points. Brands and creators that craft nuanced, true-to-life, and empowering depictions of their version of their lives and family will win audiences.”

In its latest earnings report, published on July 12, 2023, PepsiCo reiterated its commitment to prioritizing low or non-sugar formulations, which it says is in response to the latest consumer preferences. According to the company, sales of non-sugar drinks are quickly outpacing PepsiCo’s traditional soda segment. Despite inflation impacting commodities’ prices, the conglomerate said demand for its drinks and snacks remained strong in the past few months. PepsiCo.’s year-over-year net sales jumped by 5% to US $20.23 billion.

Hispanics increasingly value and take pride in their cultural differentiators and familial identity, and savvy brands are responding by championing them.

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