PepsiCo Eyes Functional Beverage Boom with Stake in Poppi
PepsiCo has taken a minority stake in prebiotic soda brand Poppi, signaling a strategic push into the growing functional beverage segment. The deal, reportedly valued at around $50 million, underscores the increasing consumer demand for gut-health-focused drinks and reinforces PepsiCo’s effort to diversify beyond traditional carbonated soft drinks.
Capitalizing on the Prebiotic Trend
Poppi, known for its apple cider vinegar-infused sodas, has gained traction among health-conscious consumers seeking alternatives to sugary soft drinks. The brand has seen rapid growth, with estimated 2023 sales of $100 million, boosted by strong retail presence and viral marketing on social media. Positioned as a better-for-you soda with digestive health benefits, Poppi is tapping into the rising consumer interest in functional beverages.
PepsiCo’s investment follows a trend of major beverage players expanding their portfolios to meet shifting consumer preferences. Functional beverages, particularly those promoting digestive health and immune support, have witnessed steady growth as shoppers seek products that offer more than just refreshment.
PepsiCo’s Continued Focus on Innovation
The partnership aligns with PepsiCo’s broader strategy to invest in health-forward brands. The company previously backed Poppi through its Nutrition Greenhouse program and later included the brand in its venture arm, PepsiCo Ventures Group. This latest investment deepens PepsiCo’s commitment to fostering emerging brands that align with the evolving health and wellness space.
The move also reflects growing competition in the functional beverage category. Rival Coca-Cola made similar investments in brands like Health-Ade Kombucha, highlighting how major beverage companies are betting on gut-health drinks to drive future growth.
Retail Expansion and Market Implications
With support from PepsiCo, Poppi is expected to strengthen its presence in mainstream retail and expand distribution channels. The investment could also provide operational advantages, including scaling production and enhancing marketing efforts.
For the broader FMCG landscape, this signals growing interest from major players in small but fast-growing health-focused brands. Functional beverages represent an evolving battleground where legacy companies and startups compete to capture consumer demand for drinks that offer added health benefits.
As PepsiCo deepens its stake in Poppi, industry analysts will be watching closely to see how this