War On Sugar Heightens As Coke and Pepsi Repositions Zero-Calorie Sodas

Canada became the latest Coca-Cola market to embrace Coke Zero’s re-branding to Coke Zero Sugar. Interestingly enough, Pepsi Max was reintroduced as Pepsi Zero Sugar in the U.S. market earlier this year. Since both products are named “Zero Sugar”, can they co-exist in the same geography without trademark infringement? Equally important, why has each company waited until now to respond and rebrand, given sugar has been a hot industry topic for the past several years?

It may only be a matter of time before Pepsi Max becomes Pepsi Zero Sugar in Canada, and similarly for Coke Zero to rebrand as Coke Zero Sugar in many more markets. In June 2016, the U.S. Patent Office granted Coca-Cola the right to trademark “zero” while also permitting others (primarily Dr Pepper Snapple Group who defended its right to also use this term) to also trademark their beverages with the term “zero”. Coca-Cola argued that other drinks with the “zero” moniker dilutes Coke Zero’s equity and confuses consumers. The panel concluded that the full brand name (ie Coke Zero) rather than “zero” alone serves as adequate distinctive to avoid confusion. While Coke Zero Sugar and Pepsi Zero Sugar could very well create confusion, this trademark precedent implies co-existence is possible. Rebranding each zero calorie soda may be a localized decision based on how much each market’s consumers also know that the product is sugar free.

Coca-Cola and Pepsi postponed renaming their respective sodas until other more viable options were considered. Both companies have experimented with communication and formulas to reduce caloric intake with mixed results. Diet Coke introduced a campaign to talk up the safety of aspartame. Diet Pepsi launched a sucralose-sweetened formula that faced backlash from consumers. Coke Zero and Pepsi Max refreshed packaging and communication to broaden appeal for consumers concerned with trading off calories for real cola taste. It seems only recently that proprietary research concluded that very few consumers were aware that the soft drink contained zero sugar – only zero calories. So each company pivots to amplify messaging that their soft drink contains no calories and no sugar.

If history serves as evidence, then this likely won’t be the last time Coca-Cola and Pepsi tweak their respective soft drinks. Health trends and research suggest that “zero sugar” has the most relevance right now. Previously, “zero” was sufficient. Will “sugar-free” regain popularity? Or new terms like “no sugar”? Only time will tell if this communication is the most effective to combat sugar intake in colas.

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