- PepsiCo's Mtn Dew brand is releasing its first new permanent flavor in more than a decade: Major Melon. The watermelon-flavored soda is available nationwide in regular and zero-sugar varieties.
- Nicole Portwood, the vice president of marketing for Mtn Dew, said watermelon was the No. 1 choice of the flavors that were tested among fans, and that it evokes "feelings of freedom and nostalgia."
- As soda volume sales have shrunk in the last decade, PepsiCo has looked to alternative avenues to boost its bottom lines. In addition to reducing the size of some of its cans to increase margins, the company has given its Mtn Dew brand a jolt by adding an energy drink line and introducing a sugar-free version of its original soda last year.
Despite declining soda sales overall, the category remains big business for PepsiCo, with its Mtn Dew brand commanding more than 6% share of the market in the United States, according to Statista. Even though the brand remains popular, the carbonated soft drink category has struggled as consumers start to favor functional beverages and startup companies strive to redefine the category with lower-sugar and better-for-you offerings.
To improve the positioning of its Mtn Dew brand, the CPG giant has moved aggressively to expand its reach into health-focused and faster-growing segments like energy drinks. In the past, PepsiCo has used its Mountain Dew platform to brand its energy drinks such as Kickstart, GameFuel and AMP. The company has also tested temporary flavors for Mtn Dew such as its limited-edition Liberty Brew, which has 50 flavors in one bottle. The last permanent flavor was White Out, a citrus-flavored Mtn Dew that appeared in 2010.
A decade after its last permanent flavor release, PepsiCo is launching Major Melon at a time when many companies have streamlined portfolios to favor more popular flavors and products. PepsiCo's Frito-Lay snack division cut about 21% of its SKUs during the peak of the coronavirus outbreak.
Although the pandemic has weighed on PepsiCo and led to a recent stock downgrade, analysts predict consumers will return to pre-pandemic habits, which would mean the reopening of foodservice channels and the subsequent resurgence in demand for PepsiCo soda products. Having an inventive flavor that appeals to consumers' nostalgic notions through a familiar legacy brand may prove to be a good bet for the company. A report last year by snack giant Mondelez found that more than half of consumers are buying nostalgic childhood brands.
Launching a permanent brand is a large investment for PepsiCo, and one that indicates that the company is confident in its choice. When the flavor launch was leaked on Reddit in September, responses showed positive interest in the product.
Although the new Mtn Dew is a soda, the product's marketing invokes the idea of energy with words like "invigorating" and "charged," bringing to mind functional beverages intended to help people power through their day. As 65% of consumers seek functional benefits from their food and drink, PepsiCo is wise to position Major Melon alongside the trends, while maintaining its appeal to the many consumers who remain ardent soda drinkers.