Post by : Badri Ariffin

In a significant shift, PepsiCo is revolutionizing its global offerings by implementing a strategy focused on price cuts and product simplification to stimulate growth in a competitive landscape. The company revealed plans to eliminate approximately 20% of its product lineup by early next year, reallocating savings to bolster marketing and enhance consumer value.

Known for iconic brands like Cheetos and Pepsi, the New York-based giant is also accelerating the introduction of new snacks featuring cleaner, functional ingredients. Upcoming products include Protein Doritos and Simply NKD varieties of both Cheetos and Doritos, all devoid of artificial colors and flavors, as well as a prebiotic variant of Pepsi's flagship cola.

This transformation follows pressure from Elliott Investment Management, which invested $4 billion into PepsiCo in September, voicing concerns about slowing growth and profitability in North America, thereby prompting the company to take decisive action.

PepsiCo's new approach encompasses a reassessment of its supply chain, the introduction of more value-oriented products, and a possible infusion of fresh leadership to steer growth. The goal is to achieve organic revenue growth ranging from 2% to 4% by 2026, following a modest 1.5% increase observed in the first nine months of this year.

The initiative also addresses years of increasing prices and shifting consumer preferences that have dampened interest in beverages and snacks. PepsiCo aims to enhance market presence for budget-friendly options like Chester’s and Santitas as part of its response to perceptions of elevated pricing.

As PepsiCo streamlines its portfolio and promotes innovation, the industry remains vigilant to determine if these changes will successfully revitalize sales performance and fortify the company's standing in the evolving consumer marketplace.

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