Beverage giants Pepsi and Coca-Cola are showing off their mixology skills at the National Restaurant Association Show this year as they look to get in on the growing “craft beverage” movement.
Pepsi was promoting its new Drips by Pepsi program, a pop-up concept that serves plussed-up versions of its classic soft drinks.
Staffers at the Pepsi booth were mixing up Lipton Mango Horchatas with strawberry boba; Starry Zero Sugar Berry Basil with basil seeds; and Pepsi Zero Sugar Forever S’mores, a sweet and smoky concoction featuring coconut, lime, s’mores ingredients and whipped cream.
S'mores and berry-basil flavored-drinks, with Pepsi products as the base.
Pepsi launched Drips last September with a beverage truck pop-up in New York City. The menu currently consists of nine core drinks. The idea is to capture the craft or “dirty soda” trend, in which branded beverages are customized with syrups, mix-ins and other flavors, said Justin Schwarz, senior director of marketing for PepsiCo.
The trend was popularized by emerging beverage brands like Sodalicious and Swig, where systemwide sales rose nearly 50% last year, according to Technomic data. And it is now being embraced by larger chains. Taco Bell recently launched a beverage concept, Live Mas Cafe, and McDonald’s has been testing a beverage brand of its own in CosMc’s.
Colorful, customizable drinks have become particularly popular with Gen Z. They look good on social media, and they fit into “treat culture,” another Gen Z habit. They’re also nonalcoholic, which may resonate with younger people who don’t drink as much alcohol or aren’t of drinking age.
Beverage-focused restaurant concepts in general are booming. Five of the 12 fastest-growing chains on Technomic’s Top 500 restaurant chain ranking specialize in beverages in some form.
So it’s no surprise that a couple of the world’s largest beverage suppliers are getting in on the action.
Orange Fanta cream soda from Coke.
In addition to a series of popups, Drips by Pepsi has a partnership with Regal Cinemas in New York. It’s also making the lineup available to restaurant clients to add to their menus, Schwarz said.
And he did not rule out Pepsi launching Drips as a restaurant concept of its own. “We’re always evaluating different opportunities,” he said, adding that the company will continue to apply lessons learned from Drips pop-ups and other activities.
Coke, meanwhile, was doing some mixology of its own at its booth on the Show floor. It was offering a rotation of 15 “mixologist” beverages, including a creamsicle-like drink made with soft-serve and orange Fanta syrup.
The goal is to help restaurants develop their own beverage limited-time offers (LTOs), which have proven to be a helpful traffic-driver. Data shows that more than 90% of customers will pick one restaurant over another because of an LTO, and that they spend an average of $3 more per trip, said Megan Tallman, VP of Coca-Cola Freestyle and foodservice innovation at the Coca-Cola Company.
Not only that, but beverages tend to be more profitable for restaurants, and premium-priced LTOs even more so.
As part of that effort, Coke plans to launch two new pumpable syrups in its orange Fanta and Barq’s Root Beer flavors that restaurants can use to make creative concoctions. It is testing the syrups with restaurant brands in the fourth quarter and could add more flavors down the road.
Tallman noted that dirty sodas have been around for decades, since the era of the old-fashioned soda fountain. And then Gen Z came along.
“They have actually amplified the trend of dirty sodas and mixology,” she said.
The mixology from the two beverage titans comes amid a boom in beverage-focused restaurant concepts. Five of the 12 fastest-growing chains on Technomic’s 2024 Top 500 restaurant chain ranking specialize in beverages in some form.
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.