Approach

As part of our pep+ (PepsiCo Positive) ambition, our aim is to reduce added sugars across our beverage portfolio and offer more Positive Choices for consumers. The approach we take varies from market-to-market and brand-to-brand, reflecting differences in consumer expectations and regulatory requirements. We therefore tailor our strategy to meet the needs of local markets and consumers.

We have set a goal to achieve 100 Calories or fewer from added sugars per 12 fluid ounce serving in at least 67% of our beverage portfolio by sales volume by 2025. Our goal is designed to shift a significant portion of our beverage portfolio towards lower added sugars levels that will help consumers to follow dietary recommendations. We are doing this by expanding our portfolio of zero- and lower-sugar beverages across the world.

Our two-pronged strategy to accomplish this is based on reformulating our existing beverages to reduce added sugars and innovating to develop new products that are significantly lower added sugars.

Progress

For several of our core global brands, we are expanding the number of markets in which our zero- and lower-sugar beverages are available. In 2021, Pepsi Zero Sugar (known as Pepsi Black or Pepsi MAX in international markets) was available in 118 markets, an increase from 28 in 2015.

We continued our reformulation journey in 2021, replacing full-sugar beverages with lower-sugar formulations in 16 new markets. For Pepsi, we reformulated in 10 new markets, and continued the push in Mexico, which reached 100% reformulation in 2021. Since 2016, we have reformulated products, including 7UP, Mountain Dew, and Mirinda recipes with 30-50% less added sugars, in 46 countries, with plans to continue in 2022.

We are also developing new beverages across product categories to meet our added sugars reduction goal. For example, we launched bubly - a line of zero sugar flavored sparkling water - in the United States, and expanded PepsiCo flavored soda mixes for SodaStream in the Nordic countries, France, Germany, and Australia. In the tea category, we continue to develop a lower sugars portfolio including Pure Leaf Unsweetened in the United States and an expansion of Lipton Zero into the European market.

PepsiCo’s 2020 acquisition of Pioneer Foods brought approximately 13 new beverage brands into the PepsiCo fold, slightly aiding progress against our sugar product goals.

By the end of 2021, 53% of our beverage sales volume in our Top 26 global markets was in line with our goal of providing 100 Calories or fewer from added sugars per 12-ounce serving. This is an improvement from 48% at the end of 2020. Our global progress is based on our Top 26 Beverage markets, which represent 79% of our global beverage volume as of 2021.

Strategic partnerships

We have also formed an agreement with Partnership for a Healthier America (PHA), an organization that works with the private sector to help improve the health of youth in the United States by addressing childhood obesity, to conduct an independent review of our progress against our added sugars goal.

The first year of this review was conducted in relation to 2016 data. Most recently, this review looked at then-current 2020 SKU level data of products in our Top 26 global markets and confirmed the accuracy of our calculations and the reliability of the methodology. We plan to continue to partner to execute independent reviews of our data analysis and reporting in order to drive transparency around this important goal.

What's next?

As we continue to pursue our added sugars reduction goal, we expect to focus on the following priorities to further transform our portfolio:

• Further reformulation of core carbonated soft drinks.
• Acceleration and expansion of our no- and low-sugar portfolio, including new flavors of Pepsi Black/MAX, 7up Free, and Lipton Zero.
• Further geographic expansion of PepsiCo no- and low-sugar flavored soda mixes.
• Introduction of additional no- and low-sugar product innovations.

PepsiCo anticipates that efforts will continue unabated within the beverage industry to improve the nutritional quality of products and to support consumers in making Positive Choices.