PepsiCo to launch products through Whole Foods

PepsiCo Inc., the global snacks and soft drink company, is introducing products through Whole Foods Market Inc. stores, targeting the type of consumer who shops at the natural and organic foods seller.

PepsiCo sells a line of chips and has started market tests of a smoothie drink at certain Whole Foods locations. Neither makes any mention of PepsiCo on the labels.

The Purchase, N.Y.-based company declined to say whether other PepsiCo products were being sold through Whole Foods or whether additional ones were planned.

PepsiCo is selling the smoothie drink, Fuelosophy, at Midwest and Northeast Whole Foods locations, introducing a product that could help it capitalize on its growing noncarbonated beverage business. Fuelosophy’s launch comes after a PepsiCo chip line, Sun Snacks, was introduced at Whole Foods stores across the nation early this year and is now sold at most locations, Whole Foods spokeswoman Kate Lowery said.

The initiatives are part of a PepsiCo strategy to diversify its brand portfolio to include a growing number of products targeted at health-conscious consumers.

PepsiCo has also used acquisitions to increase its presence in the healthful-foods category, buying the companies that make Izze sparkling juice drinks, Stacy’s Pita Chips and Mother’s Natural Cereals. All three products were sold in Whole Foods stores before PepsiCo bought them and will continue to be.

Customers of Austin, Texas-based Whole Foods -- which started as a single store in Austin and has grown to 189 locations in the U.S. and Britain -- tend to be early adopters and respond less favorably to mass-marketing techniques, Beverage World Senior Editor Jeff Cioletti said.

Fuelosophy’s website doesn’t include any mention of its parent company. Cioletti said it made sense that PepsiCo had not done a splashy product launch.

“It seems like Pepsi is walking a very fine line,” he said. “Today’s consumers are very, very suspicious of heavy marketing.”

PepsiCo spokeswoman Nicole Bradley said the company was not the first to remove its name from products to target a certain type of consumer. Coca-Cola Co.’s Odwalla smoothie drinks and Kellogg Co.’s Kashi cereal do not bear the names of their parent companies.

“We just decided to use a different model with this brand, a slower approach to let consumers discover it,” Bradley said.

PepsiCo, the second-biggest U.S. soft drink maker after Coca-Cola, also owns the Frito-Lay snacks business and Quaker foods. Its major brands include Gatorade, Tropicana orange juice, Doritos and Fritos.

PepsiCo shares fell $1.14, or 1.8%, to $61.41 on Monday.