Gatorade Gets A 'Lyte' Overhaul and Laird Goes On A Buying Spree

0:05Monica Watrous:Welcome to the CPG Week podcast by BevNet and Nosh. I'm Monica Watrous, here with my co-host, Lukas Southard. If you're enjoying the show, please subscribe on your listening platform of choice. Now here is the latest in food and beverage industry news. Gatorade is getting aglow up. The Pepsi-owned hydration brand will transition to new packaging and add innovation as it seeks to pivot from its traditional association with elite athletes to bring in a broader audience. Billed as a, quote, transformational new era for the sports drink category leader, Gatorade's new strategy will see it target the more than 150 million Americans who report feelings of mild or moderate dehydration every week.

0:51I am one of them.

0:52Monica Watrous:Gatorade products will be reorganized under a new portfolio structure, the Gatorade Advanced Hydration System, tied to specific messaging around use occasions. Most lines, including Thirst Quencher, Gatorade Zero, and the recently introduced Gatorade Lower Sugar, are grouped under Hydrates Better, while Gator Light is centered on Hydrates Faster. The third pillar, Hydrates Longer, will include a brand new product, Gatorlite Longer Lasting, expected for soft launch later this year before national rollout in 2027. That line will feature a first-to-market proprietary electrolyte blend designed to help users retain fluids over longer periods of time.

1:38Monica Watrous:The brand is also continuing to make progress on its efforts to move away from artificial colors. These changes were announced during PepsiCo's first quarter earnings last week. The company reported overall net revenue up 8.5 % during the period, benefiting from price reductions and restaging core brands across its portfolio. On the food side, a major through line is PepsiCo's push into what it calls a$2 billion plus permissible portfolio of better-for-you snacks focused on protein and fiber or featuring expanded use of avocado oil, olive oil, and whole grains. Executives noted that Sun Chips, Siete, and Quaker rice cakes each gained share during the quarter and delivered strong volume and net revenue growth.

2:26Monica Watrous:The strategy aligns with broader industry tailwinds surrounding eating habits shaped by weight loss medications and, quote, maxing on key nutrients. Looking ahead, the company plans to refresh its Tostitos and Quaker brands with, quote, new visuals, amplified communications, and simple ingredients. Laird Superfood, the publicly traded functional wellness brand founded by former professional pro surfer Laird Hamilton and his Olympic volleyball player wife, Gabby Hamilton, announced the acquisition of its second business in less than six months. Laird has acquired vertically integrated wellness product platform Terasol Superfoods for$48 million.

3:11The deal was funded by a$60 million private placement from affiliates of Nexus Capital Management. Nexus had previously committed to the investment in Laird when the wellness brand closed the acquisition of Navitas Organics last month. Nexus now holds a 71 % stake in Laird. Similar to Laird, which makes functional coffee creamers, instant coffee, hydration powders, and other products using adaptogenic mushrooms, both Navitas and Terasol use superfood ingredients to make wellness products in categories ranging from snack mixes and protein bites to powders and ingredients for baking or cooking. What's most striking about both the Terasol and Navitas deals is that it signals a significant shift in Laird's strategy over the last few years.

4:02If we take a trip back in time, Laird went public in 2020, but it didn't begin to struggle until late 2021 after it acquired snack brand Picky Bars. Though Picky did not end up being a good fit and was discontinued last year, it was not the main cause of Laird's troubles. A change in the Apple iOS platform significantly impacted the company's e-commerce acquisition strategy, along with Laird owning its own manufacturing facility, were some of the biggest strains on the business. To reduce the heavy losses reported in quarterly earnings calls throughout 2022 and 2023, Laird closed its Oregon production plant, instituted heavy skew rationalization, and focused resources on staying lean by prioritizing its e-commerce business and distribution in key retailers like Whole Foods.

4:56Now, with this partnership in place with Nexus Capital, it seems that Laird is back to building a big wellness business. It doesn't hurt to have the support of a large investment firm directing Laird's growth strategy, but there is a case to be made that Laird is returning to a similar framework that caused previous struggles, i.e. acquisitions of similarly positioned businesses and vertical integration in its manufacturing. It's still too early to draw many conclusions, but looking at Laird's full-year 2025 earnings reported last month, net losses were back up year over year and gross margin had contracted.

5:36That being said, net sales were up 15 % in Q4 and adjusted EBITDA was also elevated year over year. So we'll continue to track Laird's move into a broader wellness platform on BevNet and NOSH.

5:56Monica Watrous:GLP-1 drugs aren't just changing how consumers eat. They're reshaping how they engage with wellness overall, creating meaningful opportunities for packaged food brands. New research from sales and marketing company Acosta Group suggests the medications are accelerating behaviors that were already bubbling up, especially among Gen Z and millennials, and moving them toward mainstream faster than expected. Higher protein, more fiber, smaller portions, cleaner labels, and functional benefits are becoming the baseline. Over 12 % of Americans have taken GLP-1 drugs marketed under such labels as Ozempic, Wagovi, Manjaro, and Zepbound, and nearly 6 % are still taking them for a recent Gallup poll.

6:44Monica Watrous:GLP-1 users are retooling their grocery carts in predictable ways with more fresh produce, yogurt, lean protein, shakes, and bars. And at the same time, they are dialing back sweets, salty snacks, and sugary drinks. But the bigger signal is how they think about food. A significant portion of GLP-1 consumers say they feel better about their diets, and those habits and attitudes are influencing the rest of the household. GLP-1 consumers report increased confidence and improved perceptions related to physical appearance. That mindset is spilling into adjacent categories, particularly beauty and personal care, where shoppers are increasingly looking for specific functional benefits like hydration, skin elasticity, and thinning hair solutions.

7:31Monica Watrous:This shift is paving the way for packaged food products that are positioned as part of a system rather than a standalone snack with messaging that leans into outcomes such as energy, satiety, gut health, and even beauty benefits. We've been reporting on the burgeoning trend of ingestible beauty for a while, and recent product launches underscore that momentum. Fermented Foods brand Cleveland Kitchen unveiled Korean coleslaw featuring a probiotic strain that has been clinically studied for gut and skin benefits. While Purely Elizabeth launched Purely Glow salted vanilla pistachio granola, enhanced with collagen peptides and biotin.

8:11Monica Watrous:Dining habits are also evolving, though not necessarily shrinking. For packaged food brands, this means portion-controlled formats are gaining importance and satiety per calorie is becoming a key selling point. Brands like Lentiful and Kanzin Meal are tapping into the notion of nutrient-dense micro meals designed for more efficient eating occasions. This report was really interesting to me, Monica, because we're seeing the conversation shift around how GLPs are impacting the broader CPG industry. It feels like yesterday, but it was almost two years ago that I reported on how major food companies were worried that sales would be dramatically impacted by GLP-1 users.

8:55While that doesn't seem to have been the case, there has been a definite tone change in how brands are marketing around GLP-1s. And I think this kind of package idea is something I've heard from a variety of brands.

9:08Monica Watrous:Yeah, well, an important note in the Acosta report is that products that are marketed as GLP-1 friendly can be polarizing. And consumers may see these products and question their nutrition and taste and applicability. Insiders can learn more takeaways and insights from that report at nosh.com. GLP-1s might be affecting the packaged food industry, just as hemp continues to impact the functional non-alcoholic beverage category. While not directly linked to the 420 holiday this week, there was some interesting developments in the intoxicating hemp space last week. Long-time supporter of the hemp industry, Kentucky Senator Rand Paul, announced he is introducing legislation that will allow states to, quote, opt out of the November 13th ban on hemp-derived THC products.

10:10The proposed bill is co-sponsored by Minnesota Senator Amy Klobuchar and Iowa Senator Joni Ernst and would allow states and tribal nations to determine if and how intoxicating hemp products would be sold and regulated within their borders. The Paul bill is just the latest in a series of potential legislative solutions that have circulated Capitol Hill since hemp's future was put in jeopardy last November. as part of the appropriations bill that would make most hemp food and beverage products illegal to sell. Industry groups and stakeholders have been lobbying lawmakers in both houses of Congress since November to find a solution, but as we stand now in mid-April, nothing seems to have really broken through.

11:01I recently talked to many stakeholders in the hemp category for a BevNet magazine feature to hear how these various industry leaders are preparing for the various outcomes that could happen between now and November. From the brand perspective, many brands are diversifying out of the category in ways to protect themselves from the uncertainty surrounding the set. Drink Hippie is a prime example. While the brand launched Hippie Water as an alcohol alternative beverage using hemp-derived THC, it has discontinued that line in favor of a women-positioned energy line, Hippie Energy, and its newly launched coffee concentrate, Hippie Brew.

11:52So lots of hippie stuff. Other established brands are seizing on the opportunity by expanding further into the space and quietly formulating off-ramps with uninfused beverage varieties or even shifting distribution potentially to the regulated cannabis channel if the November ban goes into effect. You can read the full magazine feature on BevNet to learn what beverage distributors and retailers are doing to safeguard their businesses as the countdown clock to November continues.

12:25Monica Watrous:Drink them if you got them. And I am. Be sure I am. Same. Here are some other notable bits of news from the week. As part of ongoing efforts to strengthen its balance sheet, Simply Good Foods, the parent company of Quest, Owen, and Atkins, announced plans to shrink its workforce by nearly 15%. Walmart unveiled redesigned packaging across its great value private brand that introduces a, quote, modern visual identity and consistent placement of nutritional claims. And finally, Sazerac has made an approximately$15 billion bid to buy Jack Daniel's maker Brown Foreman. For these stories and more, become an insider at BevNet and Nosh.

13:14Monica Watrous:that wraps up this edition of cpg week by bevna and nosh thank you to our audio engineer joshua pratt our director is mike schneider and our designer is aaron willette if you enjoyed the podcast please subscribe on your listening platform of choice and we will see you next time