Dec 09, 2002

Propel Fitness Water from Gatorade First In Category To Surpass $100 Million

Enhanced Water Fastest Growing Segment of Beverage Category

Enhanced water is the fastest growing segment of the beverage category,(1) and market leader Propel Fitness Water last week became the first enhanced water to surpass $100 million in annual sales. Since its national rollout early this year, Propel has claimed nearly 60 percent of all enhanced water category growth at grocery and c-store in 2002(1), clearly placing The Gatorade Company's latest innovation at the forefront of the category explosion.

According to Information Resources, Inc. (IRI), enhanced water sales at grocery and c-store are up 124% year-to-date(1), and sales of Propel Fitness Water have outpaced the competition, with an increase of 193% year-to-date at grocery and c-store.(1)

"The Gatorade Company prides itself in having a thorough understanding of the active-thirst occasion and we developed Propel Fitness Water to provide a better water choice for active people," said Chuck Maniscalco, president of The Gatorade Company. "We know that consumers drink 4.1 billion gallons of beverages per year when they are active and water is the active-thirst beverage selected most often. Leveraging our more than 35 years of hydration expertise, Propel Fitness Water helps us meet the needs of active water drinkers and capture more of the active-thirst pie."

Propel Fitness Water is a lightly flavored water with just 10 calories per eight-ounce serving and vitamins that contribute to an overall healthy lifestyle. Continuing its longstanding commitment to meeting the hydration needs of active people, Gatorade created Propel to help exercisers who drink plain water stay better hydrated and enjoy better workouts. Research shows that active individuals only replace half the amount of fluids they lose when they drink plain water during exercise(2), which can lead to dehydration and a lack of energy. Research also shows that people will drink more of a lightly flavored beverage than plain water and therefore will stay better hydrated.(3)

"Propel is a huge success story because our consumers understand the hydration benefits of Propel and love that it tastes great, has essential vitamins and is low in calories," says Marie Devlin, director of marketing for Propel. "Very few brands reach $100 million in sales their first year, so we're thrilled Propel has reached this milestone so soon."

Currently available in four flavors - Berry, Lemon, Orange and Black Cherry - Propel will debut two new flavors in 2003: Peach and Kiwi-Strawberry. The "Drip" advertising campaign for Propel, featuring dramatic visuals of a variety of athletes encapsulated in giant drops of water dripping from a bottle and splashing onto the ground, has played a key role in the success of Propel, generating substantial awareness and trial for the brand. The :30 second "Drip" spot was created by Element 79 Partners, and new ads will debut next year. In addition, the brand will continue to be supported by a fully integrated marketing campaign, including sampling, public relations, point-of-sale and in-store merchandising.

1 IRI grocery data, ACNielsen c-store data, YTD 10/02.
2 Iuliano, S et al. Int J Sports Nutr 8:10-23, 1998
3 Passe, D.H. et al. Appetite (2000) 35:219-229