PepsiCo is in talks to acquire the popular beverage brand Poppi, a low-sugar drink with added prebiotics, probiotics, and fiber. The purchase price in the negotiations exceeds $1.5 billion. The category of 'functional beverages,' like Poppi, has been on the rise in recent years, especially compared to standard sodas. These drinks are marketed as low in sugar and include ingredients that promote digestive health under the slogan 'Be Gut Happy.'
Poppi, based in Austin, was founded by Allison Ellsworth and Stephen Ellsworth. PepsiCo had planned to launch its own functional beverage under the Soulboost brand but decided to discontinue that project upon realizing it would not succeed. The potential acquisition of Poppi would be part of PepsiCo's strategy to enter the healthier beverage market.
Regarding the perception of the health of the Poppi drink, some consumers have expressed doubts about the supposed benefits it promises. A class-action lawsuit in the U.S. District Court in San Francisco, filed by a consumer named Kristin Cobbs, questions the amount of prebiotic fiber present in Poppi. Cobbs claims that the drink contains an insufficient amount of prebiotic agave inulin fiber to provide any true benefit. The soda brand has responded to these allegations by calling them unfounded and assuring that they will vigorously defend themselves.
Despite these criticisms, sales of prebiotic and probiotic beverages in the United States have tripled in 2024, according to data from consultancy AlixPartners. PepsiCo, seeking to capitalize on this trend, is in the process of acquiring the Poppi brand as part of its efforts to diversify its portfolio with healthier products. Other brands have also ventured into the functional beverage market, such as Coca-Cola with its Simply Pop drink.
