Dr Pepper/Seven Up (DPSU) convenes 1150 bottlers, employees and guests in San Antonio TX for 7UP bottler meeting September 14-16. Company says reformulated 7UP (BD 9/8/97) -- called "enhanced" and "best ever" by executives -- debuts in January 1998 with expectations of +4% volume growth. Executives dispel analogies to "New Coke." DPSU CEO Todd Stitzer declares outright: "Best ever 7UP is not New Coke." 7UP ad budget up +25% for 1998; new ads focus on product's refreshment attribute. Tagline: "Crisp, Clear Refreshing Taste." Mike McGrath, COO of DPSU's Cadbury Beverages/7UP unit, says revamped 7UP "not a taste change, not new, not sweeter ... There has been no major formula change." Notes: "Loyal users said, 'don't mess with it.' We've just enhanced it." Adds: "Loyal, older and younger users all prefer enhanced version." Asked if it's similar to Sprite, McGrath says "dissimilarity is startling." In change re media spending, DPSU says bottlers will pay 25% of national media; promises 7UP concentrate costs -- in past higher than Sprite -- will be at parity in 1998. McGrath also says future national 7UP bottler meetings and performance trips will be held every other year, no longer annually. Caffeine. Separately, McGrath tells BD company researches caffeinated lemon-lime product for possible future use.

Stitzer. In 1st meeting at helm of DPSU, CEO traces 2-year "mission to revitalize" 7UP. Tells bottlers 2 years of research "produced (formula for) 'Best ever' 7UP." Explains: "Our aim is not to mimic Sprite, as New Coke did with Pepsi." Says Sprite "is limey and sweet. 7UP is a blend of lemon and lime ... Sweetness and carbonation levels have not changed." Declares "soft drink business is a collision sport." In strong, dramatic speech conclusion, Stitzer declares: "We're looking for all of you to stand with us ... We're looking for people who will dare greatly."

Brock. Cadbury Schweppes global beverage CEO tells bottlers, employees: "I'm damn proud of you. You're terrific." Declares: "7UP is back. It was unloved, uncared for and mismanaged. That's no longer the case." Adds: "7UP's prospects for 1998 are bigger and better than they have been ... I expect to see (volume) growth of +4% or more." Notes: "There is no plan to sell, there is no plan to divest 7UP."

Product/packaging. Kim Feil, senior vp marketing Cadbury/7UP, says 7UP "recrafted with new technology ... changes are subtle." Notes "younger consumers respond most positively to message that 7UP is a lemon-lime product." Company drops "uncola" theme. Feil explains preservative EDTA added to enhance shelf life. New packaging graphics -- super-imposing lemon/lime image over 7UP's traditional red dot, plus adding yellow outline to splash design -- debut no later than 1/26/98. Says bottlers "can't use new concentrate until then," as new packaging's ingredient panel contains EDTA reference. Previous formula change. 7UP last reformulated in 1950, when lithium citrate removed. New Splash packages. Executive says DPSU "now working on" 1-liter PET version of Splash bottle for 7UP, other Cadbury brands. Says 6-packs and 8-packs available.

Marketing/advertising. McGrath says "now that we're competitive on concentrate, we need to be competitive on media." Notes: "We're moving to co-op spending on national media" paid 25% by bottlers, 75% by DPSU. Adds: "'Up Thing' campaign (launched in early 1996) well received, but ads require younger focus and more humor." Says new ads target 18-24 year olds more heavily. McGrath tells BD: "When we decided to launch reformulated 7UP, we decided to focus on product ads. We'll meet with Young & Rubicam over next few months to look at long-term ad strategy for 18-24 year olds." Ahead. In 1st half 1998, DPSU undertakes "major sampling" for 7UP via several programs. Feil says more focus on ethnic segmentation "on the docket" for 1999.

Equipment incentives. John Tomescko, senior vp sales Cadbury/7UP, says 7 bottlers signed on for 5-year cold bottle/vending equipment co-investment plan announced late 1996 (BD 11/8/96); will place 7000 new pieces of equipment. New programs. DPSU offers 34-38% support for vendors purchased for 1998. Also offers 46% support if bottler signs on 3-year plan; 54% support for 5-year plan.

Other brand/product news. Crystal Light. Company debuts new graphics 4/98 "to tie brand better to powdered version." Also evaluates prices/packages. Executive: "Strategy of selling 16-oz Crystal Light at premium (price) to 20-oz soft drinks has been a challenge." Launch of Crystal Light tea "disappointing." Sunkist. New graphics -- showing logotype against splash/sun design -- debut 2/98. Squirt. New ads/promotions utilize tagline, "Squirt Your Thirst." Caffeine. With bottlers speculating on possible future caffeinated version of 7UP, BD asks McGrath: is caffeine in 7UP's future? McGrath: "We are researching a caffeinated lemon-lime product for possible use sometime in the future. We're always exploring new product possibilities." Notes 2 of fastest-growing CSD brands -- Mt Dew and Dr Pepper -- "are caffeinated with targeted focus on 18-24 year olds." Bottler: "They weighed caffeine for 7UP, but didn't do it. They still have caffeine under consideration for the future."

Numbers. Tomescko notes 1996-97 Coke/Pepsi system delistings involved 75 mil cases of DPSU brands; 44 mil cases successfully transferred. Volume. Executives report 7UP bottle/can volume down -1.4% through 7/97; fountain flat; overall down -1.3%. Grocery channel represents 60% of total 7UP volume; all other market 26%; fountain 10%.

Bottler views. 7UP bottlers generally positive on reformulated 7UP, some worry: 1) "We need something like this." 2) "Product is good, graphics are good, it's not sweeter, I'm for it." 3) "New taste is fine, but the problem has been with the marketing. They have to get that right." 4) "It tastes like Sprite. We should differentiate ourselves, not me-too Sprite." 5) "I'll buy into this, I'm all for it." 6) "They've been working on this for 2 years, why are they waiting till January (for launch)?" 7) "Sprite's been killing us, the product had to be changed. This will also give us some news." 8) "Maybe this plus the launch of Surge will dent Sprite." 9) "I'm real worried. I sell a lot of 7UP, and no one complains about the flavor." 10) "Asking the bottlers to pay 25% (of national media) is a lot of money." 11) "Stitzer gets better at each bottler meeting."

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