Coke and Pepsi Remove BVO; Prove the Power of Protests

The Coca-Cola Company (NYSE: KO  ) and PepsiCo, Inc (NYSE: PEP  )  recently announced plans to remove a controversial additive from all of their beverages. Regardless of what the official statements say, the companies made this move due to consumer outrage started with an online petition. And consumer pressure has altered more than the beverage industry. How has public pressure altered products from McDonald's Corporation (NYSE: MCD  )  and Johnson & Johnson (NYSE: JNJ  )  in recent years?   

Source: Coca-Cola

Ingredient pushbacks usually start with online campaigns that gain steam across social networking sites. Coke and Pepsi's controversial ingredient -- brominated vegetable oil, or BVO -- was the target of an online petition from a college student that gained over 200,000 signatures. And Yum! Brands (NYSE: YUM  ) chain Taco Bell's revelation that its beef is only 88% beef forced the company to quickly offer an explanation as the news spread across Facebook like wildfire.

The controversial ingredients have approval from the Food and Drug Administration and often no solid scientific evidence exists showing that the ingredient is harmful. But public perception that products could prove unsafe is enough to threaten sales. And that's not a risk many companies are willing to take. 

Here are some recent ways the power of the people has changed ingredient labels over the past few years. 

1. McDonald's "pink slime" 

The cause de jour in 2012 was boneless lean beef trimmings, which was quickly nicknamed "pink slime" due to its rather unappetizing appearance. This ground beef filler was made by mechanically separating fat from beef trimmings and then treating the remaining product with ammonia gas to kill bacteria. The cause was championed by celebrity chef Jamie Oliver and came to a head when ABC News ran a program that spring detailing the production of pink slime and its prevalence in commercially available beef.

Source: McDonald's

Grocery stores and beef producers went on the defensive. But on the restaurant side, McDonald's ended up in consumer crosshairs.

McDonald's issued a statement that the company would phase pink slime out of its meat products. Competitor Wendy's took the chance to gloat that its own meat had never contained pink slime. It was another in a long line of questions about McDonald's menu quality, including those raised in the documentary Super Size Me.  

The pink slime controversy has left consumers wary about beef additives. And that recently forced Taco Bell to offer a quick explanation when the percentage of its beef started spreading on social media. 

Taco Bell created a website that outlines each beef additive, including its source and the role it plays in the meat. Explaining that most of the ingredients were preservatives or flavoring agents seemed to mollify the stirring outrage.

But most companies can't shake off the controversy without a few tears; just ask the next entrant on this list.    

2.  JNJ removes formaldehyde from baby products 

Earlier this year, Johnson & Johnson told the New York Times that its baby products are now free of the controversial chemicals formaldehyde and 1,4-dioxane. Consumer complaints about the ingredients earned notice a couple of years ago, but it took the company until the end of last year to finish changing the ingredients on its more than 100 baby products. The company also promised to remove these and additional chemicals from all of its consumer products before the end of next year. 

And the Johnson & Johnson pushback shows the perceptiveness of consumers. Formaldehyde and 1,4-dioxane don't appear on the labels for those products because the chemicals were by-products of listed ingredients. But consumers and environmental groups still picked up on the presence and demanded their removal.

So companies feel added pressure to remove controversial ingredients that do actually appear on the label.  

3. Pepsi, Coke remove BVO 

Source: Pepsi

Coke and Pepsi announced earlier this month that BVO is being phased out of all products. BVO has a patent as a flame retardant and its use isn't allowed for food use in the majority of Europe and parts of Asia. Domestically, BVO typically appears on the labels of citrus-flavored drinks, where it acts as an emulsifier. 

Pepsi had promised last year that the company would remove BVO from Gatorade. And Coke stepped up this month to remove the ingredient from its competiing Powerade products. Then both companies went a step further and announced plans to become BVO-free. The change will pertain to several drinks, including Pepsi's Mountain Dew and Coke's Fanta.  

Foolish final thoughts 

The power of the people -- and their spending dollars -- have continued to change the ingredients of everyday products. Businesses are willing to spend big money to reformulate products if the end results are more sales and a reputation as a healthier company. 

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 28, 2014, at 3:15 PM, statusQuo wrote:

    BVO is being eliminated due to "Consumer Outrage"?? Are "the outraged" the actual customers?

    I smell "New Coke".

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10/21/2014 4:00 PM
KO $40.68 Down -2.61 -6.03%
Coca-Cola CAPS Rating: ****
PEP $93.73 Up +0.18 +0.19%
PepsiCo CAPS Rating: ****
JNJ $100.36 Up +1.16 +1.17%
Johnson & Johnson CAPS Rating: ****
MCD $91.01 Down -0.58 -0.63%
McDonald's CAPS Rating: ***
YUM $69.80 Up +0.67 +0.97%
Yum! Brands CAPS Rating: ****

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