Major Food Companies Rebrand Amid Rise of GLP-1 Weight Loss Drugs

Global food and beverage giants are undergoing significant rebranding as appetite-suppressing GLP-1 drugs reshape consumer demand in the United States. Companies such as PepsiCo and Coca-Cola are focusing on shorter ingredient lists and smaller package sizes in response to a growing number of Americans using these medications for weight management. According to data from LSEG, nearly three dozen companies outside the healthcare sector have acknowledged the impact of GLP-1 drugs or weight loss during their earnings calls this year, up from just 14 in the same period last year and a mere five two years ago.

As awareness and adoption of GLP-1 drugs increases, they are projected to cause a shift in consumer behavior that could result in up to US$12 billion in lost snack sales over the next decade, as estimated by EY-Parthenon. The uptake of these medications, primarily prescribed for diabetes and weight management, more than doubled in the twelve months leading up to December 2023, reaching approximately 20 percent of U.S. households, according to an analysis by PwC.

Shifting Strategies in Big Food

In light of these trends, food industry leaders are adjusting their product lines. Peter ter Kulve, CEO of Magnum Ice Cream, noted that users of GLP-1 medications continue to indulge in treats but show “a stark reduction of mindless munching and binge eating.” This shift has prompted Coca-Cola’s incoming CEO to stress the importance of accelerated innovation during his first analyst call last week. Meanwhile, Kraft Heinz‘s new chief executive has paused a planned company split and instead announced an investment of US$600 million this year to rejuvenate its Oscar Mayer brand and other long-neglected staples.

Capital expenditure is expected to increase across major food companies, with forecasts suggesting a rise of up to 23 percent for General Mills, as indicated by LSEG data. PepsiCo has introduced a new line called “Simply NKD” aimed at reformulating its snacks, while rebranding existing products like Lay’s and Gatorade by removing artificial colors. At a recent conference, CEO Ramon Laguarta expressed optimism, stating, “I think there are more opportunities than threats.”

Investing in Healthier Options

Other companies are also aligning their products with this new consumer landscape. Coca-Cola ramped up production of its protein-infused Fairlife milk last year to meet increasing demand. General Mills introduced a higher protein version of Cheerios in December 2024, responding to rising competition in breakfast foods. CEO Jeffrey Harmening stated that GLP-1 and similar anti-obesity drugs will have a lasting impact on food and nutrition, encouraging consumers to opt for smaller portions and more nutrient-dense options.

“We expect GLP-1 and other anti-obesity drugs to have a lasting influence in the food and nutrition landscape,”

Harmening added at the Consumer Analyst Group of New York (CAGNY) conference.

Companies like Conagra Brands are also adapting their portfolios, investing in snacks that feature higher protein content and portion control, particularly for younger consumers. Managing Director Peter Mangan of Portage Point Partners remarked, “There’s not anyone out there that’s not designing, putting R&D dollars against this trend.”

Smaller businesses are capitalizing on this shift as well. Snap Kitchen, an Austin-based meal service, is expanding its menu to include products with higher fiber and lean protein content, reflecting changing consumer preferences. CEO Mitchell Raisch noted that the GLP-1 opportunity has sharpened focus and accelerated their product development pipeline.

Research from PwC indicates that GLP-1 users consume an average of 40 percent fewer calories, with dessert and alcohol consumption dropping significantly. The data shows that family grocery baskets are now 4 percent to 6 percent smaller, while single-person households have seen declines of up to 9 percent in their shopping volumes.

Ali Furman, PwC’s U.S. consumer markets leader, concluded that the full impact of these physiological changes is just beginning to be understood. The food industry is poised for continued transformation as it adapts to the evolving landscape shaped by these appetite-suppressing medications.