Coca-Cola Takes On Fizzling Sales
By Karla Paris
Multi-faceted approach set to give Coca-Cola life in the shrinking soda market with product innovation, diversity, and more
While soda manufacturers, like Coca-Cola, have seen sales flatten in the soda market, the company has plans to change all of that. For more than 13 years, Americans have been drinking less soda due in part to rising health concerns about sugar intake and obesity. U.S. sales of Coke were down 2 percent last year alone.
On Feb. 5, Coca-Cola announced its plan to purchase 10 percent of Green Mountain Coffee Roasters for $1.25 billion. With this move, Coca-Cola is putting itself in position to bring the soda maker’s famous brands to the quickly-growing at-home market and compete with Sodastream, the largest maker of at-home soda machines. Green Mountain is famous for its single-serving coffee makers and coffee products, but now the company is working on a machine for cold drinks.
Coca-Cola is also digging its heels into the energy drink market. Coca-Cola just added new flavors to its vitaminwater line, vitaminwater energy. Coke already sells non-soda beverages including Minute Maid juice, Dasani water, and Powerade sports drinks, whose sales helped balance out the losses from the company’s soda sales. The company currently has 11 non-soda brands with more than $1 billion each in retail sales and an unrivaled distribution network, and operates in every country except Cuba and North Korea.
Don’t forget about the rumor that Coca-Cola is considering the acquisition of Monster Beverage Corporation that has persisted for some time. Sales volume was up 7.7 percent in 2013 for Monster Beverage Corp products, and if it were not for energy drinks such as it, overall soda volume would have fallen 3.3 percent last year.
In addition to its product innovation and reach into the energy drink space, Coca-Cola is bringing its message to market in a big way. Consider that Coca-Cola spent approximately $3.3 billion on marketing last year. The company plans to spend an addition $1 billion more in global advertising over the next three years, with most of that devoted to its soda portfolio.