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Coke Plans to Reshape Bottling Industry After Posting Positive First-Quarter

Posted by Dale Buss on April 16, 2013 04:39 PM

Coca-Cola took one step back a few years ago by acquiring large pieces of its bottling operations. Now the company plans to take two steps forward by handing back big chunks of its bottling system to selected independent bottlers as part of Coke's overall creation of a national bottling and distribution system that will give it far more control over sales, distribution and balancing of its brands.

Specifically, Coke disclosed a rough framework for handing off distribution in certain geographic areas to five established, independent bottlers either through an outright sale, a swap of territory or other arrangements. Closings, after more negotiations, are expected by year-end.

"We are intent to make the necessary changes in the format and architecture of production to achieve ... a coast-to-coast, nationally run production system," Coke CEO Muhtar Kent said on Tuesday's earnings call, according to the Wall Street Journal.

Under the new arrangements, the bottlers will be able to take part in that model by purchasing trucks, coolers and other equipment to distribute the products in their territories, the newspaper said. The national model also will enable Coke to be more responsive to large customers like Walmart because the company can make centralized sales and marketing decisions. PepsiCo similarly concentrated its bottling operations three years ago but Coke has moved first on the next step.Continue reading...

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Coca-Cola Removes Itself from Obesity Message in Latest "Chairs" Ad

Posted by Abe Sauer on March 27, 2013 12:39 PM

"We are… chairs. And now it's time to conquer you."

"What if we stand up?" is the message in a new ad for Coca-Cola, part of the soda maker's "4 commitments to fight overweight and sedentary lifestyle" campaign and part of Coke's larger push to get out ahead of the negative "sugary drinks" PR wave. By breaking the message that connected the Coke brand to "the problem," it's a departure from the brand's previous "obesity" messaging. 

The ad is running in Spain—where Coke just signed a new bottling agreement and launched is "Happiness" ATMs as part of its global "Open Happiness" campaign.Continue reading...

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Coke Brands World Peace with "Open Happiness" Machines

Posted by Dale Buss on March 15, 2013 01:17 PM

Coca-Cola has been getting very serious about its "Open Happiness" campaign. Now it may even be ready to try to beat swords into plowshares—or at least into vending machines.

Ad Age reports that a big announcement "is coming soon" about a "major project" for the brand, possibly involving vending machines that will virtually connect consumers in India and Pakistan, two countries that long have had sectarian, sometimes bloody, differences. As depicted in a teaser video that Coke released in December, the machines would use video technology so that users in the two countries could see each other and "touch hands virtually," the magazine reported.

"The idea," Ad Age continued, "is that it could roll out to various countries in conflict."Continue reading...

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Bad News for Big Soda: U.S. Water Consumption Passes Cola

Posted by Dale Buss on March 13, 2013 06:03 PM

Bottled water has gone from a fringe product for suspicious purists to one of the most popular drinks in America, while soda's frailties as a beverage finally seem to be catching up with it.

These trends were formally recognized this week when Beverage Digest reported that Americans now drink an average of about 58 gallons of water per year, an increase of 38 percent from 1998. 15 years ago, U.S. consumption of soft drinks peaked, according to the publication, at 54 gallons of soda per year; consumption since then has dropped by 17 percent, to 44 gallons of soda per year.

All of that is welcome news to nutritionists who've been—successfully, it seems—telling the public about the empty calories in soft drinks and castigating Coke, Pepsi, Dr Pepper and the like as one of the (if you believe a certain mayor) biggest villains in the nation's war on obesity. There's a reason that Mike Bloomberg has targeted soft drinks for his big-sugary-beverage ban in the Big Apple, even though many disagree with his tactics.Continue reading...

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Coca-Cola Launches Anti-Obesity Ads in U.K.

Posted by Dale Buss on March 7, 2013 02:11 PM

Coca-Cola is getting more serious about its anti-obesity efforts, and the U.K. is the newest market on the receiving end. Coke began airing ads about "energy balance" and calorie content in Great Britain last evening and, among other steps, has replaced Sprite across the country with a new reduced-calorie version of Sprite that is sweetened by Stevia.

The actions, of course, follow on the advertising that Atlanta-based Coke aired in the U.S. earlier this year as part of its campaign to get consumers to "Be OK" with the simple equation that weight loss or gain is determined by calories consumed plus physical activity.

In Coke's first spot on U.K. television on Wednesday, titled "Coming Together," the company reminded viewers "that all calories count in managing weight, including those in Coca-Cola's products and brands," as the company said on its Web site.

Continue reading...

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Not So Innocent: Coke Gets Complaints in Europe as it Bolsters Middle East Presence

Posted by Dale Buss on February 27, 2013 02:18 PM

Coca-Cola keeps moving forward with global consolidation as it swallows up the remaining stake of a juice brand in Europe and launches two new brand platforms in the Middle East.

In Europe, Coca-Cola is moving to acquire almost all of the 40 percent of Innocent Drinks that it didn't already own after raising its stake in stages beginning in 2009. Innocent makes smoothies, juices and other healthy foods and has been a rising better-for-you brand in Europe, building its brand equity on corporate "innocence."

Will Innocent and Coke face a European-consumer backlash over the brand's now-complete dependence on a well-known multinational company that some say isn't quite so innocent? After all, it's recently come under new criticism by Oxfam over allegely unethical practices.Continue reading...


The Week in China: Versace Wallpaper, Horse Meat, NZ Milk Scandals and more

Posted by Abe Sauer on February 22, 2013 12:57 PM

Above, a Coke and a smile are still the right stuff for the brand during China's Lunar New Year holiday. 

China is the second largest economy in the world and every significant brand's future is impacted by its growth (or collapse)—but who's got the time?! Here's 10 reads that will make you look like a keen China observer in case you find yourself immersed in a cultural conversation.

This week: Dwayne Wade visits the Bird's Nest... VW bump... stealing Coke's recipe... McDonald's... Versace wallpaper... poisonous fake mutton vs. horse meat... lobster... coffee beaneries... New Zealand's Chinese New Zealand milk... and more. Continue reading...

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With Soda Volume Down, Coca-Cola Pushes Teas And Low-Cal Drinks

Posted by Dale Buss on February 13, 2013 03:23 PM

Coca-Cola just wants to Open Happiness around the world, in keeping with its ongoing marketing theme, including rolling out a Valentine's Day video this week that was shot in New Zealand to thank its multitude of fans. It's just that global consumers haven't been as happy lately to open a Coke.

A slowdown in sales in Europe and China joined essentially stagnant sales in the United States to undermine Coke's fourth-quarter results. Global sales volume rose just three percent even as the beverage giant's earnings rose by 13 percent during the period.

Ongoing struggles in Europe were a main drag, with volume falling by five percent. Even sales in China, another key market, fell by four percent as Chinese consumers increasingly feel crimped. Meanwhile, the U.S., pushing an anemic economic recovery, yielded just a one percent sales gain during the quarter, though CEO Muhtar Kent said on Tuesday's earnings call that the American market "could get better."Continue reading...

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