Coca-Cola is finally seeing ‘green shoots’ of recovery as effects of one brand strategy kick in

Taste the Feeling

Coca-Cola says it is beginning to see spring-like signs of recovery following the implementation of its one brand strategy and the roll out of its ‘Taste the Feeling’ campaign, which markets its sub-brands under the same banner.

The drinks giant introduced the significant shift in its marketing strategy globally at the beginning of 2016 to extend the equity and appeal of Coke to its Diet, Zero Sugar and Life variants. The idea is that by uniting Coca-Cola’s products it can encourage consumers to stay within the brand as tastes shift and health concerns become more prevalent.

It’s been a big year for the business, as it also introduced a single visual identity system anchored by the brands' 'Red Disc', marking the first time in Coca-Cola’s 130-year history that Coke’s packaging has been shared across all media and trademark products. It also launched a £10m advertising push and rebrand of Coke Zero, now known as Coke Zero Sugar, to better communicate its no sugar credentials.

Speaking at Barclays Global Consumer Staples Conference yesterday (6 September) James Quincy, president and chief operating officer, Coca-Cola told analysts early signs of its efforts this year are “encouraging”.

“The early signs from the data are starting to look very encouraging, especially in those places where we launched first and we launched the fastest and the hardest, and we see encouraging results in terms of retail sales growth of the Coca-Cola brand in total.

“So green shoots on the 'Taste the Feeling' and the one brand graphical look, which have been launched only in May. It is a little early to work out what's happening there, but both of them are looking promising.”

In its second quarter financial results in July, Coca-Cola’s global price/mix grew 3 per cent, a reflection that its decision to shrink its cans while pushing products at a more premium price is also beginning to show signs of paying off. The impetus for the shift is that smaller packages are growing much faster than larger packages, amid vicissitudes in consumer health concerns, meaning that Coke is essentially able to sell more Coke more often and charge more for it.

“We have taken the idea of being more revenue focused rather than volume focused,” continued Quincy. “So in simple terms, that's not just about taking price but it is about marketing smaller packages, more premium packages, more affordable small packages.

“All of these are good from a revenue point of view but they are also good from the point of view of reducing the number of calorie.”

It also means that Coca-Cola can bring more people into the franchise because “quite simply put, some of the people who are out of the franchise didn't want to come in drinking 20 ounce bottle”.

Outside of its fizzy drinks, the company is working to grow its stills category, which includes juice, ready-to-drink coffee, water, and sports drinks. To do this it is trying to innovate through product and M&A to grow its 15 per cent share of global revenue in the sector. In its North America business, Coca-Cola has grown its stills category from 16 per cent to 36 per cent since 2000. While this is a relatively small gain, Coca-Cola believes it adds “a great deal of value creation”.

Of it’s still drinks ambitions Quincy said: “There is ample opportunity for us to follow a very similar game plan and path of gaining market share steadily over the years as we have done in the Sparkling beverage industry”.

Get The Drum Newsletter

Build your marketing knowledge by choosing from daily news bulletins or a weekly special.