Coke taps new trends

20 October 2011

ATLANTA: Coca-Cola, the soft drinks giant, believes several major trends offer room for optimism and growth, despite the challenging economic climate.

Speaking on a conference call, Muhter Kent, Coca-Cola's chief executive, outlined its positive outlook. "The last few months have reinforced our belief in the resilience of the global consumer," he said.

Kent reported the firm's tracking of sales, the movement of shoppers between retail channels and out-of-home dining showed its goal of doubling revenues by 2020 was viable.

"What we've seen this past quarter is that across the world, non-alcoholic beverages continue to generate increasing demand," said Kent. "The assumptions that guided the development of our 2020 Vision still ring true."

Demographic shifts support this view, with the worldwide population having grown by 200m people since 2008, in which time roughly an equal amount of people have joined the middle class, Kent stated.

Similarly, the largest international cities now boast an extra 100m residents, providing substantial opportunities for Coke to secure new customers. "Our business was built for times like this," Kent said.

"Our business is strong across channels and across consumer age groups. We're well positioned to connect with global consumers who have a greater disposition to shop across multiple retail channels in search of real value."

Even in America, where conditions are particularly challenging, room for optimism remains. The US population is set to rise by 30m people by 2020, with the third-highest number of teens of any country.

"For the diversity of our population, the entrepreneurial spirit, the amount of university graduates that we attract from all around the world: the best," said Kent. "If we can't grow, it's our fault."
Kent also argued the recession had led to a decline in consumer "mobility" as shoppers look to "in-home entertainment". In response, Coke has rolled out new packaging and pricing models, and introduced more coolers and vending machines into stores.

"We saw those trends and we invested against them to ensure that we would actually continue to drive our immediate consumption business, whether it is on the streets of Italy or whether it's on the streets of Shanghai or in Africa," he said.

Coca-Cola has also boosted its sustainability efforts with the PlantBottle, engaging eco-conscious customers, and launched the Freestyle fountain dispenser, mixing various drinks on demand, to achieve similar goals.

Data sourced from Seeking Alpha; additional content by Warc staff