C&B Notes

Coke Imports Offering Strategy from Mexican Bottlers

As mentioned in the article below, Coke’s push in the United States to have more product size offerings at various price points is something that bottlers have been doing for quite a while in Latin America.  We have experienced this first hand through our various channel checks in Mexican and South American regions.  Coke’s ability to “price bracket” rivals has created some real competitive advantages in these markets, and it will be interesting how this strategy ultimately translates in the U.S.:

“These days the beverage giant’s sales formula revolves around more package sizes on store shelves…Coke will announce this week the launch of 12.5-ounce, 89-cent bottles to accompany the 16-ounce, 99-cent bottles it rolled out nationally last year as an alternative to 20-ounce bottles in U.S. convenience stores.  It will also slash the suggested retail price on its recently introduced eight-pack of 7.5-ounce Coke “mini” cans in supermarkets by about 20% to $2.99 to try and lure more customers.

Coke is importing the strategy from Mexico, where bottling partners began diversifying package sizes more than a decade ago to offer more price options in the wake of the 1994 peso devaluation and economic crisis.  In Mexico, the company’s top market by per-capita consumption, Coke is now sold in more than 30 packages, ranging from 6.75 ounces to three liters.

In the U.S.A., we’re really just at the beginning,” said Sandy Douglas, president of Coca Cola North America, of the increasingly segmented price-package strategy for the company’s Coke, Sprite and Fanta soda brands.”

>> Click here to access full story on The Wall Street Journal