The beverage large, contemporary off saying the
shutdown of longtime juice smoothie brand Odwalla, is contemplating dumping different “zombie brands” — or people who aren’t rising — to assist lower prices, Coke’s CEO James Quincey mentioned on the corporate’s second-quarter earnings name Tuesday.
During the previous few months, Coca-Cola —
like other major consumer goods companies — streamlined its product choices and zeroed in on its bigger and best-selling manufacturers to assist ease the pressure on provide chains. Coca-Cola is now doubling down on these efforts.
In Coca-Cola’s second quarter, which ended on June 26, the corporate noticed gross sales drop 28% to $7.2 billion.
“We are shifting to prioritizing fewer but bigger and stronger brands across various consumer needs,” Quincey mentioned. “At the same time, we need to do a better job nurturing and growing smaller, more enduing propositions and exiting some zombie brands.”
More than half of Coca-Cola’s 400 manufacturers are ones with “little to no scale” and have gross sales that signify solely 2% of whole income, Quincey mentioned.
Quincey didn’t title particular manufacturers the corporate was contemplating dropping, and a Coca-Cola spokesman declined to supply extra remark.
This is not Coca-Cola’s first zombie hunt. During the previous two years, the corporate has been
“identifying and killing zombie” brands, merchandise, flavors and packaging that weren’t delivering as excessive of returns as different merchandise. In the primary half of final yr, Coca-Cola eradicated more than 275 merchandise, Quincey mentioned throughout a July 2019 earnings name.
One of the corporate’s most notable zombies was
New Coke, a reformulation launched in April 1985
and scrapped in July 1985.
“The lesson of New Coke was not so much the conviction to launch it but the courage to withdraw it after less than 80 days,” Francisco Crespo, Coca-Cola’s former chief development officer wrote in a
2018 blog post concerning the product culling.
– CNN Business’ Danielle Wiener-Bronner contributed to this report.