In an exclusive interview with Cash & Carry Management, Gary Black (pictured), sales director wholesale & convenience at Coca-Cola European Partners, explains how the supplier can now give enhanced support to wholesalers on how to maximise the soft drinks opportunity.
Wholesalers are the vital part of the chain that links us to thousands of independent operators and the consumers that visit them every day. Since last year, we have reorganised our teams to have a greater focus on the specific customer environments we service. This means that we are able to give enhanced support to wholesalers on how best to tailor their soft drinks offer to meet the diverse needs of their customer base, including convenience, food-to-go and on-premise operators.
We continue to have one of the largest field sales teams in GB and have increased our visits to over 850,000 this year alone. Within this, we have a dedicated team calling on wholesale outlets.
What are CCEP’s priorities in maximising sales and profits through the C&C/delivered wholesale channel?
At the start of 2018 we unveiled our plans to become a ‘total beverage company’, evolving our portfolio of brands to reach more consumers, on more occasions, every day, which in turn provides more opportunities for wholesalers, retailers and licensees to realise increased sales. Our focus is on ‘growing the core whilst adding some more’.
Essentially, it’s about providing more choice through the introduction of low and zero-sugar variants to tap into the health and wellness trend, new flavours to excite shoppers, and a variety of formats for different occasions. It also sees us moving into new segments, for example ready-to-drink tea and coffee.
Flavour innovation is at the heart of our strategy to grow our range of core brands, specifically low and zero-sugar variants. This year, we’ve expanded our light cola flavours with Diet Coke Twisted Strawberry and Coca-Cola zero sugar Raspberry, which are now worth £7 million (Nielsen). We also introduced Fanta Zero Grape in March following huge demand for the flavour on social media. The variant is already worth £5 million and delivering the highest rate of sale of all Fanta variants.
Flavour innovation is also helping to grow the energy segment, and this year we bolstered our zero-sugar range with citrus berry flavoured Monster Ultra Blue.
We have also added more to our portfolio. March saw the launch of Espresso Monster and it is already the number two ready-to-drink coffee brand in value within the impulse channel (Nielsen). We recently introduced Coca-Cola Energy in 250ml cans and in two variants – with and without sugar. Additionally, Coca-Cola Signature Mixers, a range of four specially crafted drinks designed to be mixed with premium spirits, were launched in July to pubs, bars and restaurants through licensed wholesalers.
How has CCEP supported C&Cs/delivered wholesalers this year?
Last year, we launched a new ‘Add to Order’ service. It means that our reps can identify range gaps (new products and out of stocks) and instantly add them to a retailer’s order with their chosen wholesaler, whereas previously our reps provided advice and the retailer had to place the order. This service has been transformational for our customers and we now have hundreds of wholesalers on board, with thousands of orders placed weekly.
By working closely with wholesalers, we’ve been able to demonstrate the value of the ‘Add to Order’ service to their business and how it enables us to work in a way that is more connected through the use of technology.
What initiatives are planned for the C&C/delivered wholesale channel for the rest of 2019?
In addition to our existing NPD for 2019, Costa Coffee ready-to-drink is currently rolling out across GB and the response from consumers has been incredibly positive. The 250ml can range includes Classic Latte, Caramel Latte and Black Americano, with each variant containing 30% less sugar than most other ready-to-drink coffees.
Made with the same Mocha Italia coffee beans used in Costa’s high street cafes, each drink contains the equivalent of a double shot of espresso. In combination with Espresso Monster, we are confident that our portfolio of ready-to-drink coffee brands will help to expand the category in GB which is now worth £116 million and up by 36% year-on-year (Nielsen).
There are also some big events and occasions that wholesalers can get behind between now and the end of the year. The Premier League season kicks off this month and we’re currently running a multi-brand on-pack promotion giving away more than 960 pairs of tickets to Premier League football matches. What’s more, Coca-Cola, the Official Soft Drink partner of the Premier League, has unveiled a new version of its ‘Where Everyone Plays’ TV advert to welcome the three promoted clubs – Aston Villa, Norwich City and Sheffield United – to the Premier League.
Fanta Halloween will be back with ghoulish graphics on-pack and our biggest Halloween innovation to date – Fanta Dark Orange, which has a great tasting blood orange flavour with a dark twist. The new variant’s dark colour and wolf on-pack graphics will catch shoppers’ attention and drive impulse purchases as people look to stock up for Halloween-themed celebrations.
Fanta Dark Orange is soft drinks tax exempt and will be available from mid-September in 500ml plain and price-marked bottles and two-litre bottles.
As you would expect, Coca-Cola Christmas will once again be a big fixture on the calendar – details to follow in due course.
How has the soft drinks levy (and the reformulation of your existing brands) affected your business?
The introduction of the soft drinks tax was a landmark moment for the soft drinks industry. We approached the implementation of the tax with two strong principles. Firstly, we stood firm in our belief that people want choice and love the original taste of favourites like Coca-Cola, so therefore we would not change the recipe. The second principle was that we would not reformulate unless the end product tasted as good as, or even better than, the original.
This strategy has led to continued positive performance of our core brands and accelerated growth across our low and zero-sugar variants. For example, Coca-Cola original taste remains the biggest soft drink in GB, Diet Coke is the No.1 sugar-free cola, and Coca-Cola zero sugar is the fastest growing major cola brand, up by 53% (Nielsen). Seven out of 10 colas sold in convenience come from the Coke portfolio (Nielsen).
We recently launched a new campaign, ‘The Magic Taste of Coca-Cola’, that celebrates the drink’s iconic taste and its ability to spark memories associated with taking the first sip. The campaign will include TV and out-of-home advertising, as well as digital experiential and PR activities.
Have you changed your advice to C&Cs and delivered wholesalers in terms of ranging and category management following the sugar tax?
Our advice remains the same. We recommend that wholesalers pick products that are being well supported by manufacturers, those that have been developed in response to consumer trends and from large or growing soft drink segments. Wholesalers and their customers also need to look at their sales data, removing slower selling lines and duplication to free up space to allow for multiple facings of best sellers or the stocking of new products, which are the lifeblood of this sector.
What is on the sustainability agenda for CCEP and how will it affect C&Cs/ delivered wholesalers?
In 2017 we unveiled our ‘This is Forward’ action plan which places sustainability at the heart of our business strategy. It outlines commitments and actions in a variety of areas including our drinks, packaging and the communities in which we operate.
All our bottles and cans are 100% recyclable and our plastic bottles include 25% recycled plastic (rPET). By the end of the year, smartwater bottles will be made from 100% rPET, removing 3,100 tonnes of virgin plastic from circulation each year. We’re also on track to double the amount of rPET used in all other plastic bottles in early 2020 to take them to 50%, and Sprite bottles will move from green to clear to enhance recyclability.
What is your view on deposit return schemes?
If we want to include more than 50% rPET across our portfolio, we’re going to need a better collection system in GB. With this in mind we support the arrival of a well-designed deposit return scheme (DRS) as we believe it is good for the category, helping to reassure consumers that their packaging is being recycled properly and responsibly whilst allowing the industry to collect and reuse more packaging, and reduce littering.
We know that DRS is going to take time so meanwhile we’ll continue to use our brands to encourage more recycling. Activity over the past year includes ‘Please Recycle Me’ messaging on all 500ml bottles of our Coca-Cola range, new in-store PoS to encourage shoppers to recycle their drinks packaging, and our ‘Across the Tracks’ recycling advert.
Tel: Coca-Cola European Partners (0808) 1000 000
Published Date: August 10, 2019