Coke shaken by low-carb failure

David Teather in New York
Friday January 7, 2005
The Guardian

Coca-Cola is restructuring its North American division as part of an attempt by the struggling soft drinks maker to pull itself out of a long slump.

The firm is parting company with Javier Benito, its chief marketing officer and head of retail in its most important market. Mr Benito had been with Coca-Cola for 10 years.

Analysts said he was probably paying the price for the disastrous US launch of C2, a mid-calorie, low carbohydrate version of the core brand.

In November, Coca-Cola sharply cut its long-term profit and sales targets, acknowledging there would be no quick fix for its problems.

Chief executive Neville Isdell, who took the top job last May, admitted then Coca-Cola had failed to respond to consumer trends. Arch-rival PepsiCo has been more adept.

It has the number one bottled water brand in the US, Aquafina, and the top energy drink, Gatorade.

Coca-Cola plans to spend an additional $350m (£187m) to $400m on marketing annually from next year, with most of it directed toward its core brand. It does not publish the level of its total budget. "We can't save our way to prosperity, we have to grow our way to prosperity," Mr Isdell said.

The firm said at the time there had been "too little attention paid to brand-building, iconic advertising". C2 has proven to be a particular disappointment for Coca-Cola, posting poor sales. The company priced the soft drink at a premium to regular Coke and the higher cost proved an obstacle for consumers. It also launched the brand just as the low-carbohydrate diet phenomenon was waning.



Hindered by C2's poor performance, Coca-Cola reported a 3% drop in volume sales in North America during the third quarter, which covers the key summer season. The company said Mr Benito's role would be split into two jobs in an effort to make it more competitive in North America. His marketing role will be taken by John Hackett, who becomes senior vice-president for North American marketing.

http://www.guardian.co.uk/business/...1384934,00.html

A big giant raspberry. Didn't we tell you so? Sheesh! You really should listen to us.

Can they really be so stupid?
" It also launched the brand just as the low-carbohydrate diet phenomenon was waning."

The most obvious thing is that low-carbers weren't drinking full sugar coke and looking for less. They were drinking diet coke and wouldn't consider drinking more sugar. amazing...

Poor Coke. Had they read even a single low carb diet book they would have found out we didn't want less sugar, we wanted no-sugar. Hmmm.... isn't that diet coke?????

In my opinion they could not advertise for an entire year I doubt they would see a drop in sales at all. I know so many people who are addicted to coke both diet and regular!

This restored my faith in the general public... The fact that it wasn't a hit just because it had low-carb on the label means that people read the nutritional info and realized it was just silly.


Maybe there is hope yet.

--nw

If they'd *really* been listening, they would have replaced aspartame in Diet Coke with Splenda... now *that's* a good idea for Coca Cola. Wow, all that, and I don't have the $250,000 salary. Sheesh!

Complete idiots!!! You all have said it so clearly. Why would we LCers go BACK to carbs when diet cola (and generic is just as good) has no carbs.

Agreed that RC cola with Splenda is the best idea IF you can get it.

Splenda instead of aspartame? Now why would a soda manufacturer want to do that? Maybe they should have hired the CEO of Diet Rite

This is exactly what my reaction was when I first heard about the "new" low carb Coke (C2). I said, "Diet Coke is already low carb. Why not just emphasize that instead of spending all that money on a new product?"
Whoever came up with the idea of marketing a product to low carbers that still has the amount of sugar in it that C2 does, deserves to be seeking other employment; it was a hare-brained idea from the get-go and had they done any research into low carbing, they would have known that it wouldn't be a best-seller. Even for those on maintainence, it doesn't really fit with the philosophy of low carbing.

I wonder if the Pepsi Edge was also a disaster. It ought to have been. Everyone I know who actually low carbs took one look at C2 and Edge, shrugged, and bought diet soda.

They sell C2 here in Japan, but I never tried after after looking at the carbs in it. Like all of you I was wondering "what were they thinking?"

The diet coke sold here is made with BOTH aspartame and sucralose. Is that the same as there?

doug

Nope. Diet Coke sold in the United States has only Aspartame.

I know that for example the Diet Coke formula they sell in Europe tastes a lot better than the one here in America. I remember that when I worked for Coke in Italy they brought it to me and I said, WOW, this tastes really good, how come they don't sell this formula in America? They did not have an answer for me and I still don't know why? But that diet coke is the best I have ever had.

That's interesting - here in Canada, Diet Coke and most other diet drinks are sweetened with aspartame and acesulfame-potassium.

The diet coke here tastes pretty good with the aspartame/sucralose mix.

doug