Coke Is Hurting From the Switch to Online Shopping, Too

From Bloomberg Technology:

As Coca-Cola Co. Chief Executive Officer James Quincey settles into his new job, he’s facing a challenge that most of his predecessors never worried about: digital disruption.

Consumers are increasingly shopping online, spending more time on mobile apps, and getting groceries delivered to their homes. And that’s hitting Coca-Cola in ways you might not expect, Quincey said in an interview from his office in Atlanta.

When shoppers skip trips to the local mall and get their clothes at Amazon, they also forgo buying Coke at a vending machine or food court. So while the decline of retailers has mostly focused on bankrupt apparel chains and shuttered storefronts, a brand like Coca-Cola is suffering as well.

“Digital is changing the way you behave,” he said. “It affects other categories that are not the primary reason you thought about making the shopping trip.”

Turning Coke into a winner of the digital age — rather than another brick-and-mortar victim — is a key priority for Quincey.

. . . .

The disruptive power of tech has been especially pronounced in some overseas markets, including China. When Quincey was chief operating officer in early 2016, he saw sales in that country slump — hurt by a decline in sales to noodle shops and other restaurants.

The shops themselves weren’t the problem — they were still selling large quantities of food — but more customers were ordering online and having their meals delivered. The problem for Coca-Cola: The restaurants offered glass bottles and sizes that weren’t suited to being transported via scooter.

Link to the rest at Bloomberg Technology

32 thoughts on “Coke Is Hurting From the Switch to Online Shopping, Too”

  1. Funny, the pizza place here still offers 2 liter bottles to go. Sounds like offering plastic in China would be a no-brainer.

    And me dear ol’ mum still like her diet coke, but she never orders it when eating out.

    But yeah, not so much impulse buying from the comfort of me chair.

    • I broke my cola habit years ago and have a Coke Zero maybe once every couple months as a treat. I also note that the two pals I know who drink it daily (regular Coke) are 1. feeling guilty about it in one case and trying to give it up and 2 the other gets angry at the folks who try to guilt her about drinking junk.

      I think there’s also this social thing going on where drinking sugary soft drinks are getting dinged the way cigarettes were (due to obesity and Diabetes II “epidemics”). I hear a lot of ranting and some memes about giving up junk drinks, taxing them, etc.

      Coke and Pepsi, etc, may wanna keep an eye on that peer pressure thing.

      Plus the latest article that went round about how diet soda–the refuge of the sugar-free–affects cognition and raises risks of stroke and dementia. That can’t be good P.R. in an age of folks absolutely terrified by the specter of Alzheimer’s Disease.

      • I’ll admit my dad had me ignoring most of those ‘this is bad for you’ articles after the one that claimed mother’s breast milk was bad for their babies. Most of them focus on one thing and don’t take anything else into consideration.

        As to who drinks what and why? Each to their own. She hates plain water, only has a coffee a couple times a week if that often, and doesn’t drink enough fluids most days. If I can’t get her to drink more if there’s diet coke in the house then I’m more than happy to feed her habit.

        “I hear a lot of ranting and some memes about giving up junk drinks, taxing them, etc.”

        You don’t want that! Next they’ll go after the ‘junk’ stories we waste our time on and they’ll want to tax romance and sci-fi! 😛

    • Plastic or metal vs. glass is a political issue in some US states; it might be that way in China as well.

  2. Coke has exclusive agreements with a very large percentage of the restaurants and stores.

    It turns out that when people have a choice (they aren’t limited to what the venue contracts for), Coke products don’t do nearly as well.

    When people order delivery, they are more willing to stick with the drinks they have on hand.

    The horribly inflated costs that the delivery stores charge for drinks are another issue. If you have much of a crowd, it’s cheaper to driver to a supermarket and buy what you want (and ice to chill it in a bucket) than to pay the delivery cost of a very restricted selection of drinks.

  3. We have to support cola companies. Didn’t you see the ad where it has the power to stop riots and end racism?

  4. Sales loss might be due to “teh interwabz” and Evil Amazon, but… I used to be a Cokeaholic. As in, a couple of 3-liter bottles per day. And then I got a bottle full of industrial waste that I had to pour down the sink. And every bottle after.

    Back around ’07 the Coca-Cola company got a waiver from the FDA; it’s on the FDA web site, but you have to negotiate a maze of twisty little passages to find it. The waiver lets them substitute sugar for artificial sweetener without noting it on the label or the nutrition information. So the bottle of Coke or Dr. Pepper you got might be anywhere up to 100% Diet Coke or Diet Dr. Which taste like industrial waste.

    Since aspartame (and later, Stevia) are much cheaper than sugar, and the official line is that the artificial sweeteners are just as tasty as sugar and only nutters claim to be able to taste the difference, and surely getting fewer calories than you paid for is a good thing, everybody wins.

    Except, despite the claims of the bottlers and sweetener manufacturers, the “one in a million” person who can tell the difference is more like one in five. To most of them, it’s just “not right.” To nutters like me, aspartame is bitter, and Stevia tastes like licking a 9-volt battery. And though they’d probably claim I was a statistical anomaly, I know several others in meatspace who react the same.

    They might blame their sales loss on people not going to malls any more, but maybe they should consider that to a big portion of the population, their product simply doesn’t taste good any more.

    Coke’s fans went to “Mexican Coke” for a few years, until the Mexican bottlers followed suit. There’s “Passover Coke” available seasonally in a handful of large cities, which seems to be the Real Thing ™, but even at my level of addiction driving 150 miles and buying a year’s supply at a time was too inconvenient to take seriously.

    They changed their product into something a lot of people don’t like any more. So those people quit buying it. I guess that’s waaaay to complex for the MBA types…

    • I remember that when I was a little kid, I couldn’t tell the difference between Pepsi and Coke. At some point, it became a very obvious difference. Coke tastes like carbonated acid to me. Pepsi is something I can enjoy on occasion, but there are several other options I prefer. While I may rarely have a Dr. Pepper if I’m craving a pop and there isn’t anything else, I mostly don’t like any Coke products. If I go into a restaurant/fast food place and they only serve Coke products, I either leave and go somewhere else, get it to go and get a drink somewhere else, or get water. Coke is just nasty to me. (FWIW, my favorite pop is Mt. Dew.)

    • When we came to the US, dad always said Coke in Cuba tasted better than Coke in the US. I assumed as a kid that it was nostalgia of an adult for his homeland. Later, I read how formulas differ by country. I have a pal who used to swear by Mexican Coke and shunned US Coke. (Same thing happened with another drink, forget the name, some powder mix thing..oh, wait, Crystal Light. People were getting it from Mexico.)

      So, maybe dad was right. Cuba’s 1950s coke tasted better (for him).

    • I believe you. I tried Stevia once. I don’t remember the taste, but I do remember feeling so lightheaded I feared I would faint. I try to avoid anything that claims it’s zero calorie or zero sugar; those products make me ravenously hungry. Nowadays if cane sugar isn’t listed as the sweetener I pass it by. I don’t remember what the official excuse is for companies not using sugar instead of aspartame etc, but I don’t care. Just not buying what they’re selling.

      • My theory about why sweeteners can make you so hungry is that the sweetness starts your insulin production. The insulin metabolizes the sugar in your blood stream and since no real sugar is actually incoming your blood sugar bottoms out. Making you really hungry, and not hungry for real food, but sweets.

        • That sounds plausible to me, says the lady who did not go past biology 101. Actually, I had the same idea, so I’m glad to know I’m not crazy for thinking it.

      • Stevia can taste fine—it depends very much on how it’s used—but I’m allergic. Gives me headaches.

        Aspartame has always made me sick, too, though I don’t have PKU.

        Hand me the sugar, please.

    • They have to label it in Germany. Haven’t had Coke in a loooong time. Too sweet. And I stay away from aspartame because it tastes like industrial waste to me, as well.

      So maybe they are losing their market and just find a convenient scape goat in online stores. I wonder who else was hit by that…

  5. I rarely drink Coke, but when I do, I drink the kind that contains REAL SUGAR. Not high fructose corn syrup. The Cokes with sugar are standard in most countries, but in the US you have to check; usually they’re in glass bottles at the grocery store.

    I don’t check the labels when I go to Greece, but then again, when in Hellas, all I want is an Arizona Iced Tea, which is difficult to find over there. Life is so hard.

  6. I have a hard time feeling bad about any software company. They’re making money hand over fist selling sugary syrup that is totally bad for you….and then they deny the negative effects of drinking their sodas? Tsk tsk.

  7. I stopped years ago. I drink tea if available, or water. Coke and Pepsi and all the other colas just started tasting nasty… probably the change TRX described. But it also coincided with job changes – I started carrying drinks with me when I was working in the field, and warm water is still okay, while warm cola of any kind is horrible and unsatisfying. So I had a double dose of aversion therapy… and now I don’t drink Coke.

  8. This recurring narrative that online shopping is to responsible for such and such decline of sales is as ridiculous as the notion that a bad jobs report can be blamed on the weather. The economy is broken, and all the official numbers are goosed to hide it.

  9. *shrug* Diet Dr. Pepper is my coke of choice. I buy it at the grocery store, and don’t order pizza in. (I like pizza, but just never think about buying it when I’ve got ingredients for something else in the ‘fridge and pantry.)

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