Coca Cola admits a brake on consumption and relaunched Ades to expand
“The first four months of the year were very good, but we have a brake on consumption between May and June, now we are on par with sales in 2017 and we expect to close this year at the same levels as last year.” Franck Salmon is French, speaks perfect Spanish and is Vice President of Marketing for Coca-Cola for the South of Latin America. The local subsidiary of the US multinational usually serves as a mirror of the mass consumption situation.
Coca-Cola announced yesterday the relaunch of Ades, a brand that was born as a soy-based beverage, and will now mutate into almond milk, chocolate based on seeds and other products of vegetable origin. The investment will be US $ 20 million and seeks to expand the product beyond Argentina, where it concentrates almost 90% of its sales.
The bulk of Coca-Cola’s sales are in soft drinks, but their water and juice options already represent between 25% and 30% of what they sell, according to Salmon. Global indicators show that consumption growth will go through that segment.
“We push returnable and other products that are more relevant in a context of withdrawal and erosion of consumption”, explains Salmon, who does not hesitate to answer about the sales retraction. Instead, he prefers to shift the response to a local executive to the controversial tax reform proposed by the government last year. In that modification, sugar beverages were going to be levied, which led Coca-Cola to analyze if it would continue with its investment levels. Nothing changed and the company continues with its planned disbursement of US $ 1.2 billion in three years, from 2019.
“The country is once again going through a certain erosion in consumption and consumer mood, with a certain pessimism,” defines Salmon as the state of affairs. However, he says that Coca-Cola has been present in the country for 75 years and that it has already gone through other similar “crises”. “Our bet is medium and long term, we are used to surfing difficult situations,” he says.
To cope with inflation, Coca-Cola will continue to pull “affordable” packaging (which can be achieved or achieved), such as $ 10 cans. These promotions depend a lot on their 360,000 points of sale -80% are SMEs, kiosks or small shops- . that do not always give continuity
There is a consumer segment that is moving towards the dietetics or shops with more “natural” proposals. “We believe that with Ades we can bring innovative and flavored products to strategic points of sale with greater reach,” observes Salmon. The last communication of Ades was focused as a drink that mothers could give their children to hydrate. Now, its spectrum will be wider, trying to reach a wider audience.
The next Ades landings will be in Chile, Uruguay, Paraguay, Bolivia and Peru. It will also plant a flag in Brazil, Mexico, along with an incursion into Spain and the United Kingdom. That is the plan to take the mark of Argentine origin around the world.
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