The beverage giant, which has just announced the closure of Odwalla, the long-time juice smoothie brand, is considering removing other “zombie brands,” or those that are not growing, to help cut costs, Coca-Cola CEO James Quincey said of the company’s second-quarter earnings. call tuesday.
Over the past few months, Coca-Cola, like other large consumer goods companies, has streamlined its product offerings and focused on its biggest and best-selling brands to help ease tension in supply chains. Coca-Cola is now doubling down on those efforts.
In Coca-Cola’s second quarter, which ended on June 26, the company’s sales fell 28% to $ 7.2 billion.
“We are shifting to prioritizing fewer brands, but bigger and stronger on various consumer needs,” said Quincey. “At the same time, we need to do a better job of fostering and making smaller, more durable proposals and coming out of some zombie brands.”
More than half of Coca-Cola’s 400 brands are “little to no scale” and have sales that represent only 2% of total revenue, Quincey said.
Quincey did not mention specific brands the company was considering abandoning, and a Coca-Cola spokesperson declined to provide additional comment.
This is not the first Coca-Cola zombie hunt. For the past two years, the company has been “identifying and killing zombie brands, products, flavors and packaging” that did not offer as high returns as other products. In the first half of last year, Coca-Cola phased out more than 275 products, Quincey said during a July 2019 earnings call.
One of the company’s most notable zombies was New Coke, a reformulation introduced in April 1985 and scrapped in July 1985.
“New Coke’s lesson was not so much the conviction to launch it, but the courage to withdraw it after less than 80 days,” wrote Francisco Crespo, former Coca-Cola chief growth officer, in a 2018 blog post about removing products.
– CNN Business’s Danielle Wiener-Bronner contributed to this report.
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