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View Full Version : Costco stops selling Coca Cola products



Mr Zabe
11-17-2009, 01:32 PM
Costco drops Coke (http://www.chicagotribune.com/business/ap-costco-coke-nov17,0,100089.story)

greg
11-17-2009, 02:40 PM
I read this story and my first reaction was.....where are all the independent c- stores going to get their soda??????

badlieut
11-17-2009, 03:28 PM
Wonder if this includes Mexican Coke..I assume it would. This sucks.

Sundrop09
11-17-2009, 06:20 PM
I love it!!! I just hope Coke continues to stand their ground amidst all the publicity. Everyone knows Coke caters to all the larger companies with pricing, so its good to see that they are making a stand.

popologist
11-17-2009, 07:55 PM
most coke-drinkers (and pepsi-drinkers too) are pretty diehard and will likely just go somewhere else to buy their soda. since soda is kind of a staple that gets people into stores, this could end up being worse for costco than coke.

lordmadone
11-17-2009, 08:43 PM
Actually Popologist most "soda drinkers" are just like any consumer and looking for the BEST DEAL. Most have a favorite but most are also willing to comprimise with who's on sale..Coke will lose out so much more then Costco will on this by any and all means. The die hard drinkers dont account for that much of the market share...people go to bulk stores for bulk purchases..not usually led by soda as opposed to regular grocery stores.

Mr Zabe
11-17-2009, 09:29 PM
Actually Popologist most "soda drinkers" are just like any consumer and looking for the BEST DEAL. Most have a favorite but most are also willing to comprimise with who's on sale..Coke will lose out so much more then Costco will on this by any and all means. The die hard drinkers dont account for that much of the market share...people go to bulk stores for bulk purchases..not usually led by soda as opposed to regular grocery stores. I agree,well said.

fusion
11-17-2009, 11:38 PM
The clubs will sell through any inventory on hand, but not order any more until the issue is resolved.

popologist
11-18-2009, 05:15 PM
I still disagree. If it was all about "price," then generic store brand soda would be the best-selling because it's cheapest. But, it's not.

Most of the people I know either drink Coke or Pepsi (or Diet Coke, etc), and won't compromise on that, because it's about the "taste."

If I'm at a store to buy Coke Zero and they are sold out, then I go somewhere else until I find what I want. And if a store were to stop selling Coke Zero, I would probably stop going there altogether... unless there was something else there that was a must-have item. I wouldn't pick-up Diet Coke or Pepsi One instead... unless it was some kind of soda emergency... and I probably still wouldn't.

Sundrop09
11-18-2009, 10:19 PM
Well said Popologist. There is no doubt that there are certain consumers who buy solely based on price, however, the majority will buy the product that they normally drink no matter the price. Has anyone never seen 2lts at a c store for 1.99??To say that Coke would be hurt more by this than Costco is absurd.

popologist
11-19-2009, 11:41 AM
Well said Popologist. There is no doubt that there are certain consumers who buy solely based on price, however, the majority will buy the product that they normally drink no matter the price. Has anyone never seen 2lts at a c store for 1.99??To say that Coke would be hurt more by this than Costco is absurd.

$1.99 for a 2-liter is the normal price in NYC. Geeze, I didn't realize I was being ripped off! lol

Tannerman
11-19-2009, 01:06 PM
Should we start posting guesses as to how long this will take before it's resolved?

I give it 60 days.

Mr Zabe
11-19-2009, 01:52 PM
My two cents.
Just a few days before Thanksgiving, next week.
(Push comes to shove, Costo needs Coke products more than
Coke needs the Costo account. (I believe this point was made
in a prior post.)

DrPepperYummy
11-19-2009, 04:36 PM
Well I know people like to argue who drinks what in the customer base... but if I remember the report right from the past, it was something like 15% of your core consumer base drinks 75% of your product... and that was an insane figure to wrap my brain around... so that tells me there are a LOT of customers who will flip flop and buy the value of the week versus being that customer who will drive cross-town just to get the drink they want.

really it tells me there are so many more people who don't consume much regularly and the soda business has a lot more business it could get but just doesn't reach those people... although that depends how you look at it, the 75% of sales coming from those few, or the 25% left coming from so many different people...

popologist
11-19-2009, 10:39 PM
Well I know people like to argue who drinks what in the customer base... but if I remember the report right from the past, it was something like 15% of your core consumer base drinks 75% of your product... and that was an insane figure to wrap my brain around... so that tells me there are a LOT of customers who will flip flop and buy the value of the week versus being that customer who will drive cross-town just to get the drink they want.

really it tells me there are so many more people who don't consume much regularly and the soda business has a lot more business it could get but just doesn't reach those people... although that depends how you look at it, the 75% of sales coming from those few, or the 25% left coming from so many different people...

I don't understand your reading of those numbers. If only 15% of your drinkers are drinking 75% of your product, then that suggests to me that that 15% REALLY like YOUR product... and, therefore, WILL drive across town to find it.

I'd also argue that brand loyalty to Coke and Pepsi is probably higher than just about any other product. It's almost like political parties--almost everyone has a side in the ongoing Coke-Pepsi battle.

I've heard that stores actually put soda on sale just to bring customers into the stores, hoping they'll buy other items. Clearly, Coke wants to be in Costco, but I think Costco needs Coke more.

BottleBoss
11-20-2009, 07:22 PM
Coke can tell Costco to _ _ _ _ up a rope. You shouldn't have to constantly discount everything to the point of no or low profit just to get people to buy it. Getting a 'value' should also mean paying a fair price.

lordmadone
11-21-2009, 06:59 PM
My arguement still stands and being an individual who has actual statistical information on said statement isn't just me postulating but making an educated statement. I might be a little off on the bulk stores as I am not well acquainted but grocery stores like your supervalue chains or delhaize chains or walmarts or krogers etc etc DO bring in consumers with what is called a loss leader and that is 9 out of ten times NAME BRAND SODA! People go for the value of the week and name brand soda has the quality AND pricing to make it happen. You don't go to a damn movie theater and get generic soda or a sports complex and get the local grocery stores national brand do you? NO because there is so much affiliation with what people know is good. Most any consumer will tell you(being in the business first hand myself for 6 going on 7 years) that they get whats on sale that week!!! Yes you get your die harders but they don't account for the majority of what is bought. People do flip flop..yes but name brand sodas hold 97% of the market share as opposed to generic because people relate to them.

I think its more of a cultural thing then anything else..but many times the name brand sodas have sales that are better bargains than the national brands can even consider BUT on a consistent basis the generic brands are always cheaper..thats why they are there and HARDLY ever bought..even in this current economy. What you seem to misunderstand is that people who go to bulk stores are not going to just STOP and go elsewhere for their soda..they will pick that up elsewhere OR Pepsi/7up or whomever is there will pick up the slack..their losses will be minimal while Coke will lose out substantially. The soda market is so competitive that a consumer can find comfort in an equal product in another brand usually..because most of us know there is a taste difference however that is something people will overlook for price/convenience.

popologist
11-21-2009, 07:11 PM
What statistical data? You've presented no evidence of anything... just your opinion... just like the rest of us. :)

Mr Zabe
11-22-2009, 12:07 AM
Gosh...LOL
I could get started with my micro economic supply and demand
"elastic' curves. When fridge packs of Pepsi cost over $8, I will
most likely buy store brand soda.

juniorjin
11-23-2009, 02:46 AM
i'm not sure if anybody in this thread actually shops at Costco
but if you think about it,
it doesn't mean that you are going to go to Costco any less just because they don't carry Coke products no?

They still have enough other reasons to entice you to go back there over and over again, so for those that says Costco needs Coke more than Coke needs costco, I would think again.

For any consumer or small business that needs Coke products, they don't go to Costco just because they want to buy Coke.

IF i were pespi or other companies i would
a) pounce on this opportunity pronto
b) accomodate costco as much as possible (costco tries to get the best deals not for their own benefit, but guess what, for their customers)

Costco makes most of their profit from selling memberships, and just because they can't get COKE products (remember for most other brands of beverages, minus Coca Cola) most of the brands are essentially complementary. They don't have Sprite, most likely people will buy Sierra Mist. They don't have Powerade, guess what, hello Gatorade.

Besides, I, as a Coke customer appreciate Costco's stand. Coke is expected to significantly raise their prices on alot of products (especially here in Canada) so i am really scared for it.

greg
11-24-2009, 11:53 AM
I for one hope that Coke stands their ground on this one. Overall I do not think it will hurt Costco's bottom line, however, it will send a message to other retailers that beverage companies will not be forced to run their business the way the retailer wants them to. Let them provide loss leaders on Toothpaste and toilet paper....why does it always have to be the soda companies( rhetorical,please don't answer, I know why they do it)

lordmadone
11-26-2009, 03:30 PM
Popologist I am sorry I cannot provide links because I recieve research through my company funded by independent surveys coupled with statistical information compiled from grocery chains and other such outlets that sell soda/beverages. My only wrong quote is the 97% market share of premium brand sodas..they hold 93% actually but still vastly superior by any means.

popologist
11-26-2009, 05:09 PM
Popologist I am sorry I cannot provide links because I recieve research through my company funded by independent surveys coupled with statistical information compiled from grocery chains and other such outlets that sell soda/beverages. My only wrong quote is the 97% market share of premium brand sodas..they hold 93% actually but still vastly superior by any means.

Don't sweat it man. I'm a law student and trained to argue things to death... sometimes when I don't even believe my own argument. lol

I was just bustin your Bawls root beer. ;)

fusion
12-10-2009, 04:24 PM
A deal has been struck - Costco will begin selling Coke products on Monday.

UPDATE 1-Costco to resume stocking Coca-Cola drinks | Reuters (http://www.reuters.com/article/idCNN1020190520091210?rpc=44)

Neither side will comment on the deal - but I guess the real way to tell will be if you see a change in the shelf prices. Maybe any board members who are Costco shoppers could chime in on that.

popologist
12-11-2009, 11:01 PM
and the winner is...

the consumer. :)

greg
12-12-2009, 12:17 PM
Such a disappointment. I was hoping the manufacturer would take a stand against being told what "pricing" he should recieve.