Nielsen Numbers: Led by Coke, CSD Sales Remain on a Rebound

WellsFargo 150For the second straight month, carbonated soft drinks (CSD) saw a bump in dollar sales, according to a new Wells Fargo Securities report which dissected Nielsen xAOC (expanded all outlets combined) and compared year-over-year data for the four-week period ending on Aug. 30. The 0.2 percent increase was driven by a relative surge in sales of the Coca-Cola Co.’s CSD products, which grew by 3.7 percent in dollar sales and 2.4 percent in volume sales on a 1.4 percent jump in pricing.

Wells Fargo Securities analyst Bonnie Herzog, who authored the report, pointed Coke’s “Share a Coke” campaign as having a strong impact on its flagship brand, which saw dollar sales soar by 8 percent in the period. The marketing program encourages consumers to share with friends and family limited-edition 20 oz. bottles of Coke, Diet Coke and Coke Zero. In place of Coke logos, the front panels of the labels include popular first names among teens and Millennials as well as nicknames like “Bestie” and “Wingman.” Herzog noted that Coke “gained over 1.5 points of volume/value share this period, an encouraging sign.”

Share a Coke

Backed by strong growth of its Gold Peak brand, dollar sales of Coke’s tea portfolio rocketed by 37 percent, an impressive showing that undoubtedly allayed some concerns about a sluggish month for the company’s sports drinks, sales of which fell by 4.9 percent.

Meanwhile, Herzog pointed to a 28.9 percent boom in dollar sales of Coke-owned energy drinks as bearing future rewards for Monster Beverage Corp., in which the energy giant will absorb Coke’s highly caffeinated offerings next year, based on the companies’ recent alliance. Last month, Coke acquired a 16.7 percent stake in Monster and the two companies agreed to swap their non-core portfolio brands in a deal worth $2.15 billion. Monster has continued to live up to its namesake, with dollar sales up a roaring 12.3 percent in the recent four-week period, based on 1.8 percent growth in pricing and 10.3 percent growth in volume.

Although PepsiCo experienced a 4.9 percent decline in volume sales of its CSD products, the company’s vigorous approach to pricing (up 3.2 percent in the period) helped to offset the drop, leading to a 1.8 percent slide in dollar sales of the drinks. The rest of Pepsi’s drink portfolio fared significantly better, and contributed to an overall increase of 1.1 percent in dollar sales of its beverages. Gatorade and its isotonic brands remains a positive spot for the soda and snack giant, with dollar sales up 5.6 percent, while Pepsi’s tea and energy brands also saw a nice jump, up by 10.8 percent and 15.7 percent, respectively.

As for Dr Pepper Snapple (DPS), the numbers painted a less rosy picture, with Herzog noting that Wells Fargo remains “concerned about the ongoing deterioration” of the company’s CSD business. Total sales of DPS beverages fell by 1.3 percent in the period with CSDs (down 1 percent), tea (down 4 percent) and juice (down 1.9 percent) all contributing to another weak showing for the company.