The National Association of Convenience Stores (NACS) trade show is always one of The Coca-Cola Company’s biggest annual platforms for RTD beverage innovation — seemingly moreso when the event is in Coke’s hometown of Atlanta. Yet this year’s NACS show, held October 2-4, proved to be the soda giant’s biggest stage yet, featuring its biggest-ever roster of new products set for launch early next year.
In this interview recorded at the show, BevNET managing editor Martin Caballero spoke with James Ford, Coca-Cola’s VP of category strategic advisory, about the company’s NACS product showcase, including the highly anticipated U.S. launch of Coca-Cola Energy in January 2020, the development of Coke’s expanding coffee portfolio, and how the brand is strategizing for growth in the convenience store channel.
The U.S. debut of Coca-Cola Energy marks a significant new chapter for the company. Available in 12 oz. sleek cans, each with 114 mg of caffeine per serving, the line is aimed at shifting legacy Coke drinkers into the energy space with a flavor profile similar to the classic soft drink taste. Ford said he is optimistic that the product can grow the category incrementally and without negatively impacting the performance of Monster Energy, in which Coke is an investor and distribution partner.
“We in no way want to slow down the growth engine that is Monster,” Ford said. “With less than 50% of households in the category, we think there’s plenty of room for these brands to grow and exist at the same time. We really see this as an additive proposition, not an either-or.”
Coca-Cola’s coffee strategy is changing as well. At last year’s show, the company teased cold brew products coming under the Far Coast banner, but those plans have since been shunted to the side. Instead, Coke is going deeper in its relationship with Dunkin’ Donuts with the launch of a lightly sweetened cold brew available in two varieties: Caramel Black and Midnight Black. The former contains 40 calories and 10 grams of added sugar, while the latter has 30 calories and 7 grams of sugar. Each has 152 mg of caffeine per 9 oz. aluminum bottle. Bottles on display at NACS were marked as “Product of Japan,” though reps said that would not be the case for the final product.
The launch of Dunkin’ Donuts Cold Brew extends the joint partnership between the Massachusetts-based cafe chain and Coca-Cola for RTD coffee products, which began in 2017. The collaboration has thus far been at least fairly successful; according to sales data from IRI through August 11, Dunkin’ iced coffees have generated over $147 million this year, despite a slight decline from the same period last year. That includes a line of sweetened shelf-stable iced coffees in 13.7 oz. PET bottles, positioned to compete directly with Starbucks-branded products distributed by PepsiCo. A second product line — a three-SKU line of blended espresso and milk beverages in cans, called Shot in the Dark — debuted last year.
As the relationship moves forward, the questions now seem to surround Coke’s shifting coffee portfolio. Just a few weeks ago at Natural Products Expo East 2019 in Baltimore, Coke introduced Honest Cold Brew Coffee, which has launched in on-premise locations on the West Coast. That product, which is organic, Fair Trade certified and sold in glass bottles, is positioned as Coke’s premium option in the category. Still more disruption is likely on the horizon through Coke’s other coffee partners: the soda giant also manufactures and distributes RTD beverages under the McDonald’s McCafe banner, and is set to release a range of coffee products, including RTDs, from Costa Coffee in Europe sometime next year. Recall that Coke acquired London-based Costa for $5.1 billion in August 2018, the largest purchase in the company’s history.
Outside of coffee, Coke’s innovations echoed the company’s oft-repeated mantra of “total beverage.” Coca-Cola and Sprite remain the company’s flagship CSD lines, and each will see the release of limited edition seasonal flavors that launch on September 30: Sprite Winter Spiced Cranberry Sprite and Cinnamon Coca-Cola. Another new flavor — Cherry Vanilla Coke, available in original and Zero Sugar varieties — will debut in February 2020 as a permanent addition to the line.
But innovation also came from the other end of the spectrum with better-for-you, reduced sugar drinks. Odwalla will release a three-SKU line of smoothies called Zero Sugar, which will feature 100-110 calories per 12 oz. PET bottle, depending on the SKU. The keto diet-friendly products will be available in three flavors: Strawberries & Cream, Vanilla Matcha and Dark Choco-Berry. The entire line is sweetened with sugar alcohol (12 grams per serving) and 5 grams of protein from a blend of rice and pea-based sources.
Meanwhile, Gomega is a brand new line that attempts to position Coke to compete with Bai and other flavored antioxidant beverages. Labeled as an “omega-3 superfusion,” the products offer 32 mg of DHA Omega-3 per 16.9 oz. PET bottle, with claims of “2x more antioxidant vitamin C” than “leading antioxidant beverage.” All three fruit-based flavors — Berry Acai, Strawberry Guava and Mango Passionfruit — contain 25 calories and no more than 2 grams of sugar each, and are sweetened with a blend of allulose, erythritol and stevia.
Further afield, Coke also showcased new still flavors for smartwater — Pineapple Kiwi, Strawberry Blackberry, Cucumber Lime and Watermelon Mint — set to debut in December 2019.