With a growing number of consumers purchasing their groceries online, Coca-Cola is finding more ways to embrace a digital future — and make sure it doesn’t get left in the past.
The maker of Sprite, Fanta and its namesake cola has spent decades developing packaging and retail displays that grab the attention of the consumer in places such as the checkout line and the convenience store. The challenge today is taking this way of thinking and moving it online. To do that, Coca-Cola executives said the company must focus on a two-pronged approach — how the consumer buys an item and the way in which he receives it.
“A big piece of the business is going online, whether that is brick and mortar or whether it’s pure players like Amazon, so not being online means your brands are not being as relevant,” John Carroll, general manager and vice president of e-commerce for Coca-Cola North America, told Food Dive. “We’re following the consumer and where they’re going.”
Kantar Retail estimates e-commerce today comprises just 2% of grocery sales, meaning there is plenty of room left for growth. It’s expected that 20% of all grocery sales, representing around $100 billion, will come from online shoppers by 2025, according to data from the Food Marketing Institute and Nielsen.
This future, and the revenue that comes with it, has attracted the attention of other companies beyond Coca-Cola. Campbell Soup has been bulking up its online business, highlighted by hiring a former Amazon and eBay executive for a newly created role that oversees digital and e-commerce initiatives.
Kellogg is also revamping its business model for e-commerce. The company announced earlier this year it would end direct-store delivery for its snacks division, and instead shift resources and efforts to direct-to-consumer marketing. The manufacturer of Pringles, Pop-Tarts, Cheez-It and Nutri-Grain said during its second quarter that U.S. e-commerce sales grew by 70%, and its global experience suggests it can capture more share through click-and-collect programs than in stores.
“A big piece of the business is going online, whether that is brick and mortar or whether it’s pure players like Amazon, so not being online means your brands are not being as relevant. We’re following the consumer and where they’re going.” John Carroll
General manager and vice president of e-commerce, Coca-Cola North America
Coca-Cola, which thrives on impulse buys, is involved with nearly every way consumers are reallocating their purchasing power. The 131-year old company showcased at its investor day earlier this month how it is pairing its drinks with a meal kit while also demonstrating a voice ordering system that suggests adding a cold Dasani water at the end of the order.
And when a consumer uses a storage locker, the individual can be asked if he wants to buy a drink to go along with the purchase as he gets closer to picking up the order. The beverage can be added within two minutes.