Coca-Cola's Team GB unites for the big push

How much is Coca-Cola’s sponsorship of the Olympic Games costing? £30m? £50m? Whatever the sum, there’s a lot riding on the Games, as this week’s results reminded us.

Lapping strong 2011 numbers, in an ultra competitive and promotional landscape, Coke’s orchestration of the Olympic Torch Relay had coincided, up to this week, with quite appalling weather. As a result, UK volumes in the second quarter were down 4.5% in the UK (in Europe volumes fell 7%). And, as The Grocer reported last week, it even lost share to arch rival Pepsi. It’s not exactly ideal preparation.

But as the greatest show on earth finally gets underway today, Jon Woods, Coca-Cola GB boss Jon Woods, and Simon Baldry, MD of Coca-Cola Enterprises, Coke’s UK bottling and distribution arm, are raring to go. And as Baldry stresses, Coca-Cola’s sponsorship should be measured not on a single quarter but in terms of its lasting legacy.

“For us, the Olympics is a turbocharger. And not just for Coca-Cola and CCE, but in the wider context of the food and drinks industry.” So how will they do it? How do they hope to help their customers? In a show of unity, Coca-Cola’s Team GB talked exclusively to The Grocer about the legacy they hope to deliver.

“London 2012 is a turbocharger. And not just for Coca-Cola and CCE, but in the wider context of the food and drinks industry”

Understandably, the phrase ‘once-in-a-lifetime opportunity’ litters our conversation. Coca-Cola expects to serve an extra 20 million servings in the various Olympics venues, and will mobilise 500 volunteer employees from within the two businesses to personally deliver and manage all soft drinks refreshments.

The core range on site comprises Coke, Powerade, Abbeywell water, Innocent juices, Oasis, Fanta and Sprite Zero. It will also offer Glaceau vitaminwater and Innocent smoothies in selected outlets. Monster and Relentless are notably absent from the squad, despite Q1 growth of over 16% within CCE’s energy portfolio.

But CCE’s drive to boost sales extends well outside the Olympic Park. For months now, sales teams have been dispatched to support retailers in the often wet and windy path of the Torch Relay, while promotional activity and in store theatre has been ramped up at all the supermarkets.

“If you go into certain supermarkets now you will see a very different fixture for soft drinks, with clear brand blocking and much more attractive displays. Retailers have shown they are willing to have a dialogue and work with us to grow the category rather than chase each other on a downwards spiral around price.”

It’s also worked hard with “literally thousands” of small players, adds Baldry, including 5,000 close to the Olympic Torch relay route. The thrust of CCE’s Chilled+ Olympics blitz in c-stores is that retailers can ramp up sales by 25% by changing their displays - no gold medals for guessing which brand features most prominently in the recommended planogram. And it’s worked, with 3.9% volume share growth of immediate consumption for Coca-Cola [Nielsen MAT w/e 30 June].

“We have tried to make sure they get the right display and are frankly putting the biggest-selling brands slap bang in the middle of that display because that’s how they are going to make more money.

“If you go into Tesco and look at the stock and then you look at a small neighbourhood store and the range management you’ve got to ask yourself what is the right decision? It’s clear which one’s right.”

Baldry appears personally offended by those who don’t share Coke’s enthusiasm for the Olympics. The Grocer’s recent survey of retailers close to the Olympic Park found more than half feared transport chaos and only half believed the games would leave a legacy.

“I was surprised. I think this is a massive opportunity for those in the neighbourhood area, who will be looking to sell impulse goods,” Baldry retorts. “Yes, there will be disruption, but disruption equals shoppers.”

And Woods talks about the connection between Coke and its consumers with equal zeal. Despite the weather, the Torch Relay has surprised cynics in its ability to engage with local communities in celebrating both the Olympics and the hidden heroes it identified, with 18 stop-offs in retail parks and supermarket car parks to ensure that retailers could take part and benefit.

“Yes, there will be disruption, but disruption surely equals shoppers”

“I don’t sense the cynicism among them. Young people are interested in sport and music and have come away with a positive message, which is a good thing.”

He also believes objections to Coca-Cola’s sponsorship along health lines have been answered. “In 1948 when we sponsored the London Olympics, all you could get was a single pack of Coca-Cola. Now there’s a whole wide range of products and 75% will be either low calorie, fruit juice, smoothies or water.”

The other pledge Coca-Cola has promised is to make London 2012 the most eco-friendly yet: committing to include 25% recycled content in its products, slashing carbon emissions, using a fleet of biogas trucks, ensuring its logistics operation is paperless, and collecting the 20 million plastic bottles from the Games, and turning them into 80 million recycled ones, within six weeks.

“The size of the operation is enormous,” Baldry adds. “But we have the most motivated team, excited to deliver an outstanding Games, and I’m proud of what they are about to do.”