The digital future is now

by Keith Nunes
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KANSAS CITY — The Coca-Cola Co.’s reintroduction of Surge, a citrus flavored carbonated beverage it discontinued in the early 2000s, may not have garnered the same amount of attention as the Twinkie’s return, but it is a launch worth watching. The entire marketing program around the revived product line will be digital and may lay the groundwork for future marketing efforts.

“If expectations are met, this may be only the first of a variety of efforts we explore to launch niche products through e-commerce relationships,” said Wendy Clark, president of sparkling and strategic marketing for Coca-Cola North America. “This will be a great learning experience for us and a refreshing opportunity for fans.”

Coca-Cola is partnering with the on-line retailer Amazon to offer 12 packs of 16-oz cans, and the company is relying on social media to drive attention.

The program capitalizes on fans of the product who started what they call the “Surge movement” on social media when the product was discontinued. As a result of consumer efforts, the discontinued brand amassed 128,000 followers on Facebook.

“In this new era of marketing, we’re exploring segmented delivery of our portfolio to consumers,” said Racquel Mason, associate vice-president of sparkling flavors, Coca-Cola North America. “Previously, a smaller brand would never have had a realistic shot at commercialization. Now with Amazon, consumers can order a product like Surge and have it delivered directly to their doorstep. It’s the democratization of demand.”

Food and beverage companies are trying to better understand the digital marketplace, and Coca-Cola’s effort with Surge indicates the company is ready to be more aggressive in digital marketing. The company’s efforts come on the heels of a report published in late August by the Grocery Manufacturers Association that recommends consumer packaged goods companies become more comfortable with digital marketing and sales.

The G.M.A. report, titled “The digital future” shows that the impact of digital media is felt most acutely at the early stages of the purchasing pathway. Almost 40% of off-line shoppers and more than 30% of on-line shoppers reported that technology's impact is greatest during the discovery phase, according to the report. More than a quarter of both off-line and on-line shoppers said that its biggest impact is in the search phase.

In addition, almost a quarter of in-store shoppers reported on-line activity as one of the three most influential factors on their purchasing pathway. Digital channels currently have the greatest influence on purchases of home care and general food products but are likely to expand in importance during the next five years.

“The cost of inaction for incumbent manufacturers is ceding control of their brands, share position, and margins in the fast-growing digital channel,” said Jamil Satchu, a partner at I.R.I. Global Analytics and Consulting and a co-author of the report. “Companies that do not play in the digital game are likely looking at flat or shrinking sales.

“Brand equity is at risk as the purchasing pathway shifts on-line and consumers more often search for and discover brands digitally, but the experience of other sectors demonstrates that early movers often establish tough-to-trump positions and advantages.”

To download the “Digital future” report, click here: The Digital Future.
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