Coca-Cola Releases Single With Latest Advertisement

Coca-Cola has launched a new music single to accompany the release of their third “Happiness Factory” commercial.  This jingle features established artists (Cee-Lo Green of Gnarls Barkley, Patrick Stump of Fall Out Boy, Brendon Urie of Panic at the Disco, Travis McCoy of Gym Class Heroes) and the up-and-coming Grammy nominated songstress Janelle Monae.  This single was produced by Butch Walker and Polow Da Don, who have worked with artists like Usher, Fergie, and Avril Lavigne.  The original song and the remix version can be found here.

Umut Ozaydinli, global music marketing manager of  The Coca-Cola Company says, “Adding a musical element to our popular Happiness Factory franchise is a natural progression to really making it a trans-media property.  Working with established artists like Cee-Lo Green and Patrick Stump of Fall Out Boy and up and coming artists like Janelle Monae really brings together a unique mix of genres of music. Our new campaign is all about inviting people to share a little happiness and enjoy life’s simple pleasures. We believe that, through the use of music, we are able to enhance this message and help people to connect and have fun with the campaign.”

Music will be embedded into the Open Happiness campaign. The track will appear as the soundtrack to the new Happiness Factory TVC and be utilized as a vehicle outside of traditional advertising. In addition, a percentage of the single sales will be donated to charitable causes through the Company’s ‘Live Positively’ platform.

To support the release of this single, Coca-Cola has implemented a global marketing efforts which include:

• a Myspace premiere of the single on March 16th, at http://www.myspace.com/openhappiness
• an iTunes release, bundled with the behind-the-scenes “the making of” video
• 200 million packs of Coca-Cola products in France and Great Britain promoting the new single
• a music video premiere of the single in May (more news about premiere as it nears)
• intergration into Coca-Cola’s radio and online marketing efforts
• promotion at London’s Piccadilly Circus and New York’s Time Square

The release of this single is significant for the company and the brand.  Unlike the other two Happiness Factory commercials, this commercials features lyrics to accompany the five-note melody.  This allows consumers to develop an even closer relationship with the product because there’s less mystery and ambiguity between Coca-Cola and the consumer.

Also, Coca-Cola has established a relationship with music artists and producers, and will be able to use music artists to promote their beverage products.  Coca-Cola may also continue this relationship with other artists and producers to create other singles.  A suggestion may be to create singles that are geographically focused, and use artists from that region and convert it into the local language (ie. Chinese music artists for China, Indian music artists for India, etc).

Good move on the company’s part, can’t wait to see the music video!

The Bottled Water Industry

Canadean recently published a report claiming that the global bottled water market’s growth has slowed down.  The majority of the affect will be experienced in USA, where Canadean estimates only a 1% growth over the new five years (after seeing double digit growth rates since 2008).  This decline in growth cites environmental concerns and the current economic conditions, leading consumers to switch over to tap water instead.  The report’s summary and highlights can be found here.

While this report may be correct in its claim about decelerated growth of the bottled water market,  their metric is PET bottles.  Does the report base the bottled water’s growth on the growth of PET bottles then?  Using this metric may require some more explaining, because carbonated soft drinks (CSDs) are also produced in PET bottles.

After scouring the internet for more research, a 2008 Datamonitor industry profile report offers these facts about the bottled water industry:

• Global bottled water market size –  The current market size is roughly $66 billion in 2007, with expectations of $94 billion by 2012.  Global market volume (in litres) is about 120 billion litres in 2007, with expectations of 160 billion litres by 2012.
• Market segmentation – The majority of sales (67%) is generated by regular, unflavored water, while sparkling unflavored (28%), sparkling flavored (3%), and still unflavored (2%) make up the remaining 33%.  European consumers account for 50% of the global market value, while North/South America represent 32.5%, and the remaining parts of the world account for 17.5% (namely Asia).

• Major market share leaders: Nestle (21%), Danone (12%), Store brands or private labels (8%), and Coca-Cola (7%).  Nestle’s water portfolio is represented by over 72 brands, mainly Nestle Pure Life, San Pellegreno, Perrier, Montclair, and Vittel.  Danone’s water portfolio is mainly represented by Evian and Volvic.  Coca-Cola’s water portfolio is mainly represented by Dasani, BonAqua, and Glaceau.

It’s interesting that Nestle – known more for their confectionary items – is the market leader in the bottled water market.  However, researching this further, it comes as no surprise.  Nestle has a separate business unit that handles the bottled water operations.  This business unit invests significant resources on research and development to find a long term solution to lower their material costs.  Their most recent innovation saw the development of sustainable packaging that uses 40% less plastic but still retains the bottle’s strength and sturdiness.  Nestle’s bottled waters are inexpensive compared to other brands.  Add in the fact that you can buy store brand bottled waters even cheaper than Nestle,  people may just buy bottled water instead of drinking tap water.

Your choice: tap water or bottled water.  Almost the same price.

Coca-Cola Huiyuan Juice deal falls through

China’s Ministry of Commerce released a statement today blocking the acquisition of Huiyuan Juice, one of China’s largest 100% juice brands.  The Ministry of Commerce claims that through the acquisition, Coca-Cola would become the dominant player in the market.  And through this dominant position, Coca-Cola may potentially make it tougher for competition, coercing consumers to pay a premium price for beverage products.

CEO Muhtar Kent released a statement saying, “We are disappointed, but we also respect the MOC’s decision.”  China represents Coca-Cola’s fourth largest market, and Coca-Cola will undoubtly make a push toward some other Chinese beverage company to increase its presence in the market.

The breakdown of this deal may actually be a blessing in disguise for Coca-Cola.  This deal was first announced in September 2008, before the full effects of the worst economic conditions since the 1940s.  The deal if completed may have beocme too expensive for Coca-Cola given the economy’s current situation.  In addition, Huiyuan Juice’s growth trend have slowed since the September acquisition news.  The company experienced lower sales in the first two quarters of 2008, and lost market share in the low end fruit juice segment (which accounts for the majority of the company’s revenues).

Until another acquisition is made, the company will increase its focus and promotions for exisiting products.  Coca-Cola currently leads the diluted juices market with 9.7% market share.

Innovative packaging: a donut plastic bottle

The Martin Lindstrom report recently published a video on Stefan Linfoss, an entreprenerial designer that created a plastic bottle in a donut shape.  Linfoss claims the bottle serves both functional and environmental aspects.  The functional side being that the plastic bottle is “stackable”, where one bottle can be placed on top of another bottle.  The environmental aspect is that a portion of the revenue from each bottle sold goes toward an environmental organization.

The bottle itself holds 400ml of liquid, has a plastic cap in the shape of a starfish, and is made from a recylcable material called HDPE (high density polyethylene).  PLUP currently is the only company that is using this new plastic bottle for water, with extensions to include juices coming.

The bottle itself is a refreshing idea and also has abundant opportunities for extensions.  For example, to raise awareness or campaign for breast cancer, the donut bottle can be colored pink and serve water or juices.  Or to celebrate Christmas, the bottle can be decorated in the shape of a wreath, or manufactured into a different shape altogether (say a Christmas tree).

However, there are a few drawbacks of this design.  The current format only holds 400ml of liquid and the average bottle size is 500ml – would a larger bottle be uncomfortable for the user to either hold or carry?  Also, while the shape is innovative, it may be for that reason that beverage companies do not commit to using this bottle for fear of alienating the consumer base.  The bottle would only appeal to premium or specialty beverage companies (maybe Evian given its history of designer bottles) and produced in limited quantities.

• The 8-minute Martin Lindstrom interview with Stefan Linfoss can be found here.
• More pictures of this donut-shaped plastic bottle can be found here.

Pepsi introduces nostalgia for a limited time

Pepsi will be introducing three new products for a limited time starting in March and April.  These three beverages are: Pepsi Natural, Pepsi Throwback, and Mountain Dew Throwback.

Pepsi Natural is a beverage made out of all natural ingredients, such as natural sugar, natural caramel, and kola nut extract.  This cola will be launched in 10 American regional markets (Chicago, Cleveland, Las Vegas, Los Angeles, New York, Pittsburgh, Portland, San Diego, San Francisco, and Seattle) and will be available in 4-packs and single-serve.  This drink can be found in the premium and natural foods aisles inside retailer’s stores.  Pepsi Throwback and Mountain Dew Throwback are two beverages that target nostalgia.  These drinks’ packaging appear classic, similar to the packaging from the 1960s and 1970s.  These two beverages also contain natural sugar in their formula.  The Throwbacks – which can only be found in the US – will be available for an 8-week duration starting April 20.

These drinks should appeal to the general consumer, but Pepsi appears to be mainly targeting those that already have experience with the brand.  These innovations are targeting nostalgia with the Throwbacks’ classic packaging and the Pepsi Natural’s glass bottles.  At the same time, the beverages’ formulation with natural ingredients indicates health and balance, thus allowing the drinks to appeal to the younger generation.  The limited time offering will also spur sales because it may serve as a keepsake novelty item for Pepsi product collectors.

Pepsi seems to be on the right track with these innovations, connecting with the older generation and also reaching out the youths of the current generation.

Aluminum cans’ BPA levels no big deal

First of all, what is Bisphenol A and what harmful effect does it cause?  Bisphenol A (BPA) is a coating inside aluminum cans that protects the beverage content from making direct contact with the metal.  At an elevated temperature, BPA may migrate from the aluminum can over to the beverage, thus posing a health risk.  Harmful effects from BPA exposure include increased risk of cancer and infertility.

Health Canada recently released a report saying that the BPA levels found inside soft drink plastic bottles and cans are not harmful enough to cause health concerns.  The study finds that the tolerable intake amount is 25 micrograms per kilogram of body weight, in a single period of consumption.  The average individual (weight = 60kg) would need to consume 7,400 355ml aluminum cans in a single serving to pose a health risk.

The study measured the different levels of BPA found in products and over 85% of tested products contained less than 1 microgram in the aluminum can.  Rockstar Energy tested to contain the highest BPA level at 4.5micrograms, while Diet Dr. Pepper tested to contain the lowest BPA level at 0.032 micrograms.  For the complete list of tested product, follow this link.

So as the report has confirmed so far, it is safe to drink soft drinks from aluminum cans.  Drink as much as you can. =)