Coke faces sales setback as retail chain axes brands

Somerfield has delivered a blow to Coca-Cola ahead of the “vital Christmas sales” period by axing a fifth of the company’s products from shelves and delisting two brands altogether.

Somerfield has delivered a blow to Coca-Cola ahead of the “vital Christmas sales” period by axing a fifth of the company’s products from shelves and delisting two brands altogether.

The supermarket chain is delisting Coke’s tropical fruits carbonate Lilt and also dumping a number of Fanta products such as Lemon and Apple flavours.

At the same time Somerfield is relisting two Britvic Soft Drinks brands, Tango and 7-UP, which it delisted last summer (MW July 27 2006).

The move aims to clear shelf space for rival brands and it is expected to hit Coca-Cola hard during the Christmas sales period, which is seen as the most important for the sector. One insider says that this Christmas is seen as vital for Coke as it needs strong sales for Coke Zero.

The source adds that it has struggled to gain market share from rival Pepsi Max and “needed a really strong Christmas to dispel all the worries about the product”.

According to AC Nielsen figures for the four weeks to the start of October, Coke Zero’s volume share in multiples was at 5% of the total cola category compared with Pepsi Max’s 9.7%.

A Somerfield insider says: “Lilt has massively underperformed and along with some Fanta products such as Apple flavour, will be removed.

“In addition we’ll reduce our other Coca-Cola products including Coke, Diet Coke and Coke Zero by about 20%.”

The source says the move makes sense from a soft drinks point of view. He says: “Britvic has the number one drink in the lunchbox market, the adult market and the squash market. It is also supporting the water market.

“Coke is far and away the biggest player in the declining carbonates market but it isn’t the number one elsewhere. Britvic has the broader portfolio so we’ve signed a deal that will see us through the next 18 months.”

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