Coke turns to new packaging in crowded beverage market

ATLANTA - For most of us, the shape of a 2-liter bottle is something we take for granted.

For Hendrik Steckhan, head of carbonated soft-drink brands for Coca-Cola North America, the shape is a problem. Coca-Cola should not be in the same 2-liter bottle as every other brand, he said.
“When you think about this, it just doesn’t make sense,’’ Steckhan said.
Faced with a nagging decline in North American sales, Atlanta-based Coke and its bottlers are turning to packaging as a key way to set their products apart and try to generate fresh appeal.
Consumers will see more sizes and bundles of Coke products at supermarkets and convenience stores. The iconic contour shape also will become even more prominent. A 2-liter contour bottle, already in Birmingham, Ala., and Chattanooga, Tenn., is being added to Atlanta in July.
The push for what’s called “package diversity’’ is significant, and the stakes are high.
Across the industry, US sales of carbonated soft drinks have declined for four straight years, according to figures from Beverage Digest, a New York-based trade publication. PepsiCo, Coke’s chief rival, also is using packaging, including new logos and different package sizes, as part of a strategy to revive soft-drink sales.
For years Coke has relied on a wide range of package sizes overseas. It can easily be found in more than a dozen can or bottle sizes.
The North American market, by contrast, is dominated by three packages: a 2-liter straight-walled bottle, a 12-pack of 12-ounce aluminum cans, and a 20-ounce plastic bottle.
Coke executives attribute the difference to a highly competitive US market where Coke and Pepsi have battled for decades.
“There was a point in time when value was defined as more - more ounces for less [money],’’ said Ralph Kytan, vice president of Coke’s North American bottling operations.
Coke hopes to rewrite the value equation.
“Package diversity is about matching up the benefits of the package with the needs of the purchaser for the occasion they’re buying for,’’ Kytan said.
At convenience stores, the 20-ounce is the top-seller, but its price of more than $1 has hurt sales. A teenager looking for a more affordable option might grab a 16-ounce bottle priced at 99 cents, Steckhan said.
At the grocery store, the 12-pack and 2-liter are the top sellers. But the 50-ounce twin-pack might be more appealing for smaller families, he said. One bottle can be shared for a meal, leaving the other unopened and fresh for the next meal.
Coke also has high hopes for its 2-liter contour, Steckhan said. The original contour glass bottle was created in 1916 to help Coke stand out from the pack.