Coca-Cola indicates intent to push marketing spend back to pre-Covid levels
Global beverage giant, Coca Cola, revealed that its revenue was down 11% in 2020, but maintains a positive outlook for resumption in pre-pandemic marketing investment as vaccines are rolled out globally.
Coca-Cola doubled down on its strategy to cut down its portfolio and switch investment to its core brands, while also planning to bring marketing investment levels back to pre-pandemic times to boost growth.
Speaking on this recently during a call with analysts following the announcement of the company’s fourth quarter and full year results, Chairman and CEO James Quincey said the company’s long-term growth will be “powered” by its core brand portfolio. The company slashed its portfolio from 400 brands to 200 last year.
Quinecy explained that the streamlining of brands allowed global category teams to “identify the greatest opportunities” and “allocate investments accordingly”.
“Targeted investments will leverage our leader brands more effectively, convert challenger and explorer brands into leaders more quickly and consistently.”
“Additionally, our portfolio streamlining allows us to focus attention and resources on what we do best – brand building and innovation. This will make room for more consumer centric products down the road,” said Quincey.
He signaled the company will look to increase marketing budgets again to levels seen in 2019, but only once the vaccination rollout is more progressed and lockdown measures are eased. For comparison, the company spent around $4.3bn (£3.1bn) on marketing in 2019.
He said marketing investment will need to be at “similar” levels to those seen in 2018/2019 in order to “drive top line and margin increases” consistent with the company’s growth forecasts.
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