Back in July this year, Coca-Cola decided to discontinue its juice and smoothie business, Odwalla.
The president of Coco Cola’s Minute Maid business unit, John Hackett spoke on the subject and said that the decision was not easy. He also added that they tried their best to continue production but were forced to come to this decision because of rapidly changing market trends.
The company has tried its best to adapt to the trends for example; they introduced a kombucha line and zero-sugar smoothies and juices. They have also replaced concentrates with pure squeezed juice and have even tried changing their bottle design. However, all of this has been to no avail.
The spokesperson for the company explained that the decision to shut down Odwalla was not linked to the pandemic, as many may assume. Their main concern was that people are becoming increasingly health-conscious and do not prefer to buy smoothies and juices from stores.
The USDA reports that in 2017, fruit juices consumption was the lowest per capita. Customers are concerned about the high sugar causing obesity and heart disease. Some of Odwalla’s juices have sugar content as high as 58 grams.
Moreover, among the brands that sell pure juices, Odwalla is not among the top contenders, ranking 7th in the list.
Even though the company claims this is not related to the pandemic, most companies nowadays are trying to improve their processes and operations in order to increase efficiency and to instead shift focus on products with higher demand.
The CEO of Coke has also spoken on the subject, explaining that focusing production on their key brands has proven to be an advantage for customers. He also adds that improving their supply chain will also result in greater success for the company.
The company will also be getting rid of the distribution network that supplied Odwalla products, which were 230 refrigerated trucks.
Coca-Cola has a history of discontinuing brands that do not perform well, and they call it a ‘zombie brand’ strategy which entails that the company shuts down brands that have not made significant progress in 3 years.
In 2018, the company shortlisted 125 SKU’s that was not performing up to the mark and discontinued 60% of them.