Coca-Cola Enterprises’ CEO says a franchise agreement with Coke prevents rival launches products in the non-alcoholic RTD category, but nothing stops it launching drinks in other sectors.
Addressing the Barclay’s Back to School Conference in Boston yesterday, John Brock explained that the deal meant CCE was not allowed to launch competitive products in the world of colas.
The Coca-Cola Company was always CCE’s first port of call for products, Brock said, and he stressed that the vast majority of the company’s products came from The Coca-Cola Company.
Capri Sun success in Great Britain
But he added that there were situations where Coke didn’t have a product in a particular category, and then CCE had the right to put such products into its portfolio.
“A good example of that is Capri Sun. We’ve had that product successfully in our portfolio for some time in Great Britain,” Brock said.
“We’ve expanded it throughout the rest of our territories. Monster is another one in the same category.”
Although CCE’s sparkling brands and energy – Coke, Fanta, Sprite, Dr Pepper, Schweppes, Monster, etc. – account for around 86% of volumes, Brock said the firm is driving growth in stills (14%).
“We have excellent juice and juice drink brands, such as Minute Maid, Capri Sun and Ocean Spray. And then we have waters, which include Schweppes, Abbey Well and Chaudfontaine,” he said.
Clear strategic priorities
One audience member asked Brock if CCE was able to launch products beyond beverages.
“Absolutely, yes,” he replied. “The contract only covers beverages, has nothing to do with any other adjacencies or categories that are even further afield.”
Strategically speaking, does CCE have an appetite to explore product categories besides drinks?
“Well you never say never,” Brock said. “But I think I’ve been pretty clear over the years in terms of our strategic priorities.
“It’s expanding our geographic footprint in Western Europe, if we can do so at attractive economics. I would be broadening our product portfolio in Western Europe, if we can do so at attractive economics,” he added.
“And beyond that, it would be our footprint in the rest of the world.”