Coca-Cola threatens legal action over juice packaging

- Last updated on GMT

Related tags: Orange juice, Market share, Coca-cola

Coca-Cola is suing rival US beverage manufacturer Florida's Natural
because it believes the company has infringed on the patented
plastic carafe used by its Minute Maid Simply Orange juice brand.

Coca-Cola​ spokesman Ray Crockett told Florida-based news service The Ledger​ yesterday that the company believes Florida's Natural is attempting to take advantage of the success of the Simply Orange brand, which he attributes partly to the innovative packaging.

Indeed, since the introduction of the distinctive plastic carafe, Simply Orange sales have increased by at least 10 per cent annually.

For its part, Florida's Natural says that it buys carafes from Plastipak Packaging, a US company that sells more than 7 billion plastic containers a year. According to The Ledger, Florida's Natural assumed Plastipak had the legal right to sell that product. Plastipak is not named in the lawsuit.

The controversy underlines the role packaging is increasingly playing in establishing brand identity and achieving market share. This point has continually been raised in design seminars, which have identified a major shift in the last 20 years towards packaging as the key brand communication tool.

Tim Greenhalgh, managing creative director of UK-based design firm Fitch for example, has said that the public is both excited and saturated by brands, and that consumers think there is very little difference in the marketplace. Packaging has become the means by which manufacturers can differentiate their product from the competition, and communicate to the consumers a desired image.

Both Simply Orange and the Florida's Natural brands are not-from-concentrate (NFC) orange juices. NFC orange juice is the only form of the beverage that has enjoyed consistent sales growth during the past decade, and its success has made Florida's Natural the third largest citrus juice seller in the US behind Pepsi-owned Tropicana Products and Minute Maid.

The success of the NFC sector, and the willingness on the part of Coke to protect what it perceives as a unique marketing tool, also shows how orange juice manufacturers are trying to move from a commodity market into a value-added sector of the beverage market, and how keen they are to protect their market share.

This is the latest legal case that Coca-Cola has been involved in. The soft drinks giant recently settled a five-year European Union antitrust case by promising to scrap controversial retail discounts and by agreeing to share more display space with rivals.

The settlement is designed to increase competition in the European carbonated-soft-drink market, where Coke still holds a near-50 per cent share. PepsiCo, which complained to the EU about Coke's sales and marketing practices in the late 1990s, has less than 10 per cent.

PepsiCo has consistently contended that it faces unfair barriers to competition in the market for cola drinks in Europe, where its market share is far smaller than in the United States. The company complained that rivals have been shut out because shoppers are drawn to the Coke rack without bothering to look at rival offerings elsewhere in the store.

Related topics: Carlsberg, Juice Drinks

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