The newest Coke brand in Coca-Cola's stable is exceeding expectations, claims the beverage giant, after investment bank Credit Suisse estimated that Coke Life has fallen short of its other launches, Coke Zero and Vanilla Coke.
Fairfax's The Sydney Morning Herald is reporting that Coke Life has sold seven million litres of the product over five weeks, compared with 14 million litres over the same time period for Vanilla Coke after its launch in 2005.
Coke Life also sold well below the 30 million litres of Coke Zero sold in its first few weeks in shops.
The Eureka Report outlined that Credit Suisse said: “The broker's channel checks reveal repeat purchases of Coke Life are probably short of expectations. Investors are warned to be cautious about anticipating a positive earnings surprise for either the half or full year.”
The investment bank also overnight upgraded its share predictions to neutral from underperform, given the fall in the share price recently.
The company has hit back at the claims that the product is underperforming, with a spokesperson telling AdNews: “Coke Life is exceeding our expectations. While it's still early days, we've seen a very positive response from the Australian market.
“Our expectations would be for Coke Life to represent 1-2% of total brand Coke volumes, similar to levels achieved in the UK.”
To launch Coke Life, Coke rolled out a multimillion-dollar marketing campaign and Coca-Cola's South Pacific marketing director, Lisa Winn, told AdNews at the time that a key indicator for the success of this new product and its roll-out will be how the sales of the other Coke brands fare.
“Great Britain also launched this product and an early interesting impact on the launch of Coke Life has created a halo around the whole Coke trademark,” Winn said.
A Coke spokesperson confirmed that saying: “Already we are seeing encouraging signs that Coke Life is having a halo effect on the total Coca-Cola trademark.”
Group managing director Alison Watkins expressed a similar sentiment during Coca-Cola Amatil's AGM earlier this month, when she said that Coke Like was currently tracking above target.
“It’s our second-most bought pack in 1.25L and 250ml pack sizes and has gained a 13% share of the Sugar Cola segment,” Watkins said.
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