Why Coca-Cola Is Being Negatively Affected By e-Commerce Growth

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In a recent interview with Bloomberg, Coca-Cola’s CEO mentioned that the slowdown in mall traffic is affecting the company’s sales. Retail stores, supermarkets, and vending machines at mall food courts are important distribution channels for Coca-Cola, and as consumers move away from shopping at brick and mortar stores, preferring the convenience of online shopping, these channels are being impacted adversely. Further, as an increasing number of consumers order groceries online, picking up a bottle of Coca-Cola is often “forgotten.”

The company is already struggling to grow sales as consumers shift preferences towards healthier beverages. The lack of traffic in obvious locations where consumers might pick up a can of soda without much thought is impacting the company’s sales further.

Adapting To Digital Disruption

One of the key priorities for Coca-Cola is to adapt to the changing retail landscape and use technology in its favor. The company recently started using Google technology in U.S. grocery stores to deliver personalized advertisements on customers’ smartphones. The beverage giant is also looking to reduce the number of vending machines installed at various locations, as traffic in these areas declines. One key for revenue growth will be to find newer distribution channels in line with the changing landscape. This might involve introducing new packages which are easier to deliver, as customers look for online shopping and home delivery. The company is also using social media platforms actively for the promotion of its products. Even so, these efforts may not be enough to fully offset the impact of the reduced retail foot traffic.

The shifting consumer preferences towards healthier beverages and the convenience of e-commerce have impacted Coca-Cola negatively, and those trends show no signs of slowing down anytime soon. The company needs to adapt to the changing retail landscape, and innovate in terms of both product and distribution channels to drive sales in the long term.

 

 

 

 

(Forbes)

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