The Coca-Cola Company’s strategy of reviving returnable bottles for the Latin American market in conjunction with the two largest bottlers in the region, Coca Cola Femsa and Arca Continental, has served as a ‘lifesaver’ in the midst of the Covid pandemic- 19. In recent weeks these bottles It has allowed them to offer better prices.
In the case of Coca-Cola Femsa, which belongs to the Mexican Economic Development (FEMSA), said that returnable bottles and multi-pack presentations have helped them offer “magic prices” in all the markets where it participates.
“Returnables already appeared with more than 25%, during the second quarter in Mexico and more than 20% in Brazil, leading our Brazilian market to achieve a record share of sales in the soft drink category. These initiatives combined with a relentless execution of the sale and a reinforced position in the direct channels to the consumer are providing an additional impulse of in the participation in the market “, Coca-Cola Femsa said in his conference with analysts to discuss the results of the second quarter of the year.
Returnable bottles are part of the objectives of “A World without Waste” that Coca-Cola established for 2030, where the Femsa bottling company committed to achieving by that date at least 50% of all its recycled PET material.
“Returnable packaging is definitely a positive thing in terms of the environmental impact it has on the behavior of ecological connotations that consumers are rediscovering around returnable packages,” Coca-Cola Femsa executives said at their conference.
They are also making disruptive plays with “Universal bottles” since they can use the bottles for different brands and an expanded portfolio easily.
Read: Coca-Cola is for the return of returnable packaging in Mexico
“We have an excellent and solid base in returnables, we believe that we will continue to expand it and it is also important understand that we are very good at it and that we are very focused on improving. So returnables are an interesting move, it doesn’t seem very innovative because it’s always been there, but there is a lot of innovation behind the platform upgrade and expansion. That is something we also want to make sure is broadcast, ”added the company at its conference.
Coca-Cola Femsa, is the largest bottler of Coca-Cola products in the world by sales volume. The company produces and distributes beverages of The Coca-Cola Company trademarks, offering a broad portfolio of 129 brands to more than 261 million consumers every day.
Its operations cover certain territories in Mexico, Brazil, Guatemala, Colombia, Argentina, and, at the national level, in Costa Rica, Nicaragua, Panama, Uruguay and Venezuela through its investment in KOF Venezuela.
Family packaging also helps and Arca
For Arca, returnable packaging has been a part important in their strategy in Latin America for a long time since, in addition to offering affordability, it allows them to have a more flexible portfolio and provide different options for consumers.
“That has proven to be very effective, especially at times like these and in seeing how it works in most countries and it’s not just about launching the packaging, it’s about having the whole operation and culture within our operation to work with returnables. It requires a lot of variables and metrics and you need to track, have the infrastructure and the supply chain en route to the market adapted to that, ”said the company during its conference with analysts.
Mexico and Argentina are the countries where it takes the longest, approximately four years, implementing these packages, but they also seek to grow this culture in Ecuador. However, they recognize that you need to work hand in hand with the consumer to create the return habit.
For its part, the second largest Coca-Cola Company bottling company, said that returnable family presentations grew in a high digit during the second quarter of the year in Argentina.
“The recent launch of Aquarium-flavored water in a returnable two-liter presentation is a great example of innovation and agility to provide affordable products during a major contingency, “the company said at the conference with analysts.
In this region the volume of sales registered a reduction of 10.3%, mainly affected by the falls in the categories of flavors and waters of 38.5% and 24.0%, respectively, which were partially offset by a solid performance in returnable and family packaging in the glue category, the company noted in its financial report.
“What you are seeing a lot during this contingency is that they are buying more family presentations, such as jugs and large soft drinks, because they eat at home so those are one of the big trends”Said Jorge Senties, PwC consultant.
In the case of Arca Continental, the 3-liter family packaging helped the glues category, which grew 0.8% during the second quarter. But also the rest of its categories.
“Family packaging had an increase in the categories of mineral water, dairy and cola as a result of acquiring larger presentations, due to the state of voluntary isolation of families in the home, the preference for acquiring a larger product to reduce the need to go outside and as channels where there is a greater presence of packaging are closed personal, ”noted his reports.
Read: United States ‘saves’ Arca Continental and drives 2.3% its sales
Arca Continental noted that during this quarter they accelerated the introduction of multi-use returnable packages backed by their new universal bottle packaging that allows them to offer a wide variety of returnable products with a single bottle.
“During 2Q20, activities were taken to boost consumption, focusing efforts mainly on promoting personal packaging and the flavor category, as well as developing and creating greater availability of returnable packaging with the aim of protecting the affordability of our products ”, he stated in his financial report.
Arca Continental serves a population of more than 123 million in the northern and western regions of Mexico, as well as in Ecuador, Peru, in the northern region of Argentina and in the southwestern region of the United States.