6 ms·

If you check Coke's financial statements, you'll see that although revenue has risen quickly, cost of revenue has risen about as fast, leading to relatively unc

If you check Coke's financial statements, you'll see that although revenue has risen quickly, cost of revenue has risen about as fast, leading to relatively unchanged gross profit margins (36% so far in 2022, compared with 40%+ in every year from 1985-2014 and between 33%-39% from 2015 to 2021). Word from industry press is that the rising price of aluminum has been a major driver of the increased costs. I don't know why pricing for the generic brands wouldn't increase as much. Perhaps some stores see the large price increase in branded soft drinks as an opportunity to get people to shift to the store brands and are willing to tolerate lower profit margins to see if that strategy pays off.

danuker 4y ago
Store brands have very little advertising costs, for one. Coke spent $4B on advertising in 2021 [0], which is about a quarter of their costs. [1] [0] - https://statstic.com/coca-cola-advertising-costs/ https://statstic.com/coca-cola-advertising-costs/ [1] - https://www.macrotrends.net/stocks/charts/KO/cocacola/cost-goods-sold https://www.macrotrends.net/stocks/charts/KO/cocacola/cost-g...
- eatsyourtacos 4y ago
  I guess I must be wrong, but I'll never understand why Coke needs that much advertising. Or anything "that well known". The argument is maybe they are that well known because of advertising, but I just don't think that's the case. Maybe for a crappy product, but not a good product. With Coke it's the quality (and consistency) of the product. I've never tasted anything "as good" as Coke. A new fresh cold can has a bite that simply nothing else has. 4 billion a year on advertising something everyone knows about...
  - RC_ITR 4y ago
    Coke’s advertising isn’t “hey this is what Coke is” it’s “hey aren’t you thirsty and don’t you remember how much fun you’ve had in the past while drinking Coke?”
    - eatsyourtacos 4y ago
      I've never once grabbed a coke because of seeing a commercial. And I barely drink it because I have enough sugar in my life and don't want my kids chugging soda all day long like I did as a kid. So I do see your point, I just don't get how that influences people. But again, I recognize it must to enough of a degree- I just don't feel like I'm one of them so it's hard to personally understand. Maybe I am, but I think I'm being objective about it.
      - prepend 4y ago
        The only reason you’ve ever drank a coke is because of these ads. Do you think you’re immune to ads? Or that ads don’t work at all? I think it’s reasonable that you’ve never seen an ad and consciously bought a coke, but that’s rarely the point of coke. We’re not aware of all our subconscious motivations. I’d like to be, but it’s usually pretty hard for me to understand why I do things at a deep level.
        tekknik 4y ago
        > The only reason you’ve ever drank a coke is because of these ads. This isn’t true in all cases. When I first drank a coke I was very young and wasn’t even aware of advertising. The first coke I drank was because my parents took me to McDonalds and that’s all they sell. Then I found I preferred it over Pepsi. Advertising had very little to do with my first coke, it was more contracts with fast food companies.
        RC_ITR 4y ago
        > it was more contracts with fast food companies. Also known as 'advertising.' (Coke has an insane amount of control over how their products are sold at McDonalds, down to how the soda fountain equipment can look) Why do you think PepsiCo Bought KFC/Pizza Hut/Taco Bell (before spinning them back out as Yum!)? Coke spends money so that every time you are thirsty you reach for a Coke, and part of that is the immense amount of work they do to make Coke the only beverage available in places like McDonalds, AMC, United Airlines flights, etc.
  - llbeansandrice 4y ago
    This comment sounds like you're getting a piece of that $4bn
    - eatsyourtacos 4y ago
      Not sure what that is supposed to mean. I'm pointing out that it's a high quality product. There's a reason Coke absolutely dominates everything else out there. I guess to you I'm just a Coke shill though. Ok!
      - shawabawa3 4y ago
        He means the reason you think it's a high quality product is that the $4B of advertising has had an affect on you subconsciously
        TillE 4y ago
        Which is a pretty silly claim. There are great colas with far less advertisement, but they're small premium brands which cost the same or more. Store brands are typically awful, Pepsi is bad despite their advertisement budget.
  - Aunche 4y ago
    In blind taste tests, Coke performs about as well as Pepsi. However, people still overwhelmingly seem to like Coke, so it's really because they like the brand. If they reduced advertising, their brand will slowly be eroded.
    - peteradio 4y ago
      Blind tests sponsored by whom?
      - mensetmanusman 4y ago
        Blind sponsors
    - cglace 4y ago
      I interviewed a guy who worked at Pepsi. He said their own tests actually showed that people enjoyed Pepsi for the first sip but then preferred coke when drinking more.
      - harambae 4y ago
        Pretty sure that's because Pepsi is sweeter (the regular non-diet version). The sweetness is initially preferable, so it tends to win out in the "Pepsi Challenge" but then is overwhelming when you're drinking the whole thing.
    - phpisthebest 4y ago
      I dont know if I am alone but for me I prefer Bottled Pepsi over Bottle Coke, but Fountain Coke over Fountain Pepsi I also prefer Mt. Dew over them all so....
    - excitom 4y ago
      Remember "New Coke"? The Coca Cola people responded to taste tests that indicated people like Pepsi better by making it more sweet like Pepsi. Sales and PR disaster ensued, famous case study in MBA courses. https://en.wikipedia.org/wiki/New_Coke https://en.wikipedia.org/wiki/New_Coke
  - aeyes 4y ago
    Coke is only one of their products, they probably need some advertising to promote their other 200 brands: https://www.coca-colacompany.com/brands https://www.coca-colacompany.com/brands
hhjinks 4y ago
Generic brands often don't come in aluminum cans, assuming the industry rumours are true.
- prepend 4y ago
  I’ve shopped in the US for a few decades. The store brand soda has always come in aluminum cans (in addition to all the other forms of packaging coke uses). Also, prices for coke in plastic bottles are also up.
- cglace 4y ago
  Care to elaborate?
  - staticfish 4y ago
    I'm guessing parent resides from the UK or Europe. Mostly "own brands" here come in 2 litre bottles
    - lzooz 4y ago
      In my European country all own brands are available in cans.
- vel0city 4y ago
  In the US it is usually easy to find generic brand sodas in cans. Most large-ish grocery stores have them. https://www.tomthumb.com/shop/product-details.208010001.html https://www.tomthumb.com/shop/product-details.208010001.html https://www.kroger.com/p/big-k-cola-soda/0001111049680 https://www.kroger.com/p/big-k-cola-soda/0001111049680? https://www.publix.com/pd/publix-cola/RIO-PCI-106059 https://www.publix.com/pd/publix-cola/RIO-PCI-106059 https://www.walmart.com/ip/Sam-s-Cola-Soda-Pop-12-fl-oz-24-Pack-Cans/16504562 https://www.walmart.com/ip/Sam-s-Cola-Soda-Pop-12-fl-oz-24-P... https://www.heb.com/product-detail/h-e-b-original-cola-7-5-oz-cans-6-pk/2222954 https://www.heb.com/product-detail/h-e-b-original-cola-7-5-o...
iamgopal 4y ago
Increase diameter couple of mm and reduce height couple of mm, will that work ?

danuker 4y ago

Store brands have very little advertising costs, for one. Coke spent $4B on advertising in 2021 [0], which is about a quarter of their costs. [1] [0] - https://statstic.com/coca-cola-advertising-costs/ https://statstic.com/coca-cola-advertising-costs/ [1] - https://www.macrotrends.net/stocks/charts/KO/cocacola/cost-goods-sold https://www.macrotrends.net/stocks/charts/KO/cocacola/cost-g...

eatsyourtacos 4y ago
I guess I must be wrong, but I'll never understand why Coke needs that much advertising. Or anything "that well known". The argument is maybe they are that well known because of advertising, but I just don't think that's the case. Maybe for a crappy product, but not a good product. With Coke it's the quality (and consistency) of the product. I've never tasted anything "as good" as Coke. A new fresh cold can has a bite that simply nothing else has. 4 billion a year on advertising something everyone knows about...
- RC_ITR 4y ago
  Coke’s advertising isn’t “hey this is what Coke is” it’s “hey aren’t you thirsty and don’t you remember how much fun you’ve had in the past while drinking Coke?”
  - eatsyourtacos 4y ago
    I've never once grabbed a coke because of seeing a commercial. And I barely drink it because I have enough sugar in my life and don't want my kids chugging soda all day long like I did as a kid. So I do see your point, I just don't get how that influences people. But again, I recognize it must to enough of a degree- I just don't feel like I'm one of them so it's hard to personally understand. Maybe I am, but I think I'm being objective about it.
    - prepend 4y ago
      The only reason you’ve ever drank a coke is because of these ads. Do you think you’re immune to ads? Or that ads don’t work at all? I think it’s reasonable that you’ve never seen an ad and consciously bought a coke, but that’s rarely the point of coke. We’re not aware of all our subconscious motivations. I’d like to be, but it’s usually pretty hard for me to understand why I do things at a deep level.
      - tekknik 4y ago
        > The only reason you’ve ever drank a coke is because of these ads. This isn’t true in all cases. When I first drank a coke I was very young and wasn’t even aware of advertising. The first coke I drank was because my parents took me to McDonalds and that’s all they sell. Then I found I preferred it over Pepsi. Advertising had very little to do with my first coke, it was more contracts with fast food companies.
        RC_ITR 4y ago
        > it was more contracts with fast food companies. Also known as 'advertising.' (Coke has an insane amount of control over how their products are sold at McDonalds, down to how the soda fountain equipment can look) Why do you think PepsiCo Bought KFC/Pizza Hut/Taco Bell (before spinning them back out as Yum!)? Coke spends money so that every time you are thirsty you reach for a Coke, and part of that is the immense amount of work they do to make Coke the only beverage available in places like McDonalds, AMC, United Airlines flights, etc.
- llbeansandrice 4y ago
  This comment sounds like you're getting a piece of that $4bn
  - eatsyourtacos 4y ago
    Not sure what that is supposed to mean. I'm pointing out that it's a high quality product. There's a reason Coke absolutely dominates everything else out there. I guess to you I'm just a Coke shill though. Ok!
    - shawabawa3 4y ago
      He means the reason you think it's a high quality product is that the $4B of advertising has had an affect on you subconsciously
      - TillE 4y ago
        Which is a pretty silly claim. There are great colas with far less advertisement, but they're small premium brands which cost the same or more. Store brands are typically awful, Pepsi is bad despite their advertisement budget.
- Aunche 4y ago
  In blind taste tests, Coke performs about as well as Pepsi. However, people still overwhelmingly seem to like Coke, so it's really because they like the brand. If they reduced advertising, their brand will slowly be eroded.
  - peteradio 4y ago
    Blind tests sponsored by whom?
    - mensetmanusman 4y ago
      Blind sponsors
  - cglace 4y ago
    I interviewed a guy who worked at Pepsi. He said their own tests actually showed that people enjoyed Pepsi for the first sip but then preferred coke when drinking more.
    - harambae 4y ago
      Pretty sure that's because Pepsi is sweeter (the regular non-diet version). The sweetness is initially preferable, so it tends to win out in the "Pepsi Challenge" but then is overwhelming when you're drinking the whole thing.
  - phpisthebest 4y ago
    I dont know if I am alone but for me I prefer Bottled Pepsi over Bottle Coke, but Fountain Coke over Fountain Pepsi I also prefer Mt. Dew over them all so....
  - excitom 4y ago
    Remember "New Coke"? The Coca Cola people responded to taste tests that indicated people like Pepsi better by making it more sweet like Pepsi. Sales and PR disaster ensued, famous case study in MBA courses. https://en.wikipedia.org/wiki/New_Coke https://en.wikipedia.org/wiki/New_Coke
- aeyes 4y ago
  Coke is only one of their products, they probably need some advertising to promote their other 200 brands: https://www.coca-colacompany.com/brands https://www.coca-colacompany.com/brands

hhjinks 4y ago

Generic brands often don't come in aluminum cans, assuming the industry rumours are true.

prepend 4y ago
I’ve shopped in the US for a few decades. The store brand soda has always come in aluminum cans (in addition to all the other forms of packaging coke uses). Also, prices for coke in plastic bottles are also up.
cglace 4y ago
Care to elaborate?
- staticfish 4y ago
  I'm guessing parent resides from the UK or Europe. Mostly "own brands" here come in 2 litre bottles
  - lzooz 4y ago
    In my European country all own brands are available in cans.
vel0city 4y ago
In the US it is usually easy to find generic brand sodas in cans. Most large-ish grocery stores have them. https://www.tomthumb.com/shop/product-details.208010001.html https://www.tomthumb.com/shop/product-details.208010001.html https://www.kroger.com/p/big-k-cola-soda/0001111049680 https://www.kroger.com/p/big-k-cola-soda/0001111049680? https://www.publix.com/pd/publix-cola/RIO-PCI-106059 https://www.publix.com/pd/publix-cola/RIO-PCI-106059 https://www.walmart.com/ip/Sam-s-Cola-Soda-Pop-12-fl-oz-24-Pack-Cans/16504562 https://www.walmart.com/ip/Sam-s-Cola-Soda-Pop-12-fl-oz-24-P... https://www.heb.com/product-detail/h-e-b-original-cola-7-5-oz-cans-6-pk/2222954 https://www.heb.com/product-detail/h-e-b-original-cola-7-5-o...

iamgopal 4y ago

Increase diameter couple of mm and reduce height couple of mm, will that work ?