Coca-Cola to Debut RTD Cocktail With Bacardi: Will it Aid the Stock?
The Coca-Cola Company’s KO strategy of becoming a total beverage company is quite on track. In the latest revelation, KO, along with Bacardi Limited, has agreed to debut BACARDI rum and Coca-Cola as a ready-to-drink (RTD) cocktail, featuring the two most renowned global trademarks.
Some of Coca-Cola’s spirit-based RTD launches include Topo Chico Hard Seltzer, Simply Spiked Lemonade, FRESCA Mixed cocktails and Jack & Coke cocktail.
Latest Cocktail to Benefit KO
The scheduled initial launch will be in select European markets and Mexico next year. This premixed cocktail will be sold in various markets across the globe. This collaboration resonates well with the company’s strategy of developing into a total beverage firm, along with growing the alcohol ready-to-drink category.
Cocktail cans will contain responsibility symbols indicating the legal drinking age. BACARDI mixed with Coca-Cola RTD will follow the marketing practices of both companies.
RTD cocktails are quite popular among consumers in the United States. A few premix cocktails grabbing the limelight are margaritas, mojitos and manhattans. Coca-Cola is aggressively diversifying its portfolio to tap into the rapidly growing RTD alcohol beverage category. It has innovated its offerings in sync with the evolving consumer preferences for healthier beverage alternatives.
The aforesaid cocktail debut of Coca-Cola and Bacardi is not the first collaboration between the brands. Most recognized globally, the Cuba Libre cocktail, invented in 1900 in Havana, includes BACARDI rum, Coca-Cola and lime. This is the two brands’ most popular cocktail, the demand for which is still growing.
Coca-Cola’s Other Notable Efforts
KO’s digital initiatives position it well for growth ahead. The company is accelerating investments to build strong digital capabilities, hence evolving into an organization that efficiently executes marketing, commercial, sales and distribution, both offline and online. It is strengthening consumer connections and piloting numerous digital-enabled initiatives through fulfillment methods to capture online demand for at-home consumption.
The company is progressing well with the rollout of multi-category eB2B platforms with its bottlers globally. Coca-Cola and its bottling partners have been investing to digitize their customer base by integrating fragmented trade customers into B2B platforms. It has been leveraging its leading brands, like Topo Chico, while expanding its existing portfolio of Schweppes premium adult cocktail mixers and tonics.
KO’s Performance
The company has been seeing positive business trends in recent quarters, driven by robust revenue growth across most of its operating segments on higher price/mix. These positive trends were evident in Coca-Cola's second-quarter 2024 results. The performance marked the sixth consecutive quarter of surpassing top-and-bottom-line expectations.
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KO’s strong top-line performance was fueled by revenue growth across most segments, with organic revenues increasing 15% year over year. In the second quarter, Coca-Cola gained a global value share in the total non-alcoholic RTD beverage category.
Shares of this beverage giant have gained 15.4% in the past three months compared with the industry’s 9.8% growth. The launch of BACARDI rum and Coca-Cola RTD in 2025 will capture extra sales for this Zacks Rank #2 (Buy) company. This will boost its share in this category and increase overall profitability.
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CocaCola Company (The) (KO) : Free Stock Analysis Report
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