/ 20 February 2014

Social media takes the sweet fizz out of Coca-Cola sales

Nampak is South Africa's largest packaging company.
Nampak is South Africa's largest packaging company.

Hailed by Interbrand as the globe's most valuable brand for 13 years in a row, ​the maker of Coke and Appletizer was dethroned for the first time last year, and its sales ­volumes suffered too.

A global slowdown in the purchase of soft drinks has been the catalyst. According to data published by Nielsen and analysed by Wells Fargo, sales of regular soft drinks dropped by 2% last year and diet soft drinks by a dramatic 7%.

It's thanks to a barrage of new research exposing the evils of sugar, and public campaigns to curb the drinking of soft drinks.

Last quarter Coca-Cola increased global sales volumes by only 1%, which was 2% less than a year ago. Shares on Tuesday took their biggest one-day knock since August 2011.

Zipporah Maubane, head of communications for Coca-Cola Southern Africa, said the company does not give breakdowns of revenues by geographic area. But a company-issued graph shows that per capita consumption of all Coca-Cola products in South Africa increased from 176 in 2001 to 247 in 2011.

Slowing sales
Yet according to Bloomberg, the company's sales are slowing in the "developing markets" category (to which South Africa belongs), and which makes up 37% of its sales.

Coca-Cola's latest advertising offensive, inviting people to "share a Coke" with friends and family, may be proof of an attempt to maintain growth.

Many people believe social media is powering the beverage slowdown. A quick search on Twitter shows how the "evils of sugar" have been popularised by the likes of local sugar-basher @ProfTimNoakes, who has 34 500 followers on Twitter.

"Once you tip over the precipice, you're gone," exercise science professor Noakes told Men's Health magazine.

"You are going to die of diabetes. And if you want that, keep eating sugars and carbohydrates, and get fat. That's where you are going."