The Coca-Cola Company is shaking things up, shifting to a more focused approach to innovation. This change comes as a response to its historically high failure rate in this area. John Murphy, the President and CFO of the company, discussed this new direction at the recent Redburn CEO Conference. He emphasized that for big consumer product groups (CPG) like Coca-Cola, staying on top of market trends is crucial and requires constant innovation.
Targeted Marketing and Refined Consumer Segmentation
Coca-Cola’s new strategy isn’t just about creating new products; it’s about understanding their customers better. They’re zooming in on consumer segmentation, realizing that customer needs can vary significantly even within short distances. For example, shoppers in rural Georgia have different preferences compared to those in Atlanta, despite the close proximity.
Combining Data with Consumer Behavior
The company is going a step further by marrying consumer data with behavioral analysis. This means not just knowing who their customers are, but understanding their habits and preferences. This approach helps Coca-Cola to invest more wisely, aiming to get the best returns.
Innovation in Bottling and Leadership
Coca-Cola’s bottling departments are also getting a boost in innovation. With new leadership focusing on market evolution, there’s a clear move towards modernizing this key area of the business.
Leveraging Data for Strategic Decisions
Data plays a big role in Coca-Cola’s new approach. By pooling information from market trends, their own research, and external sources, the company aims to turn insights into actionable strategies. This is part of a broader move towards a more advanced set of marketing capabilities, including keeping data secure, integrating tools effectively, and remaining agile in a fast-changing market.
Embracing Analytics in Retail
In today’s retail and consumer products world, understanding and using analytics is more important than ever. Coca-Cola recognizes the boundless potential of analytics to transform commerce, seeing it as a key driver for the future.
Streamlining for Efficiency and Innovation
Coca-Cola has significantly reduced its number of applications, now operating with around 700-800, which is below average for a company of its scale. This streamlined approach is designed to facilitate better decision-making and integration, enabling the company to be more agile in its digital strategy and investment decisions.
Raising the Bar for Innovation
Finally, Coca-Cola is raising its internal standards when it comes to innovation. They’re implementing stricter metrics to evaluate the performance of new products and ideas, ensuring that only the best make it through to the market. This renewed focus on discipline and efficiency marks a significant shift in how Coca-Cola approaches innovation and market strategy.
Source: Consumer Goods
