The U.S. Coca-Cola market just isn’t what it used to be — bottler Coca-Cola Enterprises’ profit fell 23% due to commodity costs and sluggish U.S. sales. The solution? Raise prices. You can expect battled Coke to cost a little more after labor day.
Coca-Cola Enterprises, which has about 80 percent of the United States market for Coke, said it would raise prices after Labor Day because of higher commodity costs and declining American soda sales. It said prices would go up by a percentage in the mid-single digit to high-single digit range. Bottlers set prices for retailers like grocery stores.
Hey, at least they didn’t change the bottle size, right?
Biggest Bottler of Coke Plans to Increase Prices [NYT]
(Photo: balmes. )
More From Consumerist
-
How Did A Coke Only Cost A Nickel For 70 Years? Because Coca-Cola Said So
-
Is The Real, Super Secret Coca-Cola Recipe For Sale On eBay?
-
Pepsi To Replace Coke In Costco’s Beloved $1.50 Soda & Hot Dog Deal
-
JCPenney Pinning Its Hopes On The Guy Responsible For Marketing New Coke
-
Coroner Concludes Woman’s 2 Gallon A Day Coca-Cola Habit “A Substantial Factor” In Her Death
another reason to not choke down high fructose corn syrup. I welcome the price raise.
Maybe that’ll motivate people to drink less soda. But some people’s gotta have their caffine fix right?
It’s already about $5/12pk cans. Raising prices 8% or so is nuts, considering in Michigan I also have to pay $1.20 in deposit. Solution? Either wait for the 4 for $10 deals (sometimes 5/$11), or keep drinking that high-quality H2O.
Sales (demand) are down the response is to raise prices. What?
I love coke. It’s the only cola I like. However lately I’ve been hittin up that rasberry citrus Mountain Dew. In fact I’m drinking one right now
@ScubaSteveKzoo: This is for bottled, er “battled” Coke, which is the only way to (locally, anyway) obtain Coke made with sugar instead of HFCS. Quick, to Costco, everyone! Stock up!
@zigziggityzoo: Not sure why you are throwing in the deposit amount in there, you get it back. Or are you actually too lazy to recycle the cans and lose the deposit?
@loganmo: It sounds like something a cigarette company might try [inelastic demand]…so does Coke think it’s product is that addictive? I’ve always thought it was fishy that I would suffer withdrawal symptoms after drinking Coke for too long…
This is insane. So poor sales = price raise? That doesn’t seem smart.
@zigziggityzoo: Most stores (like Target and Wal-Mart) alternate putting Pepsi and Coke products on sale each week so you can get three or four 12-packs for something like $11.00. I’ve also found that gas stations tend to provide good deals from time to time on 12-packs. You just have to watch out for the signs.
@Angryrider: I drink soda purely for the fiz, but if the price goes up I may have to look for an alternate. As of right now soda is so cheap, ten twelve packs for ten dollars, that there is no reason not to buy.
err… correction, five twelve packs for ten dollars
@Tmoney02: Not too lazy to recycle, but sometimes too lazy to return them to the store for deposit back. The recycling bin is 20 feet away. The store is 2 miles.
@snoop-blog: The new MD flavors are indeed surprisingly good.
@Captain_Collide: Not really, as others have mentioned, there is analogy in cigs. You will always have a die-hard group of consumers, so if you can extract more margin out of them, the overall reduced sales are nullified.
@dorianh49: I think they’re referring to “bottlers” in the generic sense, anyone who puts Coke in a container, not just the sugar version. Can anyone confirm.
@ScubaSteveKzoo: I’m with you. This might actually help people get off super-sweet drinks.
I drink obscene amounts of Coke Zero now, but I use to be a Pepsi girl. For some reason Pepsi is slightly more expensive in my area most of the time. If Coke raises it’s prices by that much I’ll probably just switch back to Pepsi.
They already reduced the 2L bottles to 1.5L bottles where I live a few years ago. Some stores have both but most just have the smaller size. Price didn’t go down, either.
Meh, the generic grocery store brand is way cheaper anyway. Why pay 75 cents for a can of Coke when I can get Safeway Cola for 25 cents?
My boyfriend recently bought me the most awesome thing, it’s called Soda Club. You can use it to make your own soda. You get a small device with a cannister of CO2 good for making about 120 liters of soda or so. There are over 30 flavors, ranging from cola to fake dr. pepper to energy drink to citrus sparkling water. It’s alot cheaper than store bought soda, and it’s fun!
Coca-Cola also recently removed the 12 pack gift certificates from the mycokerewards.com program.
It used to be that for every 100 points you could redeem them for a 12 pack of coke. With coworkers giving me their bottle caps I redeemd over 45 free 12 packs in the last 9 months.
Coke goes on sale every other week … anyone who pays retail is crazy … just watch the sales and stock up. I don’t think I have paid over 2.50 for a 12 pack of Coke in the last 3 years. Currently I have 4 12 packs in the pantry … its not like it goes bad quickly.
@zigziggityzoo: Understandable. If you have kids you can have them put it in the machine while you shop, or know neighbor kids, have them return the cans and split the money. Just a few ideas.
@EE: Give mineral water a shot. As I mentioned in a Lifehacker comment, Perrier broke the soda habit for me. If you’re absolutely dying for a sugar fix, try this stuff: (available at Costco)
[www.scojuice.com]
(It’s unbeLIEVAbly tasty!)
BTW, anyone else having problem with the nested comments script breaking with Firefox 3.1? (All the Better Lifehacker scripts, as a matter of fact…)
@EE: I had the same thing. I switched to club soda/seltzer water. Better for you, cheaper, and gives me the fizz. Some might view it as bland, but it works for me.
Because of “declining American soda sales” they’re going to raises prices? This makes no sense. The shelf price for a 12-pack of Coke is $5.49. I’m pretty sure Coke is making a small profit on their carmel-colored sugar water. Guess it’s time to stock up now before the price high. Bah!
where’s the “edit” button? “price hike” not “price high” bah!
@snoop-blog: Oh, snoop-blog, why haven’t I heard about this raspberry citrus Mountain Dew?! I mean, I’m glad the orange Live Wire is back but this flavor sounds good.
So either Pepsi will take this and price themselves lower than Coke, OR take the more likely solution, and raise their prices along with Coke.
I wonder if their promos that they had a kicking their ass – “Buy FOUR 12 packs, get another 12 pack FREE!”
Well crap… rum and coke is my husband’s weekend fix.
Seriously Coca-Cola… raising your prices when everyone is trying to save money is just going to make people buy less or buy something else.
@ObtuseGoose: @Captain_Collide: @loganmo:
I would assume they are raising prices because the “higher commodity costs” have risen to a point to severely hamper profits made. In the past they were able to shrug it off and make it up through volume but since everyone is stopping their pop habits they are being forced to raise prices to guarantee the profits. (and obviously raise it more than any lost volume due to the higher price)
Before July 4, the Safeway near me was having a “Buy 2, Get 3 free” for 12 packs of coke, which worked out to something like $1.75/12 pack. So that was obviously the opportune time to stock up. I don’t really buy coke any more, but I like seeing a good deal.
The key point is that this is the “bottler” not Coca-Cola the drink maker, they are 2 different companies. It is the same way with Pepsi. This is why if you are wanting to own a drink company you want to make sure you own the company that makes the drink not the bottler, the company that makes the product can screw the bottler to keep their stock looking good when it is really in the shit. It looks like they have been playing that game and now the bottler is having to raise prices to make a profit.
@loganmo: I think I’ve found what I want for my birthday! Now to start leaving hints around the house…
Note to everyone here who is mystified by Coke’s decision to raise prices: the alternative would have most likely been smaller sizes, i.e. the “grocery shrink ray.” Every time someone on a GSR post points out that reducing portion sizes is functionally equivalent in most ways to raising prices, about a million people respond that they’d prefer companies to be “honest” and just hike up prices.
Well, you got your wish!
@ObtuseGoose: The issue is not that they aren’t making a profit. The issue is that they aren’t making the same level of profit as they did before. Investors don’t take kindly to that sort of thing.
How is drinking less soda a bad thing? If prices go up and people drink less, maybe we’ll all be healthier? A price hikes affect kids much more than adults, and if kids drink less soda, that’s a good thing, no? Kinda like $5 gas – we’re all driving less.
@loganmo: Now that’s smart!
I’m not a big soda drinker, but when I do get a craving, Jones’ Strawberry Lime or FuFu Berry does the trick. They also sell a Pure Cane Sugar Cola.
[www.jonessoda.com]
@ratnerstar: The difference is that it’s honest and people notice.
If Pepsi and company don’t follow suit and keep prices the same, they’re in a good position to snipe some of Coke’s business. How badly do some people prefer Coke to Pepsi? Bad enough to pay the hike? I’d suspect most would, but obviosuly not everyone (if they haven’t already moved to generic store brands).
Now, if Coke raised prices by sipping a few ounces off the top of all their existing unit sizes, the hike wouldn’t be as obvious and they can trick people into not re-evaluate their spending.
You know – if it was that tasty mexican coke that Costco sells with the real sugar instead of that corn surup crap, I’d *GLADLY* pay a premium. As it is, domestic coke has not touched these lips in YEARS now.
I was all set to come in here and extol the virtues of the 4/$10 and 5/$11 sales, but I see 24896515 of you beat me to it. Walgreens and CVS tend to have really good soda discounts as well, and if you’re willing to jump through the hoops of their customer card programs you can save even more. Luckily there are varieties of just about every bottler’s products that I like (Coke Zero, Pepsi Max, diet Sunkist, diet Dr. Pepper, etc) so when each bottler puts their stuff on special, I stock up. If this means Coke costs more and goes on sale less frequently? Eh. Who cares. I’ll just buy the other brands instead.
I love fizzy mineral water too. La Croix, Canada Dry, or if I’m feeling fancy, Perrier. If I’m feeling REALLY fancy, Gerolsteiner. God I love that stuff. I wish we could get Gerolsteiner Medium in the US.
@Applekid: I’m inclined to agree with you; my point was, given the general consumerist mindset, people should be applauding Coke rather than shaking their heads.
@ratnerstar: Quoted, because this is my exact problem with shrinkage complaints. People aren’t satisfied even when it’s communicated clearly! The same thing happened when General Mills advertised that they were shrinking their cereal a year ago.
If Coke is having problems moving their product I’d suggest they move their prices down, not up, and ask their vendors to do the same. $3 for pop at a football game is too much, and $1.49 for pop at a gas station is borderline too much.
As far as I’m concerned, everybody who’s selling single-serving bottles of pop are pricing it like cellphone carriers price their SMS plans – like value add-ons that they know people will pay out the ass for regardless of how much it costs.
20oz bottles of coke for $1.49 at the gas station down the street from my office, while 2 liter bottles go for something stupid like $1.20. Really? At that price, those bottles should be sold out all the friggin time, right? Wrong – 2 liters is too damn much for somebody who just wants a drink for lunch, and besides those bottles don’t fit in the cupholder in my car anyway.
I’d buy a heck of a lot more pop if I could finish what I bought in one sitting and it meant my monthly pop bill wouldn’t outweigh my cellphone bill.
my wife and i are coke zero addicts, we usually go though approximately 20 two liters every month. i won’t pay more than $1 each, so we usually stock up a months worth when they
are on sale.. heck i have a rain check from Food Lion for 79 cent two liters if ever the price goes up too high…
I know someone who won’t be happy to hear this. My mom has a neighbor who really enjoys coming home from work and having a rum and Coke. When the price of rum went up, she railed that all she does is work and come home, and all she wants is to have her rum and coke in peace, and how could they not leave her only vice alone. Poor lady.
I refuse to buy regular Coke with HFCS and there is no way I’m pumping my or my kids body with those artificial sweeteners for the diet drinks. Hell raise the price all you want. It would be good for a change to stop people from drinking mass quantities of this crap. It’s sicking to see people letting their kids drink soft drinks and nothing else.
I’ll have Roz the moderator know I’m holding back as many “coke Prices” jokes as I can, but I keep thinkin about that Jay-z line “coke prices up and down like it’s wall street holmes…”
@evslin: Sounds like you have a problem with vendors/merchants not coke itself. They can only set the price that they sell to the vendor. The vendor can then charge whatever they want. It is in vendors best interest to sell as much pop as possible so whatever they are charging is what they think people will pay and why would coke tell the vendor they know better than the vendor.
$3 for pop at a football game is too much, and $1.49 for pop at a gas station is borderline too much.
What no complaint about the price of pop at the movie theater? Maybe you should accept venues charge inflated prices because they can and they have to pay off stadium expenses. And There is a reason most people don’t shop at their local gas station. You are paying more for the convenience of not having to go to a grocery store.
like value add-ons that they know people will pay out the ass for regardless of how much it costs.
Whats wrong with that? Nobody is forcing people to buy soda, there is plenty of other options available at different prices, so if people are willing to pay whatever the cost whats wrong with charging that?
20oz bottles of coke for $1.49 at the gas station down the street from my office, while 2 liter bottles go for something stupid like $1.20.
You ever thought that maybe the costs of a 2 liter is a lot less than a 20oz. The plastic and shipping costs per ounce of pop is a lot more for a 20oz. Plus you are paying for the convenience of a smaller package. Almost everything is cheaper in bulk.
@iMe2: You’re probably going through withdrawal from the caffeine. It could just as easily happen with Mountain Dew or coffee.
I’m seriously surprised they didn’t decide to invent new sizes like the 10-oz. can, the 18-ounce bottle, and the 1.6L bottle.
Or maybe a 9-pack of sodas instead of 12. Market it as “The soda cube” arranging the cans in a 3×3 square.
Maybe sales are sluggish because you see a 16 ounce bottle at the register for 10 cents less than you could buy a liter in the aisle.
Screw these poison purveyors.