Using the soft drink price tracker to explore price dynamics: Spotlight on Coca-Cola in Brazil

Last month, Euromonitor International launched its latest dashboard: the Soft Drink Price Tracker. With unit price inflation always being a major concern for suppliers and retailers in the global beverage industry, the Price Tracker dashboard allows subscribers to monitor product price movements, as well as pricing strategies for assortments and pack sizes across the online channel’s categories and brands. This data can be used to:

  • Compare relative price changes over time across categories and markets
  • See which brands are driving price movement in a category
  • Explore each brand to see price changes on available pack types, identifying how brand owners are adjusting their pack mix.

The Price Tracker uses SKU data from Via, Euromonitor’s price and product attribute database. Daily price, composition and availability data is pulled from over 2,000 online retailers.

Case Study: Understanding Coca-Cola’s Tariff Action in Brazil

For example, the Price Tracker can be used to take a closer look at the impact of inflation on the world’s largest soft drink company, Coca-Cola, in one of its most important long-term markets. – Brasil.

Coca-Cola FEMSA is the largest independent bottler of Coca-Cola products in the world and the largest of several local bottling partners in Brazil. Within FEMSA’s South America operating division (of which Brazil is the largest single market), FEMSA reported a 25.9% increase in the average price per unit case for the first six months of 2022. This measure represents revenue earned by the company from the sale of packaged beverages and beverage concentrates to retail customers of the regional operating unit.

But what does this mean for consumers and the retail price? Using a representative sample of online SKUs from the Soft Drinks Price Tracker, we can determine that a substantial increase in the wholesale price per case of FEMSA does indeed correspond to comparable increases in the SKU price through the online channel, with increases observed in 2022 YTD for two major brands of Coca-Cola carbonates:

Source: Soft Drinks Price Tracker, prices from January to June 2022 for the two main brands of Coca-Cola in Brazil

From January 2021 to June 2022, we estimate that the unit price per liter of the Coca-Cola brand of carbonates increased by 24.0% on a representative basket of online SKUs, with a first peak in June 2021, before increase again in the first six months of the calendar year. A similar trend was seen for the company’s number two brand in the Brazilian carbonates category, Fanta, with a price increase of 20.6% between January 2021 and June 2022.

Balancing price increases in the smaller “immediate consumption” packaging type has been a key part of the company’s pricing strategy in Brazil over the past year. For example, the 1x220ml packaging type for Fanta increased the price per 100ml by 23% over the period January 2021 to June 2022, while the same packaging type for Coca-Cola increased by 22% – among the highest price increases observed for the brand within the Price Tracker sample.

Example: Observed price increases of 220 ml SKU, January 2022-July 2022, at three major retailers in Brazil

Coca-Cola Price TrackerSource: Euromonitor International via pricing module

Raise prices but maintain affordability through the combination of packages

The 220ml “mini-can” type of packaging, first introduced in Brazil in 2017, has proven to be an important way to increase profitability and promote portion control options to consumers on many Coca-Cola markets, including North America and Western Europe. A wide range of packaging types and sizes gives the company flexibility in managing revenue growth for major brands: respond to rising input costs by increasing prices per SKU as needed, while preserving affordability per trade by adjusting the mix to focus on smaller sized options.

A closer look at the company’s transactional single-serve packaging options for Coca-Cola illustrates how a combination of changing size range and pricing strategy is reflected across major online retailers.

Non-Alcoholic Beverage Price Tracker: Coca-Cola Instant Drink Pack Types (Single), 1 x 200-600ml

Soft Drink Price Tracker

Source: Euromonitor International Soft Drink Price Tracker

The 310ml slim can emerges as a popular innovation format for the Coca-Cola brand

While all package sizes in the single-serving segment increased in price compared to January last year, the largest price increases were in the 220ml “mini-can” package type. (+21.8% since January 2021) and the new 310ml slim can (+21.0% since January 2021). In particular, the sleek 310ml can – now favored in many markets for new flavors and product development – has grown from just 5.9% of the single pulse mix in the online sample to more than 15% in June 2022, highlighting the importance of the type of packaging for Coca-Cola’s strategy in the Brazilian market.

Soft Drink Price Tracker

Source: Euromonitor International Soft Drink Price Tracker

Most recently, a new 310ml launch was introduced to the Brazilian market in July 2022, the latest limited edition launch from Coca-Cola Creations’ marketing initiative: DJ Marshmello’s Limited Edition (a strawberry and watermelon flavor) .

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Source: Coca-Cola Brazil Instagram

For further Euromonitor inflation analysis click here, or for more information on soft drink price monitoring, or via, please contact your local account representative.

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