Coke Benefits From Higher Prices in North America

via ABCNews

Coca-Cola reported a better-than-expected profit Tuesday as it stepped up marketing and fetched higher prices for sodas in North America.

The world's biggest beverage maker has been struggling to boost global sales volume amid economic volatility overseas and an ongoing shift away from soda back at home.

To make up for weak volume gains, it's using a variety of tactics including a focus on "mini-cans" and smaller bottles in the U.S. that are positioned as premium offerings and help push up revenue.

For the quarter, Coca-Cola's overall soda volume in North America was flat, while volume for non-carbonated drinks rose 3 percent. Its "price/mix" for the region, which factors in the prices and sizes of its drinks, rose 4 percent.

"A lot of it was driven by the smaller cans, which are more premium-priced," said Kathy Waller, Coca-Cola's chief financial officer, in a phone interview.

Sales of the mini-cans alone, which still represent a tiny fraction of overall volume, rose 15 percent during the quarter, the company said. Coca-Cola is also significantly increasing marketing, including a double-digit percentage boost in media spending.

During a conference call, CEO Muhtar Kent said 2015 would be a "transitional year" as the company undergoes dramatic cost-cutting to improve results. But he nevertheless expressed optimism for growth; he noted that the average household consumes 26 beverages a day, and that only 1.4 of those are Coca-Cola brands.

To keep pace with changing tastes, Coca-Cola has also diversified and owns an array of brands including Honest Tea and Zico coconut water that better fit with prevailing health trends. It also recently began the national rollout of Fairlife, a pricier milk that promises more protein and less sugar.

Still, about 70 percent of Coca-Cola's global sales volume comes from carbonated soft drinks, according to Ali Dibadj, a Bernstein analyst.

For 2014, Coca-Cola said volume rose 2 percent, including a 1 percent boost in carbonated soft drinks. That was in line with its performance the previous year, and down from 2012.

The shift away from soft drinks in the U.S. comes amid a proliferation of options in the beverage aisle. Between 2001 and 2006, an internal study by Coca-Cola found that 30 percent of the industry's growth was driven by categories that hadn't existed five years earlier.

Soda's image has also taken a beating from health advocates at home and overseas, who blame it for fueling weight gain. In Mexico, Coca-Cola said overall volume declined by 1 percent for the quarter, although it did not specify how much soda volume fell. Performance in the country has been hurt by a tax on sugary drinks that went into effect last year.

Coca-Cola is also working on reducing costs by $3 billion a year to boost its financial results and have more money for marketing. Earlier this year, it said it was cutting up to 1,800 jobs as part of the push.

For the period ended Dec. 31, Coca-Cola Co. said it earned $770 million, or 17 cents per share. Excluding one-time items such as unfavorable currency exchange rates and expenses related to its cost-cutting plan, it earned 44 cents per share. That topped the 42 cents per share analysts expected, according to Zacks Investment Research.

A year ago, it earned $1.71 billion, or 38 cents per share.

Total revenue slipped to $10.87 billion, but beat Wall Street expectations of $10.77 billion.

Shares of Coca-Cola rose 3 percent to $42.54.

Tiesto Wins First Grammy For Best Remixed Recording

via YourEDM

 

 The day has finally come and the Grammys are already off to a great start. With Deadmau5, Tiesto, Zhu, Aphex Twin and several others all up for a Grammy, the day promises to be filled with several victories for the electronic music scene. To kick it off, Tiesto has already won his first ever Grammy ever for his remix of John Legends ‘All Of Me‘.

Tiesto released his remix to ‘All Of Me‘ on his birthday as a gift to fans but now, that track has brought Tiesto a new career milestone as he joins the ranks of Grammy winning artists.

Having over 4 million plays on Youtube, All of Me (Tiësto’s Birthday Treatment Mix) is a well balanced vocal driven track that even got the tip-of-the-hat from John Legend himself. Tiesto is the first EDM artist to win an award at today’s Grammys but with several more nominations in the pipeline, you can expect to see several more winners.

Pepsi To Debut Music Platform During Grammys

via MediaPost

Pepsi will unveil a sweeps-driven music platform called "Out of the Blue" during the Grammy Awards broadcast on Feb. 8.

The brand, a longtime sponsor of the awards, will air multiple ads promoting the new program during the broadcast, including at least two featuring previous Grammy nominee Fall Out Boy (shown) and current Grammy nominee Charli XCX.

For Out of the Blue, from Feb. 8 through May 18, Pepsi will each day give away one "flyaway" trip package to an upcoming music event — two mentioned are SXSW and the 2016 Grammy Awards — for a winner and three guests. The trips will include VIP perks such as backstage passes, premier seats, artist meet-and-greets, and access to rehearsals and sound checks. 

Fans can earn chances to win by following @Pepsi on Twitter and snapping and posting a photo of any Pepsi beverage product to Twitter with #OutoftheBlue.  

Entering the sweeps will also enable fans to access exclusive behind-the-scenes videos from artists and music events. New ones will be posted weekly on an Out of the Blue site hosted on Pepsico.com.

Pepsi said that it will also release several videos on Grammys night that highlight the careers of nominees, including HAIM, Bastille, Eric Church, Brandy Clark and Sam Smith.

The brand has also recruited Grammy nominee Jhene Aiko as a "correspondent" for the new platrom. Aiko will do artist interviews and cover behind-the-scenes shoots and events, appear at Out of the Blue events, and promote the platform on Pepsi's social media channels.

In announcing the platform's launch, Eric Fuller, director of Pepsi marketing, said that it's designed to "amplify" Pepsi's long marketing association with music and music experiences, which tie in closely with Pepsi's "Live for Now" brand theme.

"Underground" is the New EDM Buzzword

via VICE

Ultra Music Festival in Miami

Last week, Ultra Music Festival announced that when it brings the rave back to Miami’s Bayfront Park this March, it will also debut a new addition: a stage entirely devoted to "underground" dance music. This oasis of record store clerk-approved DJs will be called the Resistance stage, presumably in reference to Detroit’s politically-charged techno collective Underground Resistance. The debut lineup will feature mostly European and tech-house-leaning mainstays like Maceo Plex, Dixon, tINI, and Umek. In a statement, the festival explained the Resistance stage's formation like this: 
"It’s the urge to go against the grain, to step out of the box, to move away from the norm and challenge yourself to experience something new—to break down boundaries and barriers and abandon your comfort zone—to be able to open your eyes and ears to an undiscovered realm of electronic music."


"Undiscovered" might be a relative term. More than half of the artists on Resistance have already played at the festival before. Out of the 25 DJs who will grace the Resistance stage this year, 15 of them are Ultra veterans—including Maceo Plex, Sasha, Tale of Us, tINI, Joris Voorn, Jamie Jones, The Martinez Brothers, and Art Department. Sasha even headlined Ultra's second stage with Digweed in 2001. From Chus & Ceballos and Pete Tong to Martin Buttrich and Totally Enormous Extinct Dinosaurs, this stage is stacked more with the familiar than the new. If the Resistance stage was a Christmas present, this lineup would be a bit of a re-gift.  

Still, for those who only come to Ultra for the Tiësto and Guetta types, the sounds of these techno stalwarts is something to be discovered. Even though Ultra has hosted the Carl Cox & Friends stage for years as an alternative to the mainstage sounds across the festival grounds, so-called underground stages are popping up at almost every big, commercial dance festival across the country. Since its inception, Electric Zoo in New York City has had a Sunday School tent, named for the now-legendary Sunday School for Degenerates parties Made Event threw in mid-00s Miami in late March. Last year, they added a vinyl-only stage after premiering the concept at Mysteryland's New York debut. Both events took the vinyl concept literally, with a stage decorated with hundreds of records. Just last week, SFX sister festival Tomorrowland announced that the celebrated German DJ Sven Väth will curate an all-vinyl stage for its flagship event in Belgium this summer. 
Photo by Andrew Rauner

The rise of these alternative stages demonstrate how "underground" and "vinyl" have become the latest buzzwords in the commercial dance music world. Spurred by a growing backlash against generic EDM, ranks of DJs and dance music fans have grown tired of generic build-ups, drops, overwrought toplines, and heart-hands-in-the-air moments and now want something different. The formula of the EDM sound has long-since reached parodic levels, with Saturday Night Live spoofing Avicii with its "When Will The Bass Drop?" sketch, and MAKJ literally taking the piss with a banger by sampling his own toilet sounds. Even mainstage mainstays like Tiësto and Martin Solveig have backed off from the concept of EDM.

In some ways, the popularity of underground stages at dance festivals is an acknowledgement that the big sounds that brought dance music to American radio and EDM to marketing gurus the world over is no longer fashionable. These stages also solve the problem of how less mainstream but still immensely credible artists like Dixon and Tales of Us are able to fit into festivals with Hardwell and Steve Aoki on the mainstage while appeasing the growing group of dance music fans who have a yen for fresher sounds. Behind the scenes, agents have resisted having their "cooler" acts sharing the bill with commercial EDM DJs. Now, they'll be in a special section instead. Even as Ultra announced that it will be 18-and-over for the first time this year, its audience still skews young. The Resistance stage will expose these younger ravers to artists they're not yet old enough to see in a club setting. While Resistance and the like may be mere marketing ploys, the benefits of this new addition to festival culture lie in the future audience of techno. 

In truth, this trend is part of an age-old cycle wherein counter cultures are embraced as an alternative to mainstream options and then buoyed into greater popularity. Hip-hop, alternative rock, new wave, punk, disco and even EDM itself were all once part of an underground of their own, far from radio, Billboard charts and Grammy categories. Embraced for being different from the dominant sounds of a time, they eventually became the dominant sounds of their time. There's nothing inherently wrong with this progression; protesting it usually makes you sound like a grouchy old snob. It's important that fans know the difference between something that is truly underground and something that is just marketed to look like it is.  

As Ultra is still a super commercial festival with a ticket price that would prevent many people from attending, (three day passes are $450 now, as $300 and $380 passes have sold out), one could argue that the underground dance scene is one that operates outside of this kind of economy. No matter how many credible, underground artists Ultra, Electric Zoo, Tomorrowland, or others book, as long as these festivals charge stratospheric ticket prices, they can never really replicate the underground experience fans and artists seek as an alternative to mainstream festival culture. After all, the objective of these events (and their publicly-traded owners) is to make money. 
It is perhaps the underground's indifference to profit-based motives that is its best protection against dilution by popularity. That might be the greatest resistance of all.

Pepsi Abducts the Super Bowl Spotlight With Alien-Inspired Ad Introducing Its Halftime Show - Campaign tallied 54 million views before game even began

via AdWeek

Pepsi's lead-in ad for the Super Bowl's halftime show has an alien abduction theme.

While most brands began activating their Super Bowl campaigns over the past month, Pepsi's Hyped for Halftime plans began last Thanksgiving.

Using the #halftime hashtag, the brand curated conversations around its show with more than 40 pieces of digital content. And, right before Katy Perry's performance, the campaign will culminate in an alien abduction-themed 30-second spot (which was created by agency Mekanism) airing right before the show and paying homage to the supernatural lore of the Southwest.

"For Pepsi, it's really about owning the halftime conversation for months ahead of the 12-minute performance at the Pepsi Super Bowl Halftime Show," said Linda Lagos, digital director for Pepsi.

So far, the 2015 content has garnered more than 54 million views and 1 billion media impressions, Pepsi reports. Eighty-three percent of conversations around #halftime online have been related to its show so far this year, compared to only 1 percent last year, the brand says.

Pepsi also sponsored the 2014 halftime show, but its campaign that year only began in January. For the 2015 performance, the brand started things a few months earlier and tripled the amount of materials it released compared to the previous year.

Content ranged from a commercial featuring Blake Shelton giving a surprise concert on an aircraft carrier for military veterans (see below) to offline activations like a crop circle of the Pepsi logo that is visible when flying over the Phoenix area. Its Super Bowl ad, which was created by the team that produced the film Gravity, features 23 Pepsi logos without mentioning the brand name out loud.

Pepsi's Super Bowl Sponsorship Paid Off Where It Counts—in Store Aisles

via AdWeek

Marketing research about Super Bowl shopping bodes well for PepsiCo.

You pride yourself on independent thinking—heck, let's say you even have a master's degree in philosophy. But just like any American, you were shopping last weekend for potato chips in Aisle 7 as you prepared for the Big Game party.

Let's say the aisle display for Kettle Chips didn't employ anything resembling Super Bowl-related or football-themed creative, while the cardboard signage for PepsiCo's Lay's next to it was adorned with such insignias. There's a one-in-three chance you grabbed a bag of Lay'sbecause of its creative, according to market research vendor Instantly. Indeed, snack and beverage purchase decisions can be about presentation as much as price and product.

The Los Angeles-based Instantly, which was formerly called uSamp and is announcing itsrebrand this week, offers a bevy of market research products and survey services. It posed questions to 299 consumers from Jan. 29 through Feb. 1 to discover what snacks and beverages they were buying for the game and why.

Other key findings included: Consumers react positively to large and eye-catching designs, and PepsiCo has mastered the art of Super Bowl display. When given the choice of Super Bowl advertisers, 32 percent of consumers said they liked PepsiCo products the best. It helps that the Purchase, N.Y.-based soda giant was a chief sponsor of NBC's Big Game telecast, therefore having the right to use official Super Bowl symbols. But the consumer psychology of it all is still pretty interesting.

Check out Instantly's infographic from its new research.

Pepsi Tells Us Why A Super Bowl Ad Should Never Just Be A One-Off

via BusinessInsider

Pepsi-owner PepsiCo is spending a huge amount of its budget on the Super Bowl this year.

It has a raft of ads and marketing activity planned for the big game across its portfolio of brands. Not least: Pepsi sponsoring the huge half-time show, which will feature Katy Perry and Lenny Kravitz. (We’ve listed everything we know so far about PepsiCo’s Super Bowl plans at the end of this article.)

Many other brands have started teasing their ad campaigns over the past few weeks as excitement builds toward kick-off on February 1. But PepsiCo says its Super Bowl campaign is the culmination of a season’s worth of activity.

We spoke over the phone with the chief marketing officer of Frito-Lay Ram Krishnan (which is promoting Doritos during the game) and Pepsi’s chief marketing officer for North American beverages Simon Lowden (who is also responsible for the Mountain Dew ads running ahead of the game) about why brands that just dip in and out of the Super Bowl or buy ads as a one-off are missing the real attraction of the big game.

PepsiCo is three years into a 10-year deal with the NFL (but its relationship stretches back 31 years) and this year will mark the fourth time Pepsi has sponsored the half time show (you might remember Bruno Mars and the Red Hot Chili Peppers from last year’s game.) Many of its brands are now intertwined with the NFL: Gatorade has been the official sports drink of the league since 1983 and Doritos has been running its “Crash the Super Bowl” since 2006.

Krishnan told us: “If you spend $3.5 million or $4.5 million on a Super Bowl spot, if you don’t have consumer engagement throughout the whole season, I’m not sure that pays off. The Super Bowl is the big day, but [for us] it’s the culmination of a whole year of effort.”

Lowden added: “There are 185 million domestic fans for football. The great thing about the NFL is that every game is like the FA Cup Final. Every game matters.”

So for PepsiCo brands, Super Bowl activity really starts way back in September. That’s when Doritos relaunched its long-running “Crash the Super Bowl” competition in which it asks consumers to send in their entries for their videos to be made into the brand’s big game ad, for example. The competition received about 4,900 entries, and the finalists’ videos — which can be viewed on a dedicated website — have racked up more than 3.2 billion impressions.

Here's one of the entrants bidding for a Super Bowl ad slot (and a $1 million prize): 

Meanwhile, Pepsi’s Super Bowl-related activity has achieved 1 billion impressions since the end of November, Lowden says, although that has been helped by some TV teasers.

But even with the season-long rhetoric in mind, PepsiCo has still forked out a considerable amount on the game itself: The half time show doesn’t come cheap, it has purchased several of those coveted $4.5 million 30-second slots, and that’s not to mention the second-screen paid activity it has planned with Facebook and Twitter. Clearly there’s something about the Super Bowl itself that PepsiCo thinks will pay off?

Lowden tells us: “What we know is we have a 70% year on year increase in better in-store programs with [retailers]. Snacks and beverages together. These are on-shelf displays that we would not get without the NFL program. That’s part of how we measure success.”

Basically, on and around the big game, PepsiCo’s massive marketing program drives traffic into stores. Retailers love this and offer up more shelf space and coveted end-of-aisle slots. PepsiCo sells more products. It’s a perfect circle. But it’s something that can only come out of its brand’s already-strong associations with the NFL — something many brand advertisers simply don’t and likely never will have so long as PepsiCo continues its relationship with the league.

Lowden adds: “The NFL would say their best partner, without a doubt, is PepsiCo. We are three years into a 10-year deal. With that comes enormous trust and planning: We started planning Super Bowl 50 in San Francisco a year ago. We plan together and become part of the brand team.”

With that comes access to shared data about what motivates people to watch games and buy related snacks and drinks. And that’s something that only comes with a relationship, not a one-off punt.

PepsiCo is prepping its “biggest activation ever” during the Super Bowl this year. Here’s what it has planned:

Pepsi

Sponsoring the half-time show starring Katy Perry and Lenny Kravitz, plus a lead-in commercial.

Viewers can even "shop" the half time show, buying the items that appear on screen via platforms like Twitter thanks to a partnership with ShopTV.

Paid-for Twitter Amplify and Facebook activity to promote the second-screen experience throughout the show.

Outdoor advertising all over the Phoenix area, where the game is being played — including mysterious crop circles. Lowden told us Pepsi is playing on the theme of the desert and we should think "Close Encounters of the Third Kind."

On January 18 the brand held a concert with a performance form Nico & Vinz as part of a “Hype Your Hometown” competition.

Doritos

Two “Crash the Super Bowl” ads.

Mountain Dew

11 ads during the Super Bowl pre-game show to showcase two new “KICKSTART” flavors.

Tostidos

The official chip and dip sponsor of the NFL is hosting a Super Bowl party experience from January 28 to February 1 in downtown Phoenix.

And that's not to mention all the in-store and on-pack activity across many more of PepsiCo's brands.

Pepsi, Not Aliens, Is Behind Crop Circle Near Super Bowl Stadium

via Creativity

A crop circle mysteriously appeared in Glendale, Arizona, half a mile from where the Super Bowl will take place at the University of Phoenix Stadium. The giant icon bears a familiar beverage giant's logo and spans 120 yards, which happens to be the size of a professional football field. Is this the product of football-loving extra-terrestrials? Nope, just part of Pepsi's marketing push for the big game, created out of Mekanism.

The advertiser, which is sponsoring the Halftime Show, promises an "out-of-this-world" performance from Katy Perry and created the circle as part of its ad efforts. The campaign also includes this sci-fi themed teaser spot about "strange things are happening in the desert," which hints at how Pepsi will introduce the pop star before her performance.

PepsiCo Expands Distribution of Stevia-Sweetened Cola

via WallStreetJournal

ENLARGE

Pepsi True PHOTO: PEPSICO/ASSOCIATED PRESS

The stevia cola wars are slowly heating up as PepsiCo Inc. and rivalCoca-Cola Co. try to tap growing consumer thirst for natural sweeteners.

PepsiCo confirmed Monday it is starting a limited rollout of stevia-sweetened Pepsi True in stores in Denver, Minneapolis and Washington this week after launching the reduced-calorie cola on Amazon.com last October.

The expansion beyond online sales follows in Coke’s footsteps, which launched stevia-sweetened Coca-Cola Life in a small number of U.S. stores last August before expanding it nationally last November.

Beverage Digest, a trade publication, tweeted PepsiCo’s expanded distribution plans earlier Monday.

PepsiCo and Coke are hoping the zero-calorie sweetener, derived from the stevia plant, will lure back some consumers after a decadelong decline in U.S. soda volumes. Many calorie-conscious Americans have scaled back on regular soda, which is typically sweetened with high-fructose corn syrup. Growing numbers also are dropping diet soda because of health concerns over artificial sweeteners like aspartame.

Stevia can leave a bitter aftertaste and Coke and PepsiCo continue to experiment with formulations. Pepsi True and Coca-Cola Life are both sweetened with a mix of stevia and cane sugar.

Pepsi True and Coca-Cola Life both feature green-colored packaging to play up the use of natural sweeteners. U.S. store sales of natural sweeteners including agave, monk fruit and honey have risen in recent years and a growing number of consumers say they try to avoid high-fructose corn syrup, which they view as less natural than traditional sugar.

Pepsi True has 40% fewer calories than regular Pepsi. It will be sold in 10-ounce cans and 12-ounce glass bottles in the three cities, in addition to the 60-calorie, 7.5-ounce cans already sold online at Amazon.com and Walmart.com.

Coca-Cola Life has 35% fewer calories than regular Coke. In addition to the 60-calorie, 8-ounce glass bottles launched last year, it is now also available in 12-ounce cans and 20-ounce bottles nationally.

Andrea Foote, a PepsiCo spokeswoman, said there are no current plans to distribute Pepsi True nationally as the company continues to gauge consumer reaction. But “we feel good’’ about initial online orders, said Ms. Foote, who declined to share any hard sales data.

Scott Williamson, a Coca-Cola spokesman, also declined to share any hard sales data but said the rollout has been encouraging so far. “While still early, we’re pleased with how it is performing,’’ he said.