Dr Pepper Snapple Group sees merit in smaller packs - just On Call
A combination of diet products are needed to satisfy consumers, according to Dr Pepper Snapple
Dr Pepper Snapple Group is set to look at smaller pack sizes to improve price/mix.
Speaking to analysts during a conference call following the announcement of its second-quarter results, DPSG's chief financial officer, Marty Ellen, acknowledged that his competitors had made moves in this area. Earlier this week, The Coca-Cola Co said smaller pack sizes were driving positive growth in the US.
Ellen said: "One of our competitors... in particular has an abundance of different package sizes... smaller package sizes." Ellen flagged, however, that he company does have smaller pack sizes, in the markets where it sells brand Dr. Pepper. But, he said DPSG would not have as many variations as competitors.
"We, too, are moving down that pathway," he said. "I doubt you'll see us have as many packages. We're not sure that that added complexity makes sense for our operating model, but [it] does make sense at the top line and for our consumers.
"And so you're going to see us moving down a little bit. So, they're advantaged in terms of price-per-equivalent-ounce that they can capture."
How did Dr Pepper Snapple's brands perform? Click here for our drill-down into the results.
Also in the call, president & CEO Larry Young talked about the changing diet market in soft drinks. As PepsiCo readies an aspartame-free diet variation in the US, DPSG is also looking at different approaches to diet drinks, although Young added that, when it comes to Diet Dr Pepper, he felt consumers are "very satisfied... with the aspartame". On the innovation front, Young said the diet landscape is "going to be a combination of diet, mid-cals, natural, the Tens".
Ten is a 10-calorie version of several DPSG brands, which were launched in 2011.
"You take our Ten product, we've got a great consumer base there," Young added. "You've got people that are maybe happier with a mid-cal if it's natural. We're very excited about seeing our diets kind of bucking the trend out there right now. Diet Dr Pepper was down 3%...
"You've heard us talk about it in the first quarter that we were putting some immediate marketing against Diet Dr Pepper, and everything's showing us it's working."
Last month, the group said it would up its focus on Hispanic consumers in the US, through increased marketing across several of its brands.
- Why Scotch must drop the 'malts good, blends bad'
- Pernod's mood darkens over India - Analysis
- Heineken Q1 2017 by region - results data
- Remy Cointreau Fiscal-2017 sales - results data
- Soft drinks is losing the recycling game
- Diageo to cut 105 jobs in Scotland, 50 in Italy
- Scotch sales set to soar, despite recent struggles
- Edrington shifts innovation to US in shake-up
- TWE's Beringer Main & Vine Dry Rosé - NPD
- Pernod Ricard posts solid YTD sales jump - results
- Global Champagne and sparkling wine insights - market forecasts, product innovation and consumer trends
- Global Scotch insights - market forecasts, product innovation and consumer trends
- Battle of the Generations - The fight for iGen, Millennial, Gen X and Baby Boomer consumers
- Myanmar - ISA Country Report
- Top Trends in Hot Drinks 2017