GLOBAL: Molson Coors turns to product pipeline in innovations chase
Molson Coors is ready with its pipeline
Molson Coors has flipped its innovations focus from packaging to line extensions, with an “exciting pipeline” lined up for the next three years, its CEO has said.
Peter Swinburn told analysts in a call yesterday (13 June) Molson's innovations mix is now 60% new products compared to 80% packaging previously. “(Packaging) doesn't always bring the premium pricing that you want," Swinburn said.
"New product innovation is much more difficult, but it does bring the margins, certainly in the short term," he added.
Swinburn said Molson has already launched new extensions including Redd's Apple Ale, Carling and Molson Ciders, Molson Canadian Wheat, and Rickard's Summer Shandy, and expects 7% of net sales this year to come from innovations.
“Innovation is key to our portfolio strategy, and therefore, key to our growth strategy. So far, we are right where we plan to be and have an exciting pipeline that is full for the next three years,” he said.
Swinburn denied growth for line extensions such as Coors Light Iced T and Carling Zest will come at the expense of Molson Coor's core brands, which generate 60% of volumes and “even more of our profit”.
“Generally what you find is that 40% to 60% of the consumers (for line extensions) come from the outside of the franchise,” he said. “So what we're doing is we're not cannibalizing. We're improving our margins and increasing the size of the category.”
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