Top news this morning is The Coca-Cola Company’s acquisition of Costa Coffee from Whitbread – for a whopping £3.9bn.
According to a report from the Allegra World Coffee Portal, ProjectCafé2018 UK , the UK coffee shop market grew by 7.3% in turnover during 2017 to £9.6bn, continuing as one of the UK’s most robust business sectors.
Top three chains, Costa, Starbucks and Caffe Nero comprise 53% of the total branded coffee chain market in the UK, with Costa being the largest as well as the nations favourite.
A ‘total beverage company’ strategy for Coca-Cola
Last October, Coca-Cola’s CEO James Quincey revealed that the company was attempting to reconfigure the business to become a total beverage company, providing the ability to tap into new sectors such as the growing premium adult beverage market.
The change of course comes as the sparkling sector continues sluggish sales, with more consumers opting for healthier alternatives. In addition, the sugar tax, according to soft drinks commentator, Richard Corbett ‘has certainly not made the sky fall in’ but the results remain difficult to conclude.
A brand match made in heaven – how will the Costa brand change under new management? Brevity speculate…
From a visual perspective Coca-Cola’s flagship brand ‘Coca-Cola’ and Costa already have a similar look. Perhaps we’ll see the Costa red getting slightly brighter or indeed a more muted red for both brands.
One thing’s certain, Coca-Cola is forcefully driving forward their ‘total beverage company’ strategy. Seemingly not shy of Brexit uncertainty, they’ve now entered a highly performing sector and will be thirsty to increase sector dominance.
I guess it’s a case of watch this space.