Oct 20, 2009 at 07:43 PM
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Coca-Cola Raises Point-of-Sale Activation

Coca-Cola reported earnings of $1.896 billion (as comparted to $1.890 billion y/y), but 6% lower revenue, in some part due to foreign currency exchange. In this morning's Coca-Cola Q3 conference call, Chairman & CEO Muhtar Kent, offered up three partnership strategies that the company is applying to fight the headwinds of slower consumer spending, specifically at point of purchase:

"I also want to call out a few examples of how we are creating value through our marketing programs and proprietary global partnerships. First, we are leveraging existing global partnerships to connect directly with our consumers. For example we have just launched our FIFA activation program, including a 225 day, 86 country FIFA World Cup Trophy tour. Simultaneously we are well into our preparations for the in upcoming Winter Olympics in Vancouver including the launch of our Olympic Torch Relay event.

Second, we are expanding our strategic sponsorship and marketing alliances as in the case of our recently announced agreement with Live Nation. Coca-Cola has a long history of connecting with consumers through their passion for music. So it makes perfect sense for Live Nation the world’s largest concert promoter and Coca-Cola to team up and Open Happiness across Live Nation venues.

Third, shifts in our marketing and media spend strategies are enabling us to communicate effectively and stay even more relevant with today's consumers. Specifically we are increasingly spending more in point-of-sale marketing and activation programs.

For example, in Europe, we have shifted more marketing dollars toward in-store activation, and improving shelf impact by our on pack and point-of-sale promotions and shopper marketing activities like loyalty point programs, sampling and gifts with purchases. Further, in North America, we have increased our overall in-store direct investments. In addition, we have co-invested with our bottlers to accelerate our ability to offer consumers affordable value, and inspiring new products and packages that meet their needs while creating value for our system, and for our customers.

We believe these strategies represent value creating ways to engage and win consumers within the four walls of the customer outlets. Importantly we have sustained our overall direct marketing spend in 2009, while also increasing our overall marketing effectiveness. We can confidently state that we continue to invest heavily in building our brands with consumers."

For the full transcript of today's call, visit seekingalpha.com.