FMCG giant Coca-Cola is planning to launch its own range of Coca-Cola branded energy drinks, a first for the drinks brand, which is moving towards healthier drinks options from its traditional soft drinks portfolio.
Coca-Cola told Reuters that it is planning to launch new drinks under the names “Coca-Cola Energy” and “Coca-Cola Energy No Sugar”. The proposed energy drink contains naturally-derived caffeine and guarana extract.
In 2015, Coke bought a 16.7 per cent stake in energy drinks maker, Monster Energy, making it the largest shareholder in the company. The soft drinks giant has rights to distribute the energy drinks range in the US and Canada and it later expanded the deal to include distribution in other markets overseas.
WSJ reports Coke also transferred ownership of its energy drinks business, including NOS and Full Throttle, to Monster Energy. The deal prevents Coke from distributing competitive energy drinks, but includes an exception for products marketed under the Coca-Cola brand.
However, the partnership has turned sour as the beverage giants are currently in arbitration over the launch of Coke energy drinks, which would be in direct competition with Monster Energy.
“Coca-Cola has developed two energy products it believes it may market under an exception relating to the [Coke] brand. We believe that the exception does not apply,” Monster chief executive Rodney Sacks said on a conference call with analysts on Wednesday, according to WSJ. Sacks added that Coke is eyeing to launch the new energy drink before April.
“We have submitted the difference in interpretation to an arbitration panel for resolution, which is the mechanism agreed by the Coca-Cola Co and Monster in the original agreements,” a Coca-Cola spokesperson said to Reuters.
Many who took to social media were sceptical of Coke’s new energy drink.
Monster Beverage is having a bit of a scrap with Coca-Cola cos Coke wants to sell its own energy drinks … one analyst says Coke's would never catch onhttps://t.co/HHmYnonOXd pic.twitter.com/dvLgvetqu2
— ciara linnane (@LinnaneCiara) November 8, 2018
Coca-Cola on a healthier path
The soft drinks giant has been making waves down under this year, as it explores other healthy drinks options.
The company added its first line of kombucha through the acquisition of Australia’s Organic & Raw Trading Co., which makes the MOJO brand of organic kombucha drinks. Kombucha is made from fermented tea and is the fastest-growing beverage category in Australia. The acquisition is the first time Coca-Cola acquired full ownership of a brand in the category.
Last month, the soft drinks giant confirmed the purchase of a 45 per cent stake in Australia’s Made Group in a joint acquisition with local drinks distributor Coca-Cola Amatil. Made’s portfolio includes cold-pressed juice, high-protein smoothies, probiotic milk and coconut water.