Coca-Cola CEO’s favorite emerging market is the US
The topsy-turvy start to the new year in financial markets has not affected American shoppers yet, Coca-Cola (KO) Chairman and CEO Muhtar Kent said Thursday.
“The financial contagion … has not passed over the wall to the consumer. And hopefully it will stay that way,” he told CNBC’s “Squawk Box” in an interview from the World Economic Forum in Davos, Switzerland.
But he said, “What used to be the darlings, and the BRICS, and the emerging countries is no longer.” The term “BRICS” refers to the economies of Brazil, Russia, India, China and South Africa.
“I like to say, ‘My favorite emerging market right now is the United States of America,'” Kent said, ironically, acknowledging the treacherous global marketplace where the stronger dollar has been making it tough for multinational companies.
“Everything is volatile. Commodities are volatile,” he observed, though Kent did say cheaper oil been a boon in the past six months. “It does help with distribution costs, but more important than that … particularly in a place like the United States, it helps the consumer.”
Kent didn’t want to talk specifically about company financials so close to the Feb. 9 release of fourth-quarter and full-year 2015 earnings. But he did speak more broadly about how Coca-Cola is adapting to consumer tastes.
“Consumers just want more choice,” Kent said, pointing to what he called Coca-Cola’s “exponential” transformation over the past century from a one-product, one-brand company to now having more than 500 brands and 3,500 products.
“[Even] 20 years ago, we had 20 times less products, so a twentyfold increase in the number of products,” he said. “Come two years from now we’ll have many more.”
Kent said, “Most of these [new] products have been developed internally,” with only a “small percentage” being acquired.
Against the backdrop of critics who take Coca-Cola and other soda makers to task for making sugary drinks, Kent acknowledged that noncarbonated beverages “may grow slightly faster” than sparkling drinks going forward. But he insisted that both categories will continue to expand.
At an event in Paris on Tuesday, the company said it’s uniting all its Coke brands under one message, “Taste the Feeling,” replacing its 7-year-old slogan “Open Happiness.”
Last week, Coke announced top-ranked golfer Jordan Spieth, who won two majors last year and the FedEx Cup, will become a brand ambassador for the soft drink giant.