New Coke CEO pours energy into digital-age advancements
As Coca-Cola chief executive officer James Quincey settles into his new job, he’s facing a challenge that most of his predecessors never worried about: digital disruption.
Consumers are increasingly shopping online, spending more time on mobile apps and getting groceries delivered to their homes. And that’s hitting Coca-Cola in ways you might not expect, Quincey said in an interview from his office in Atlanta, Ga.
When shoppers skip trips to the local mall and get their clothes at Amazon, they also forgo buying Coke at a vending machine or food court. So while the decline of retailers has mostly focused on bankrupt apparel chains and shuttered storefronts, Coca-Cola is suffering as well.
“Digital is changing the way you behave,” he said. “It affects other categories that are not the primary reason you thought about making the shopping trip.”
Turning Coke into a winner of the digital age — rather than another brick-and-mortar victim — is a key priority for Quincey. The technological challenges faced by the 52-yearold executive, who took the reins from Muhtar Kent on May 1, are compounded by a backlash against sugary beverages. The upheaval has led the soda giant to invest in new brands such as Suja Life and Aloe Gloe, product lines that appeal to health-conscious consumers.
Quincey also is slashing expenses and off-loading large swaths of its bottling plants around the world in a bid to re-emerge as a leaner, more focused operation. As its sales slip, Coca-Cola has seen its stock decline 4.9 per cent in the past year. That compares with a 15-per-cent gain for the Standard & Poor’s 500 Index.
But tech is a main focus for Quincey, who has spent two decades at Coca-Cola. He wants to modernize the 131-year-old company. At the same time, technology is helping Coke cut its own costs. For one, the company is no longer building customized software to run things such as human resources and bill payment, relying instead on cheaper ready-made systems. The company is cutting 1,200 positions, in part because it’s spinning off bottling plants.