While consumer tastes seem to be shifting away from soda and toward healthier beverages, Coca-Cola Co.’s CEO Muhtar Kent believes the company’s best course of action is simply selling more cola. The company’s plans include earmarking an additional $1 billion for advertising spending through 2016, and overhauling its U.S. distribution network with hopes of returning the company to high single-digit growth in 2016, reported The Wall Street Journal.
The company’s devotion to the soda market, where 70% of its sales come from, is also reflected in its acquisition strategy. Rather than buy out smaller companies wholesale, Coke has been pursuing significant but minority stakes in growing companies such as Keurig and Monster, using its existing resources to slowly and carefully expand into areas such as coffee and energy drinks.
Part of the reason for this slow expansion is belief in the company’s existing portfolio, which includes 20 billion-dollar brands, 14 of which are still beverages, Minute Maid and Dasani. The company still has the right ingredients to “grow rapidly,” according to Kent.