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Coca-Cola Co. will pay $4.1 billion to acquire Glacéau and its health-based water brands, including Vitaminwater, according to foodproductiondaily.com.
Coca-Cola said the acquisition gives the company with a platform to grow what it calls "active lifestyle beverages," those targeting health-conscious consumers.
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Editor's Insight: This acquisition represents one of the most significant developments in response to changing consumer beverage preferences.
Beverage industry observers have noted Coke has been slower than some of its competitors to respond to the demand for noncarbonated beverages. Coke expects this acquisition will enhance its position in the market segments poised for growth.
As part of Coke, Glaceau could become the biggest beverage success story since Snapple, which also began as an independent manufacturer.
On Jan. 30, 2006, an article in The Wall Street Journal described how Glaceau, under the ownership of entrepreneur J. Darius Bikoff, waged a David-and-Goliath battle in the highly monopolized cold beverage industry. The key tools Bikoff used were the novelty of his product and some unconventional marketing strategies to encourage independent distributors and retailers to carry the product. The article noted that vitamin-enhanced waters have benefited from the dual popularity of bottled water and organic products.
One lesson that vending operators can take from this is that they have a certain amount of leverage with small product manufacturers who are trying to compete against competitors that monopolize the distribution channels. 05-29-07 by Elliot Maras
