This year, Coca-Cola introduced to Latin America a beverage designed in the metaverse to reinforce the brand’s connection to GenZ’s favorite passion points: music & gaming. It plans to make 100% of their packaging recyclable globally by 2025 and use at least 50% recycled material in their packaging by 2030. Also, by 2030, women should hold 50% of senior leadership positions in the company.
From product strategy to sustainability, the president of Latin America for The Coca-Cola Company, Henrique Braun, told Latin Trade what is in store at the soft drink maker.
Will Latin American Gen Z see new Coca-Cola products like Starlight’s ‘Intergalactic Flavors”, and Dreamworld anytime soon? What is the most valuable strategy Coca-Cola Latin America still use to enamor younger consumers?
I would tell you that there are two elements that allow us to be a benchmark in the lives of our clients and consumers: innovation and cultural understanding.
On the one hand, innovation, both in experiences and products, is a key pillar in our work across our portfolio, to be present and remain relevant for new generations. On the other hand, cultural understanding allows us to recognize exactly what our customers need and want, and act accordingly.
Just to give some examples, we brought two products to Latin America in 2022, part of Coca-Cola Creations, a global continuous engagement platform for the Coca-Cola brand. The first of these was Byte, a beverage that was created in the metaverse, and Latin America was the first region to launch it in the world. The second was Marshmello, the brand’s first ever beverage co-created with an artist. In addition, I would like to mention that for Coca-Cola Trademark next year, new Coca-Cola Creations will arrive reinforcing a strong connection to GenZ’s favorite passion points: music & gaming. Creations will land in the region bringing to live fresh limited editions and new experiences that will bring enjoyment to the breaks moment and forging new connections in both physical and virtual worlds.
We are also connecting with new generations in other brands, for example Sprite. Sprite will bring its purpose to life through music, helping teens to not lose themselves to the ‘Heat’ of the modern world, inspiring them through fresh perspectives, music, and experiences as it has done in 2022 with a refreshed image – with a clear more sustainable bottle – and its approach to create great connections through music partnering with artist across the region. This will sustain next year with platforms like Limelight, through which we are partnering with well-known artist Kali Uchis in Latin America.
Another example is our job in the new alcoholic ready-to-drink products, which are not intended for all Gen Z consumers, but for those of drinking age, with brands like Topo Chico Hard Seltzer, Schweppes Premium Drinks and the recently announced launch of Jack and Coke; where we have been exploring new opportunities with frequent innovations in selected markets to build a portfolio that fulfills the expectation of these younger generations, when becoming a legal drinking age consumer around alcohol, where low ABV (alcohol beverage volume) have a fresh proposal within their socialization moments and have great potential for growth for our brands.
Could inflation, slower GDP growth and other macroeconomic conditions negatively affect unit case volume beverage consumption Latin America in 2023? In what countries will it have this effect?
At Coca-Cola we are aware that the world is going through a complex economic context and that this can affect many industries on different levels. The Coca-Cola system as a global network has a lot of experience and learnings over 136+ years in challenging environments. One of our objectives is to utilize our Revenue Growth Management strategies and leverage learnings from various markets and economic conditions across our network to manage through maintaining affordability for consumers.
Our daily actions are aligned with our commitment to communities. Cola-Cola’s purpose is to refresh the world and make a difference, and we aspire to create a more sustainable business and a better shared future, making a difference in the lives of people, communities and our planet. Small local businesses, which are some of our strategic partners, were one of the sectors most severely hit by the pandemic. The Company assisted over 500,000 regional businesses affected by this macroeconomic situation, providing materials to ensure their safety and that of their customers, as well as training in economic support, equipment to recover their businesses, and digital tools to help expand their businesses and boost their sales.
Latin America is an important market for Coca-Cola, not only because of the weight it has in the business, but also because of the love it has for the brand, so our efforts will continue to focus on the well-being of consumers in this region.
Coca-Cola announced in February that it plans to make 25% of its global sales by volume on returnable packages by 2030, from the current 16%. What is the goal for Latin America, considering that currently 34% of its units sold are returnable? What regions of the world are still clinging to non-reusable packages?
First of all, I would like to say that we understand that the world has a packaging waste problem, and we have a responsibility to be part of the solution by creating a circular economy for these materials. As a company and a system globally, we have committed to helping achieve a World Without Waste, based on three primary goals: number one is Design, to make 100% of our packaging recyclable globally by 2025 and use at least 50% recycled material in our packaging by 2030 in addition to the returnable packages goal; number two is Collect, with the goal of collecting and recycling a bottle or can for every one we sell by 2030; and number three is Partner, to work together with communities, governments, suppliers, community recyclers and even our competitors to support a healthy, debris-free environment.
The 25% of global sales by volume in returnable packaging goal builds on our strong track record with refillable packaging, especially in Latin America, Europe, Africa and Asia. COVID-19 has accelerated consumer interest in refillables, as more families enjoyed multi-serve beverages at home and seek affordable options in uncertain economic times. In Latin America, as you mentioned, in 2021 usage of returnable packages reached more than one-third of volume-mix sales. To support the continued expansion and adoption of returnable packages, we are focusing on marketing and promoting consumer behaviors of returning packaging to enable reuse.
The Coca-Cola System is also investing around $500 million to expand availability of returnable packaging across the region to even more consumers, including marketing and expansion to new channels in digital and supermarkets in some countries, with the clear idea that the global plastic waste issue requires cross-sector collaboration and alignment on common principles and targets.
Returnable packages are made with PET (polyethylene terephthalate) or glass and can be used more than 20 times before ultimately being recycled to be remade into new packaging once its lifecycle is complete. They also use fewer resources and lower our carbon footprint in support of a circular economy.
We are also investing in the expansion of the “universal bottle” which was first introduced in 2018 by Coca-Cola Brazil and used in Argentina, Chile, Colombia, Mexico, Guatemala and Panama. This innovative solution—which the Ellen MacArthur Foundation recognizes as a great example of reusable packaging—allows a container to be filled with the same or another sparkling or still beverage from our portfolio of brands and re-marked with a new label.
We continue to share our learnings from Latin America across the Coca-Cola network with other operating units across the globe, and I know that the rollout of refillable 2-liter and 1.5-liter PET bottles is moving forward in South Africa, and in the United States, there is an active pilot of a 500- ml returnable glass bottle in Texas so globally, we are also increasing our focus on refillable packaging. We know we cannot achieve our goals alone, that is why we collaborate with partners across industry, government, and society to address key challenges, create a sustainable, efficient circular economy for packaging and reach the whole world with our initiatives.
Coca-Cola Brazil announced it will have 30% of its leadership positions go to black executives by 2030. Are there any race or gender inclusion goals in other parts of the region? When will the company’s payroll be aligned with census data by race and ethnicity in the region?
As steward of one of the world’s most inclusive brands, The Coca-Cola Company celebrates diversity, inclusion and equality always. This commitment comes to life through our workplace culture, community partnerships and policies we support.
We are ensuring we have diverse and equitable representation across our workforce, as a result of that, our Corporate Equality Index has been rated 100% since 2006. However, we recognize that much remains to be done.
By 2030, our ambition is for women to hold 50% of senior leadership positions in the company. As of today, in leadership positions for Coca-Cola Latin America, we are at 37.5% and general feminine talent represents 56%. In terms of payroll, we believe in equal pay for equal work. We define pay equity as compensating employees fairly and equitably, without regard to gender, or race and ethnicity. In 2019, we extended pay equity analysis for gender globally. In 2021, we took a deeper dive on pay equity, hiring an external consultant to conduct a global pay equity audit.
However, given the company’s significant organizational changes in 2021, we have conducted a follow-up analysis this year. We will continue to conduct annual analyses and are motivated by the opportunity to build a more equitable and inclusive culture.
For example, in 2011 Coca-Cola Brazil created a Diversity Committee focused on women leaders, but it soon began to cover other issues (race, people with disabilities and LGBT+). The internal racial affinity group was then born, with representatives from different areas and different hierarchical levels of the company. The committee promotes training, debates, prepares diagnoses and proposes affirmative actions aimed at promoting conditions favorable to diversity
Our aspiration is not only to mirror the diversity of the communities where we operate, but also to lead and advocate for a better shared future. In Coca-Cola, we empower people’s access to equal opportunities, no matter who they are or where they are from.
Any plans to help young Latin Americans thrive?
This is such a great question considering that people are always at the heart of all the strategy of our business. When it comes to young people, the strategy is clear: we are focused on ensuring that tomorrow is always better than today through their own empowerment and the betterment of the communities where they live and develop.
In Coca-Cola, we believe that youths are fundamental to build a better shared future. For that reason, we have developed programs to aid young people in entering the labor market. For example, ProgramON in Argentina, which seeks to promote the employability of the youth, it has already reached more than 5,000 young people throughout the country to date, and the company hopes to continue increasing the offer of training and participant quotas in the coming years. All programs are free and 100% online, aimed at people between 17 and 24 years old who reside anywhere in Argentina.
There is also Acción que Impacta in Brazil, which is part of the Coletivo Jovem Platform, it focuses on the employability of young people between 16 and 25 years of age, in a situation of social vulnerability. Since the beginning of its implementation in 2009, the Platform, in face-to-face and online format, has already impacted more than 329,000 young people in Brazilian communities spread throughout the 26 states of the country + the Federal District, reaching 2,413 municipalities. Of the total number of beneficiaries, more than 80,000 entered the labor market.
In addition, we seek to boost their talents through quality opportunities and inclusive education. I’m proud to say that we employ 240,000 youths of the region. We know we cannot do it alone, so we work on these efforts with many Allies across Latin America. We will keep working on providing better and more opportunities to boost their talent and help them achieve their dreams.