I find the soda aisle in the local grocery store a confusing area these days. The flavor variations have become nothing short of mind-boggling. Now, Coca-Cola (NYSE: KO) will be adding a new novelty to its lineup -- it is discontinuing its Vanilla Coke line and replacing it with Diet Black Cherry Vanilla Coke and regular Black Cherry Vanilla Coke starting in January.
Vanilla Coke was quite the craze when it was introduced. It was described as a significant contributor in 2004. But apparently, the novelty has worn off -- sales of the Vanilla Coke and Diet Vanilla Coke products have dropped. (Just in case you were wondering, the company is also in the midst of phasing out Diet Coke with Lemon.) Vanilla fans might take some solace in knowing that they're not losing the vanilla -- they're just gaining some black cherry to go with it.
Rotating flavor variations in and out is by no means a new idea, but this recent news makes it clear that with the exception of the flagship basic flavors, novelty may very well be the way things work for soda purveyors. Coke, a Motley Fool Inside Value pick, recently announced plans to reinvigorate its Fresca line, with new versions of Sparkling Citrus Peach Fresca and Sparkling Black Cherry Fresca to join its original version on the shelves.
And of course, this flavor innovation is by no means limited to Coke. Rival Pepsi (NYSE: PEP) has also been trying the same strategy. In fact, it's not unusual these days to find seasonal flavors and colors of old soft drinks. Blue Mountain Dew served at Taco Bell last year was one such attempt.
While I find all the varieties of soda a bit overwhelming (I happen to be a Diet Coke purist, preferring its tried-and-true classic formula), it's not hard to imagine that introducing variety is a good way to keep the soda flowing. It happens even outside the soda business -- for example, Starbucks rotates many seasonal offerings onto its beverage menu to appeal to consumers' taste for variety.
Spinning new flavors or formulas into the mix is not always successful, however. Look at the formulas created to cater to the low-carb craze, like C2. However, in the long run, in a mature market like the one that exists for soft drinks, it seems that innovation could go a long way in driving consumers' thirst.
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Alyce Lomax owns shares of Starbucks but of none of the other companies mentioned.
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