Editor's note: The original version of this article incorrectly said that the DC Comics' illustrated story featuring LeBron James would also feature Spider-Man. This is inaccurate. We apologize for the error.
Coca-Cola's (NYSE: KO) Powerade brand is important. Case volume grew 24% in the last quarterly earnings period, way ahead of the core cola category. Continued innovation of marketing schemes is arguably Coca-Cola's main responsibility, and a new one has just been hatched.
Basketball star LeBron James assisted in the development of a new Powerade variation, dubbed "FLAVA23," which will be available beginning in September. In a way, it's like Michael Jordan helping create the latest Nike (NYSE: NKE) basketball shoe, and I think it's a compelling idea.
Coke needs to do something. PepsiCo's (NYSE: PEP) Gatorade is a fierce competitor, and to many in the youthful demographics, that brand is "it" when refueling after working up a good sweat. I can attest to this personally. As a shareholder of Coca-Cola, I try to get my younger colleagues to reach for the Powerade instead of the dreaded competition. They laugh at my suggestion (guess I'm not one of Coke's better sales reps).
The launch will be supported by a comic book developed by Time Warner's (NYSE: TWX) DC Comics, which is a pretty cool and savvy aim at capitalizing on the heat comic book properties are feeling these days. The illustrated story, which will involve Mr. James, will be distributed free with certain purchasing requirements.
Coca-Cola needs to build growth in its case-volume metric. A campaign like this, which ties itself to some hot properties, should aid in this growth quest. New flavors can oftentimes add interest to a brand, but a new flavor associated with a star like LeBron James has the potential to amplify such appeal. Here's my one reservation: deal structure. I hope Coke didn't give up too much in securing this initiative; the company generates a lot of free cash, and I want as much of it as possible to power up my dividend increases.
For more on beverage industry happenings, the following will be of interest:
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Steven Mallas owns shares of Coca-Cola, but none of the other companies mentioned.
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