Coca-Cola (NYSE:KO) doesn't want to be seen as a pusher -- a soft drink pusher, that is. According to a Dow Jones article on Friday, the beverage giant has come up with new guidelines for providing its products in schools, with an emphasis on limiting kids' intake of carbonated drinks.
With obesity such a hot topic -- particularly childhood obesity that's leading to more health problems, such as higher rates of juvenile diabetes and greater chances of early-onset heart disease -- it's hardly a revolutionary idea.
There's little temptation to consider this a benevolent or even a very savvy move on Coke's part. After all, government bodies have mulled restrictions on soda sales in schools for quite some time and some schools are ditching soft drinks altogether.
The cigarette industry is a high-profile subject of scrutiny for marketing to minors, which is a similar concept here. After all, companies such as Coke or its rival Pepsi (NYSE:PEP) that provide their wares in schools hook their customers early. In this case, it's not just about sales, but also about locking in loyalty at a young age, and when this tactic is overt, it's frowned upon.
Coke's still got plenty of other less fizzy and sugary beverages in its portfolio that are more appropriate for children and young adults. These include fruit juice (Minute Maid) and good old-fashioned bottled water (Dasani). After all, trying to change the in-school emphasis to its more healthy alternatives is preferable to outright banishment.
Among the initiatives the article outlined include not offering fizzy drinks in elementary schools, instead sticking to its juice, milk-based drinks, water, and sports drinks; providing carbonated fare in middle and high school vending machines but not in cafeterias; installing timers on the machine to control when sodas are doled out; and revamping the graphics on its school-based vending machines to focus on wholesome ideas like education and health as opposed to the almighty brand.
Investors can be relieved that Coke markets beverages other than its namesake high-sugar, low-nutrition soft drinks, with public opinion as it is. However, juices and waters could be a very tough sell when soft drinks are allowed on the home front, and kids are notoriously enamored of caffeine- and sugar-laden fizzy drinks.
Will Coke and rival Pepsi need to come up with new ways to replace revenues from the schoolyard set? Share your thoughts with other Fools on the Coke and Pepsi discussion boards.
Alyce Lomax welcomes your feedback at [email protected].
