December 21, 2010

The Cola Wars: Don’t Take on Coke

There’s been a buzz around town about the increase in Coke’s (NYSE: KO) stock price over the past several months.  Coke is THE symbol of Atlanta, so naturally there’s a huge interest in their success and the demise of the main competitor.

If I may digress, you can pinpoint the turnaround on March 5, 2009 with Muhtar Kent’s inspiring letter to shareholders.  Mr. Kent’s first job with Coke was in 1978 as a driver and he has risen steadily through the system to CEO and is deservedly compensated quite handsomely ($19.6M in 2008, $14.8M in 2009).  According to the AJC, this could buy you 1.5 personal jets, 109.5 houses and 192.25 luxury SUVs.

When measuring Coke’s performance there’s only one large competitor (yes, I’m intentionally NOT mentioning their name).  I created the dashboard below to do some basic analysis, plus I wanted to get some practice with parameters in Tableau.


Some basic things I see:
  1. The New Coke disaster in 1986 didn’t hurt as much as you would be led to believe by the media (it tasted terrible!)
  2. Coke’s stock is up 85% from a two-year low point in March 2009
  3. Strictly based on price, Coke has been getting killed by its main competitor since 2003, but has effectively closed the gap
  4. When I looked at closing price and shares traded vs. the main competitor, it looks like there is an inverse relationship.  I created the dual axis chart as another way to make this comparison
With Muhtar’s passion and the resurgence of the Coke brand, Coke is poised to stomp the competition!  Don’t be like Richard Branson; he learned the hard way that you don’t take on Coke (anyone remember Virgin Cola?).

Finally, I was given a 6-pack of glass bottles to share over the holidays.  There is a photo contest for the best holiday celebration including these Cokes.  Any ideas?

Shake Up Christmas!