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CCE Plans to Distribute Honest Tea in US Western Markets |
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Friday, 25 July 2008 |
Atlanta-based Coca-Cola Enterprises, Coca-Cola Co.'s largest bottling partner, will begin distributing Honest Tea beverages in late September in some western U.S. markets, CCE announced Thursday.
Through its Los Angeles bottler, CCE will carry nine flavors of Honest Tea and Honest Ade in 16.9-ounce plastic bottles. The pilot markets include Las Vegas, Northern California, Arizona, Oregon and Washington.
Honest Tea, based in Bethesda, Md., makes organic tea and juice drinks. Coca-Cola bought a 40 percent stake in the company in February. CCE sells about 80 percent of Coke's bottle and can volume in North America.
"Honest Tea is a leader in the rapidly growing organic beverage business, and CCE's world-class distribution system can help bring these brands to more consumers in the Western United States," Terry Fitch, vice president and general manager of CCE's West Business Unit, said in a statement. "In addition to further strengthening our tea portfolio, Honest Tea embodies socially responsible business practices that fit very well within our increasing focus on corporate responsibility and sustainability."
Honest Tea has been viewed as one way to help Coke and CCE catch up with PepsiCo and its bottlers in the tea category. Pepsi's Lipton brand led the U.S. tea category with 38 percent of the take-home market in the first quarter, according to Beverage Digest figures.
"Coke needs work on its tea portfolio," said John Sicher, editor and publisher of Beverage Digest. "This won't add a lot of share overnight, but it's a good addition and a good start."
The agreement announced Thursday is likely a precursor to a broader launch by CCE, he said.
"The West Coast pilot program is to calibrate the distribution, the merchandising, the pricing and the package configuration before they do a wider rollout," Sicher said.
Honest Tea is one of several noncarbonated soft drink brands bought in all or part by Coca-Cola in the past year and a half.
In 2007, Coke bought Fuze, a juice and tea company, and Glaceau, maker of Vitaminwater and Smartwater. Noncarbonated beverages, such as tea, juice and flavored waters, have grown in recent years in the U.S. while carbonated soft drinks have declined.
Copyright 2008 The Atlanta Journal-Constitution
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