What Are ‘Boost Zones’?

Coca-Cola has begun introducing in the US a concept they developed in Europe, called ‘boost zones’. A boost zone is an urban area (maybe just a few blocks to a few square miles) where Coke and their local bottler work to maximize the visibility (and hence the sales) of Coke.

The idea has been in practice for five years in Europe, with prominent areas targeted:

“Walk around Windsor Castle. It’s red,” Coca-Cola Enterprises CEO John Brock said at an investor conference in May. “And every account up and down the street you’re going to see, is going to have our brands there.”

There are now 300 such zones in Europe. Coca-Cola has thus far developed fifty in the US, with plans to double that next year. The examples cited in the article are restaurants and fast food places, but the concept could be applied to retailers.
Coca-Cola takes a highly collaborative approach to working with customers in a boost zone, to the point of helping small restaurants redo their menus:

Coca-Cola spent at least $5,000 to make over Hovan Mediterranean Gourmet, a walk-up food court counter at Lenox Mall, in its own image, said owner Ahmed Darrar. The soda maker spent several weeks helping Darrar develop a new menu, including combo meals with a sandwich, side and drink.
“My business increased 25 percent to 27 percent in the month after Coke did this,” said Darrar, 55, wearing a white Coke visor and a red Coke shirt with Hovan embroidered on one breast. “I’m happy to wear their logo if I get that increase.”

A nice ROI. Other figures cited are even nicer: “The Lenox zone [in Atlanta] has 250 outlets, from vending machines to hotel bars. Annual volume sales at the mall itself grew 90 percent after the boost zone was put in place …”

The price of such success may be higher than some customers are willing to pay, though. Another small restaurant threw out the Coke paraphernalia after a single day, saying that it added to clutter (the owner also noted that she wasn’t willing to give up selling competitive products).

The effort seems really exciting, and it will be interesting to watch how it plays out, and how it is applied in supermarkets, discounters, and c-stores. And clearly something has to be done: “Coca-Cola and PepsiCo Inc., the world’s second-largest soft-drink maker, both lost share of the U.S. soda market in 2008 as soft-drink sales fell for the fourth straight year, according to industry newsletter Beverage Digest.”

Poll Question: Will the ‘boost zones’ strategy result in significant share gains for Coca-Cola in 2010?