Coke's New 'Vault' Citrus-Energy CSD:
Holds Same C-Store Share in 20-oz
As Sprite in Test Markets.

Vault -- Coke's new citrus energy CSD with lower carbonation -- appears to be off to strong start in test markets. Product will launch nationally in February in regular and diet as "Vault Zero." In 20-oz PET in C-stores, brand held 1.5 share of total CSD category in September in test markets, equaling share of stable-mate Sprite (table). It is still far behind Pepsi's Mt. Dew, with which it is designed to compete. Dew's 20-oz C-store share in September was 7.2, up +0.1. In data spanning launch through September, Dew's share is actually up +0.2. Pricing. As is the case with early trial periods of most new brands, Vault's pricing is below other CSD brands. For example, average C-store price of 20-oz Vault in test markets was $1 vs $1.17 for Mt. Dew. Most data/facts in this story come from Coke system information document, of which BD obtained a copy.

Details. Vault was launched in its test markets in early June. Initially, product was mainly available in 20-oz and 12-oz cans for vending. Though some markets had 2-liter and 12-pack cans from start, in most markets those packages were introduced in July and/or August. Bottlers and test markets. Bottlers in test were CCE, Coke Consolidated and Coke United. Territories included: 1) Consolidated system-wide. 2) United in Birmingham AL and Chattanooga TN. 3) CCE in parts of Tennessee and Michigan. Channels/ packages. 20-oz represents majority of Vault volume; C-stores account for about 43%.

Results; below forecast. Coke system executives seem pleased with early returns on Vault, though document notes volume since launch equals "90% of forecast"; cites heavy focus on immediate consumption and suggests ramp-up of future consumption packages "will close the gap." From June through Sept, Coke sold about 2.6 mil cases of Vault in test markets. Document indicates Vault has helped Coke's overall C-store 20-oz performance relative to non-test markets.

Share changes. Though Mt. Dew's 20-oz C-store share has grown overall in Vault test markets (table), document claims it has lost some share of 20-oz regular citrus CSD sub-segment. For example, document claims after four months, Vault 20-oz in C-stores held 14.5 share of "20-oz regular citrus," while Mt. Dew's share in that sample had slipped from 79.5 to 67.4. In supermarkets in Vault test markets, Vault held overall 0.6 share in most recent period. Compares to Mt. Dew at 7.2 and Mello Yello at 1.0.

Trial and repeat. Document says 7% of households in test markets have made "trial purchase" of Vault. Among them, 38% "have returned to brand at least once." Adds, "repeaters are averaging 2.1 additional repeats beyond their first repeat."

Perspective. Coke system executive says Vault in test markets is "a success." Strategy was "to go after Mt. Dew in C-stores. They've had (segment) almost to themselves."