According to an article by Jordan Valinsky, though Coke Energy had just hit shelves in January 2020, the pandemic altered the beverage giant’s business strategy. In a statement, Coke said that it’s focusing on the drinks that are selling well, including its caffeinated sparkling water and traditional sodas.
“An important component to this strategy is the consistent and constant evaluation of what’s performing and what’s not,” said the statement. “As we scale our best innovations quickly and effectively, like AHA and Coca-Cola with Coffee, we need to be disciplined with those that don’t get the traction required for further investment.”
Last year the Atlanta-based company announced it was discontinuing 200 brands, or about half of its portfolio.
About half its portfolio! Can you imagine an association ever doing anything similar?
The pandemic provided a sunsetting tailwind for many associations, but others have struggled with eliminating anything from their portfolio. This is a powerful “shrink to grow” strategy regularly employed by for-profit companies—and one we can learn from.
When Steve Jobs returned to Apple after a twelve-year absence, he directed the elimination of 70 percent of the product line. (Again: can you imagine?) This strategy fueled a turnaround from a $1.04 billion loss in 1997 to a $309 million profit in 1998—an amazing shift in just one year. This shows how powerful purposeful abandonment can be.
How are you currently employing this strategy?