Loeb launches new cola

As if Coke and Pepsi do not have enough troubles with the supermarket chains, they now have to contend with a new control label cola that is trying to steal their hip, teen-badge positioning.Last month, Ottawa-based Loeb introduced Loeb Cola and...

As if Coke and Pepsi do not have enough troubles with the supermarket chains, they now have to contend with a new control label cola that is trying to steal their hip, teen-badge positioning.

Last month, Ottawa-based Loeb introduced Loeb Cola and Loeb Diet Cola with English and French ad campaigns in Ontario and Quebec.

Loeb has 130 franchised food stores across Ontario and in northern and western Quebec.

The creative, developed by Ottawa agency Hewson Bridge and Smith, features the theme line ‘Dare to Diff,’ which is intended to position the Loeb product as a counter-cola for people tired of status brands and marketing hype.

The campaign, which began May 17 and ran for a period of four weeks, included tv, newspaper, magazine, interior and exterior transit and outdoor.

Hewson Bridge President Don Hewson says the goal of the launch program was to encourage teens to go against convention and choose Loeb Cola instead of one of the traditional colas.

The spokesperson in the tv spot (different actors were used for the English and French executions) is a charismatic, school-age male, who could not care less what the makers of the traditional colas have to say: he prefers the taste of Loeb Cola.

Hewson says evidence of the tv spot’s success comes in the form of reports of high school students imitating the lead actor and repeating lines from the ad.

David Guilfoyle, Loeb’s senior vice-president of marketing services, declines to reveal specific sales data, but says Loeb Cola and Loeb Diet Cola have performed ‘extremely well’ since their launch.

Among the top-performing control label colas is President’s Choice, which accounts for up to 64% of total cola sales in Loblaws stores.

Guilfoyle says he believes the counter-cola positioning is appropriate in today’s market, explaining ‘people in the 1990s are not hung up on brand and don’t want to get taken.’

Loeb Cola sells for $4.99 for a case of 24 cans, one to two dollars cheaper than the mainstream brands.

According to Guilfoyle, Loeb conducted comparative tastes between the new Loeb colas and the national brands, and the Loeb products ‘either fared more favorably or were even with Coke, Diet Coke, Pepsi and Diet Pepsi.’

Interestingly, Guilfoyle notes that when he began investigating the control label cola category in 1992, he had no intention of going toe-to-toe with the titans of the cola industry.

‘Our strategy is to support national brands,’ he says.

But Guilfoyle says Coca-Cola and Pepsi-Cola were unhelpful when he explained his need for an inexpensive cola to compete with rival supermarkets already selling their own house brand colas.

Supermarkets with control label colas regularly advertise the low cost of their colas with relation to the national brands in order to draw customers into their stores.

Guilfoyle says Coca-Cola and Pepsi-Cola effectively forced him to launch a house brand by refusing his request that they drop their prices into line with the control label brands sold by Loeb rivals.

Subsequently, he says he invited Coca-Cola to become Loeb’s control label supplier but was turned down.

Neither Coca-Cola nor Pepsi-Cola Canada returned phone calls requesting an interview on the subject of Loeb’s new colas.

Loeb also failed to connect with Toronto’s Cott Beverage, which produces nearly all the control label colas sold in Canada. Control label accounts for nearly 20% of total soft drink sales in Canada.

Guilfoyle says Cott was too demanding: ‘They want to go into the stores and tell you what you are going to charge and where you are going to display it.’

That approach did not sit well with Guilfoyle, whose attitude is ‘we own the stores and we make the marketing decisions.’

As well, Guilfoyle says he felt supply would be an issue with Cott, since the bottler would not guarantee Loeb priority on its production line.

‘If I go with Cott, where do I position myself on their manufacturing line? Third? Fourth? Fifth?’ he asks.

Loeb eventually signed a contract with a small Etobicoke, Ont. bottler, Northern Country Beverages, which makes Loeb its No. 1 client. PA