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Coke Finally Pulls the Plug on Tab as Part of a Sweeping Portfolio Restructuring

coke-finally-pulls-the-plug-on-tab-as-part-of-a-sweeping-portfolio-restructuring

In the early years, fans joked that Tab stood for “Totally Artificial Beverage,” a reference to its sugar substitute and lingering aftertaste.
Kacy Burdette for Adweek

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By Robert Klara

3 hours ago

The National Society of Tab Appreciators—if there is one—had better get to the grocery store fast: Coca-Cola announced today that the 57-year old brand that pioneered America’s diet soft drink sector will be retired by year’s end.

The beverage giant also announced that several other “select underperforming products” will take their final bow this year—including Diet Coke Feisty Cherry, Coca-Cola Life, Sprite Lymonade and regional brands like Delaware Punch. Odwalla, the fruit-juice brand that Coke bought in 2001 for $181 million and whose dissolution Coke revealed this summer, will also be gone by year’s end.

Coca-Cola hinted that an overhaul was coming when it released its second-quarter earnings in July. It referenced “strategic actions that are positioning the system to emerge stronger from the ongoing coronavirus pandemic,” actions that included “prioritizing brands best positioned for consumer reach and share advantage.”

In this morning’s announcement, Coke’s global head of innovation and marketing operations Cath Coetzer insisted that the portfolio reduction “isn’t about paring down to a specific number of product offerings under our brands. The objective is to drive impact and growth. It’s about continuing to follow the consumer and being very intentional in deciding which of our brands are most deserving of our investments and resources, and also taking the tough but important steps to identify those products that are losing relevance and therefore should exit the portfolio.”

Coke’s net revenues were down by 28% for the second quarter, to $7.2 billion. The company will announce its Q3 earnings on October 22.

Tab wasn’t America’s first diet cola (that honor rests with Diet Rite, which Royal Crown introduced in 1961), but it was the first diet cola that caught the attention of an increasingly calorie-conscious postwar America, made up largely of female consumers. Tab’s early marketing directed itself toward women anxious about staying attractive, and sales of the drink—initially sweetened with saccharin—rose accordingly. Tab pretty much ruled the diet-cola category until the R&D department rolled out Diet Coke in 1982. Aspartame, its sweetening ingredient, left drinkers with less of an aftertaste than saccharin had, and Tab’s market share fell like a stone.

Coke kept Tab on life support, despite the dismal figures. (In 2017, Tab’s sales made up a virtually undectible .03% of Coke’s total take.) Its demise is something that fans have been more or less expecting for many years.

Even so, the news will hit Tab fans hard. Among them is Federal Communications Commission chairman Ajit Pai, who tweeted this morning: “We’ve withstood so many of the difficulties and disruptions that 2020 has thrown our way, but this is a really big blow.”


The fans. The brands. Social justice. The future of sports. Don’t miss the upcoming Brandweek Sports Marketing Summit and Upfronts, a live virtual experience on Nov. 16-19. Early-bird passes available until Oct. 26. Register now

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