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Hopes to Revive Brand's Sagging Sales

By Published on .

BOSTON (AdAge.com) -- Coca-Cola Co. said today it is confident a new advertising initiative for Sprite will boost sales for the sluggish soft-drink brand.

Three new spots from WPP Group's Ogilvy & Mather Worldwide, New York, will carry the question "What's your thirst?" -- echoing the campaign's longtime theme, "Obey your thirst."

Sprite is the company's No. 2 soft drink, and pressure has been mounting for Ogilvy to come up with a winning ad concept as Sprite's volume has been on the wane. Supermarket sales were down 5.8% in the year-to-date period ended June 15, according to industry publication Beverage Digest, a drop that is greater than the lemon-lime-flavored segment's sales decline of 3.3%

Rival gains ground
Sales of PepsiCo's

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Sierra Mist, a rival to Sprite, rose 1.9%, and Sprite is expected to come under even more pressure as PepsiCo rolls out Sierra Mist nationally next year.

Coca-Cola executives today said innovation should boost the brand, as line extensions such as Vanilla Coke and Diet Coke with Lemon have done with its flagship drink, Coke. It also plans to work with bottlers to beef up point-of-purchase and other promotional materials that appeal to retailers.

The advertising "will start to put the advertising energy behind the brand that is so central to its growth," Jeff Dunn, Coca-Cola's president and chief operating officer, told analysts during a conference call. "Innovation is a clear driver in the [carbonated soft drink category]."

Net income up 15%
For the three months ended June 30, Coca-Cola's net income rose 15% to $1.3 billion from $1.1 billion.

North America, the beverage giant's largest market, saw growth of 4% on a year-to-date basis, led by carbonated and non-carbonted beverages, specifically Dasani bottled water and Powerade sports drink. Coca-Cola recently relaunched Powerade to better compete with category leader Gatorade, also from PepsiCo.

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