MINUTE MAID PARES PRICES

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Coca-Cola Foods, trying to put the brakes to falling sales for Minute Maid orange juice, is resorting to price cuts of 5% to 15%, even as ad spending soars.

Reduced wholesale prices, intended to deliver a lower everyday price to consumers, took effect about four weeks ago and mark "a major strategic change" for the $550 million brand, said Greg McCormick, director-Minute Maid marketing at Coca-Cola Foods. New pricing is just now showing up on store shelves, said John Clendening, VP-Minute Maid business team.

"We allowed our everyday price to get a little too high," Mr. McCormick said. He described Minute Maid's previous pricing and promotion plans as "very inefficient" and said the brand's new strategy involves a sig nificant reduction in promotional spending with the trade.

The price cuts come as Coca-Cola Foods claims it will more than double

ad spending for the brand this year to close to $25 million.

Minute Maid's total orange juice volume sales dropped 6.4% in gallons for

the first eight months of this year, vs. the year-ago period, according to

A.C. Nielsen Co. Its share declined to 22% from 23.7%. The $3 billion

category as a whole fared better during that period, with volume up 0.8%.

Minute Maid is lowering prices on all forms of orange juice after

suffering declines in all three segments-frozen concentrate, chilled/from

concentrate and chilled/non-concentrate. Minute Maid has long been

dominant in the frozen section, but market forces have been boosting the

prospects of the non-frozen segments. Minute Maid is hurting most in

chilled/non-concentrate, which is also the highest price-per-gallon

segment.

Recognizing the consumer trend toward ready-to-serve, Minute Maid had

previously taken steps to catch up there, including new ads and packaging,

and a variety of consumer and trade promotions. But it took its eye off

the major factor of price-remaining less flexible than competitors-and has

suffered as a result.

The losses reflect Minute Maid's own mistakes but also a fundamental

change in the

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