Cincinnati Reds go for Coke

Coke is Seeing Red

No, I am not talking about the financial stability of the beverage giant, but the new five year deal that the company has signed with the Cincinnati Reds to have the exclusive beverage rights at the Great American Ball Park. This entitlement, which was previously held by Pepsi Co., will give Coke the exclusive rights to sell soft drinks, juices, water and energy drinks at the ballpark.

Coca-Cola Sign in Downtown Atlanta

Red Strings Attached

Along with being able to serve those drinks Coca-Cola also receives pass-through rights for restaurants and retail partners to give away vouchers to Reds games, is planning on starting a recycling campaign at the Great American Ball Park as well as having a signature Coke ribbon on top of the new scoreboard and a full suite at the stadium.
While no price-points were released, rumors have it that it was a low seven-figure per year deal.

Marketing Opportunities Galore

I think this is another great opportunity for the Atlanta based Coca-Cola Company to market itself, especially in the Northern part of the United States, which historically preferred Pepsi. Also, I think that “Reds” and the red Coke bottle put together will bring some obvious marketing potential for print, radio and T.V. ads. As far as economics go, this is first and foremost a double win for Coke against its biggest rival. First, Coke gained a stadium. Second, Pepsi lost one. Having exclusive rights at any arena creates brand presence, and widely televised events, such as Major League Baseball games, will give Coke a ton of “free” and subliminal advertising, not to mention the marketing and sale increase possibilities that accompany such commitments. Will this significantly increase the value of Coke’s stock (NYSE: KO)? Will it bring in billions of revenue? Probably not, but it will most likely look positive for the investors and hopefully bring in enough revenue to break even, but even if no economic changes take place, it gets more people drinking Coke, and what company would complain about that?