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How a Beverage
Manufacturer Leveraged Portfolio Changes to Grow Volume and Revenue

 

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+2.9%

Total Volume Increase

+6.9%

Total Revenue Increase

Achieved by introducing a new product and despite cannibalization.

Future-proofing RGM with AI

Background

PPA Mix    |    iconscasestudyanon03  Beverages  |   iconscasestudyanon02 >40b |  iconscasestudyanon01 Global

 

This global beverage company has firmly established itself as a leader in the soft drinks industry. Its iconic product portfolio has become a household staple for millions worldwide, with categories ranging from carbonated soft drinks, juices, water, and hydration beverages to ready-to-drink teas and coffees.

This prominence is reflected in the company’s impressive financial performance, with net revenues exceeding $40 billion in recent years.

Challenges

To maximize revenue potential and increase market share, the manufacturer was considering making portfolio changes across one of its core lines.


Holistic portfolio view

Need for a holistic view across SKU, portfolio, and category.

 


Revenue growth pressure

Pressure to grow revenue and market share through portfolio changes.

 

Approach

The manufacturer sought to assess how altering the pack size of its soft drinks would influence revenue and sales volume.

To achieve this, they identified two key strategies for testing.

Their analysis focused not only on their own brand, but also on competitors, evaluating the impact across category, portfolio, and SKU levels.

Tested Strategies

1. Making product changes

Strategies Tested

  • Product change: Replacing Brand A’s (1.5L) and Brand B’s (1.5L) 6-bottle pack with a 4-bottle pack.
  • Price change: A 33% reduction to maintain a consistent price per liters. 

 

Results

The tested product change scenario is expected to drive volume and revenue growth for Brand A and Brand B.

However, at the portfolio level, the changes would lead to:
  • 0.7% decline in total volume due to the cannibalization of other products
  • 0.6% decrease in total revenue, despite gains for Brand A and Brand B and a stable price per liter.

 

2. Introducing a new product

Strategies Tested

  • Product change: Introducing a new product, a 2-bottle pack for Brand A, Brand B, and Brand C, and keeping the 6 bottle pack as is.
  • Distribution change: Setting distribution as 60% of the 6-bottle pack.

 

Results

The introduction of a new 2-bottle pack alongside the existing 6-bottle pack is expected to drive overall growth.

  • 2.9% total volume growth
  • 6.9% revenue growth despite cannibalization

 

Results

With the Buynomics software, the RGM team was able to model product and portfolio changes, pricing, and distribution holistically.

They were able to benchmark their performances and make decisions with a full understanding of the impact that their changes will have on their volume and revenue across product, portfolio, and category levels.

+2.9%

Total volume increase

 

+6.9%

Total revenue increase

 

Achieved by introducing a new product and despite cannibalization.

Make better RGM decisions, faster!

Run agent-based simulations with Buynomics’ Virtual Shoppers AI to optimize all revenue levers, capturing cross-effects, cannibalization, and competition.

2-4%

Profit impact*

95%

Predictive Accuracy*

80%

Faster Decision-making

*Depending on data quality and completeness