Cola firms switch India approach

25 September 2012

NEW DELHI: Coca-Cola and Pepsi are re-evaluating their approach to the Indian soft drinks market due to competition from established local rivals.

In recent months, both companies have revived brands they had previously discontinuedin order to better reflect local culture, the Economic Times reports. Previously, both companies had focused on selling their own global brands to consumers on the subcontinent.

Coke has re-introduced Citra, a lime drink it scrapped in favour of Sprite, and Rim Zim, a reformulated masala soda currently being trialled in Delhi and Punjab. Pepsi, meanwhile, has resuscitated 100-year-old Mumbai brand Duke's with three new flavours, and is piloting 7UP masala nimbu soda in Punjab.

"Local is the new national for brands," Smitha Sarma Ranganathan, a brand communication specialist from Bangalore, told the news source.

The global soft drinks firms' change in strategy is partly explained by the continued success of some Indian-owned cola brands.

In Gujarat, the family-run firm of Hajoori & Sons, whose marketing slogans include a 'Apna desh, apna drink' ('our country, our drink'), claims its Sosyo brand has a 30% share in the state, on a par with Pepsi and ahead of Coke.

"Cola MNCs tried their best to kill Sosyo but it has survived," said director Aliasgar Hajoori. But Pepsi dismissed the share of local beverage brands in Gujarat as being "miniscule".

In the north of the country, Campa Cola – slogan 'The Great Indian Taste' – is benefiting from the activities of Alankar Bottling, whose owner, Atul Agarwal, pointed to the brand's taste as the reason for its success, being less sweet than Coke or Pepsi.

Ramesh Chauhan, chairman of the bottled water company Parle Bisleri, was sceptical of the revival trend. He argued that increased health concerns mean that fruit juices and mineral waters are increasingly seen by consumers as being preferable to colas.

"They [cola brands] may create some buzz but the revival won't lead them anywhere," he said.

Data sourced from the Economic Times; additional content by Warc staff