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Coke, Pepsi track regional rivals

News, 08 February 2017

NEW DELHI: Coca-Cola and Pepsi are reported to have set up separate groups within their organisations to monitor India's regional soft drinks brands that command a significant share and which some believe are behind a planned boycott of the multinationals' products in Tamil Nadu.

"The teams looking at these brands are separate from the ones tracking rural markets or counterfeits," an official from one of the cola companies told the Economic Times.

The newspaper reported that there are "at least 50" regional carbonated drinks brands that typically cost 20% less than international brands and which between them command a 15-17% share of the market.

Both Coca-Cola and Pepsi declined to comment on the specific suggestion that they had created new teams in the face of this threat.

A Coca-Cola spokesperson merely noted that "We stay informed of new products, new brands and emerging consumer preferences" while Pepsi's response was that "We have sharpened our communication based on insights we glean from consumer interactions".

Both brands have become central to a multi-layered protest that has taken off in Tamil Nadu, with objections being raised around their impact on water consumption, children's health and local culture.

In a state facing a severe drought and in dispute with its neighbours over the release of water from the Cauvery River, protesters have objected to the exploitation of ground water resources by the brands' bottling plants.

And when a recent Coca-Cola print ad carried the rider "not recommended for children" – a mandatory disclaimer for products containing artificial sweetener – many outlets were quick to stop stocking Coke and Pepsi products.

The third strand of opposition is the support Coke and Pepsi have given PETA, the animal rights charity that wants to see an end to Jallikattu, the traditional sport of bull taming in which a local breed of bull is released into an arena and contestants try to hang onto its hump for as long as possible.

One strand of thought is that this is an attempt by global brands to kill off native cattle breeds and create space in the market for their own dairy-based products.

The largest traders' body in the state has now called for a boycott of Coca-Cola and Pepsi products from the beginning of March, a stance that one commentator dismissed as "retail jingoism".

Data sourced from Economic Times, Business Standard; additional content by Warc staff