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Milk, juice competition grows in India

News, 05 April 2016

NEW DELHI: The cola wars are losing their intensity as India's soft drinks giants engage on new battlefields, with dairy and fruit juices emerging as priorities for product innovation and advertising investment as consumers increasingly seek healthier options.

Earlier this year Coca-Cola, for example, launched VIO, its first ready-to-drink flavoured milk product in India. "We expect VIO to set the trend in making out-of-home, on-the-go milk consumption in vogue for consumers for different age groups across the social strata," a spokesperson said.

The Business Standard observed that the launch had not been accompanied by a major advertising push, but with a distribution strategy focused on modern retail outlets, the brand's communications have so far been geared towards digital marketing and in-store promotions.

"We aim to build higher brand recall and awareness," the spokesperson said. "This will be followed by a strong communication plan which includes digital and print campaigns."

Observers noted that Coca-Cola's increasing presence in this sector and the marketing investment it commands would boost consumer awareness and demand for the category, which is currently growing at around 25% a year and could become a $1bn market within five years.

In fruit juices, meanwhile, mango is rapidly becoming the focus of attention. Coca-Cola has announced its intention of more than doubling sales of Maaza, its mango-based drink, which it says has been tried by only 20% of the population.

And Parle Agro, which last year rebranded Frooti, its flagship mango drink, intends to back its push into new areas over the coming year.

"We will spend about Rs 150 crore this year of which about Rs 70 crore will be on expanding our brand presence and distribution in more rural markets, while about Rs 80 crore will go towards advertising," according to Nadia Chauhan, Parle Agro's Joint MD and chief marketing officer.

Parle Agro is also planning further investment in Appy, its apple drink.

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