It was the perfect battlefield. The enemy was there, the viewers had taken position, the ammunition was all ready, even the timing was right – a scorching summer. Only the two warriors refused to go to war. The sixth season of the Indian Premier League tournament with beverage maker PepsiCo India as the title sponsor would seem to have presented the perfect opportunity for Pepsi and its arch rival Coca-Cola to take digs at each other. After all, the ad war between the two is legendary with the two rivals brands known for their aggressive comparative advertising which poked fun at each other. But Pepsi has launched its marketing blitzkrieg at the start of the season sans any fireworks. Coke, in turn, seems to have given the tourney a cold shoulder and is quietly going about doing its own thing. So has the fizz gone?
The fizz is still there but it is now directed at the market instead of each other. In the last decade, as the market for aerated drinks matured, so did the manufacturers, who now prefer to concentrate on building the category. To start with, both the players are looking to reduce their dependency on the summer season, the peak season for their sales, so much so, that this year they began advertising as early as January. Coca-Cola India hit the first salvo with the launch of its brand campaign, ‘Crazy for happiness’.
“Over the years, we are observing that the seasonality curve for the beverage industry is tapering off and that has been a key focus area for us. We produce high quality, great tasting beverages across our portfolio that can be enjoyed throughout the year,” said Anupama Ahluwalia, vice president, marketing, Coca-Cola India.
Interestingly, it is only the northern parts of the country where sales dip in winter even as demand for aerated drinks remain high in the rest of the country, especially western and southern India. Keeping this in mind, Coca-Cola India in an unlikely move, rolled out the campaign for its mango drink, Maaza, in the winter months with Bollywood actor Imran Khan and actress Parineeta Chopra, with the tag line ‘Har mausam love, har mausam aam’.
Pepsi Co India, too jumped on the bandwagon and in January launched its ‘Oh Yes Abhi’ campaign featuring Bollywood actors such as Ranbir Kapoor and Priyanka Chopra apart from cricketer MS Dhoni, based on the global theme, ‘Live for now’, making certain changes to the core idea to suit the taste of Indian consumers. “As a category, we have discovered that the early start helps in building the advertising stock apart from being able to start recruiting consumers earlier and then when season comes in those consumers stay with the brand throughout the time,” said Deepika Warrier, vice-president, (beverages), marketing , PepsiCo India.
However, even as the market for aerated drinks has expanded, per capita consumption of aerated drinks in India still remains low at 20 bottles per person. According to Ahluwalia, this is a country which has one of the lowest per capita consumption levels for packaged beverages. “The per capita consumption of our products is only 12. Contrast this to a global average of 92, 38 in China and 728 in Mexico (till 2011),” she said. As per industry estimates the overall size of the carbonated drinks market in India is R14,000 crore. Of this, the cola segment is about R5,000 crore, while the lime and lemon drinks category is the largest at about R6500 crore. Orange based drinks bring up the rear at about R 2700 crore.
It is here that the rural market becomes all the more important. Both the players are looking at acquiring consumers in the tier 2 and 3 towns and are coming out with various marketing initiatives that talk to consumers there. For instance, as a run-up to its television commercial, ‘Aaj kuch toofani kartey hain’, for Thums Up, which ironically is the leader in its portfolio, Coca Cola has launched the fourth edition of its road show, Thums Up Jalsa, covering 400 towns and cities across the country. “Here the idea was to make the brand message inspirational. Through the campaign, we wanted to give the message that anybody can do ‘toofani’,” explained KV Sridhar, chief creative officer, India sub-continent, Leo Burnett.
Earlier this year, Coca-Cola launched the desi version of its campaign, ‘Crazy for Happiness’ at this year’s Kumbh Mela. Called ‘Khushiyon ka Sangam’, the campaign ran during the special broadcast of Kumbh Mela ceremonies on a dedicated channel accessed through mobile app NexGTV. “The content of Maha Kumbh jelled well with Coke’s happiness message and hence it associated with us for the channel in two levels, which include the pre-roll video ads and the preview screen branding,” said Jaskirat Singh Gill, vice-president, marketing, DigiVive, which owns NexGTV.
While Pepsi continues to speak to the urban youth of this country, the company has not ignored its consumers living in tier 2 and 3 cities. The beginning of the year saw the company launch a dance competition, ‘Dance on’ for its sparkling lemon based drink 7UP in south India across 13 cities in Karnataka, Tamil Nadu and Kerala. “We follow a hub and spoke model in the rural areas, where we appoint large distributors who have hubs and then they reach out to villages. The idea is to widen our reach as much as possible. This is further supported with several activations so that the brand constantly remains in the mind of consumers,” added Warrier.
Warrier goes on to say that Pepsi has realised that one format will not help the category grow; therefore it has segregated the country into “go-to” markets based on consumers and tiers. “For example, we have premiere go-to markets comprising metros which have more consumers from the upper socio-economic categories. Similarly, we have core go-to markets which comprises the bulk of the demand for our fizzy drinks as well as hydration. Then we have rural value go-to markets.”
As the rural market becomes the hotspot, issues such as expanding the distribution network, penetration, building cold chains, etc., are gaining prominence. As much as $700 million to $1 billion is spent every year on expanding the distribution network by the two players. Coke today reaches 2.2 million outlets in the country and is targeting 2.4 million outlets.
With soft drinks best served chilled, maintaining the cold chain even in remote areas where power outages are common becomes a challenge. Both the players are coming out with innovative solutions to tackle this. For instance, Coca Cola India has introduced eKOcool coolers apart from installing eutectic coolers. These coolers come with brine solution that keeps the product chilled even if there is no electricity supply for more than 12 hours. Pepsi Co India recently introduced a powder version of its Tropicana fruit juice in sachets across India, a move that will help the company to tap its rural consumers who have so far stayed away from the premium juice brand.
“The rural market in India poses several challenges to beverage companies in terms of expanding their footprint, one of which is the availability of chilled products. One of the biggest challenges in rural market is getting more people introduced to consuming beverages in a ready to drink packaged form. So at some of the other places the focus is on placing ice boxes along with tie-ups with ice manufacturers so that ice is available to our retailers even during peak summers,” said Ahluwalia.
Innovative packaging in the form of non standard pack sizes is also helping the category to reach out to the consumer and convince her to sample the product more often. “Aerated drinks were earlier available mostly in returnable glass format and hence the category was driven by impulse buying. With the introduction of take home formats of packaging and the availability of several pack sizes, itis easy for the consumer to select what he wants to drink, which has also enabled the category to grow,” explained Warrier. For example, 7UP, the clear drink from Pepsi Co India’s stable is available in various pack sizes of 330 ml can, 250ml slim can, 200 ml and 300 ml returnable glass bottles (RGB) apart from 500 ml, 600 ml, 1 litre, 2 litre and 2.25 litre PET bottles. Coca-Cola last year introduced a Rs 8 price point for its 200 ml Coke RGB, which was earlier available for R10.
Again, Pepsi has launched a new bottle called, ‘mango- inside- mango-outside bottle’ for Slice. The bottle reflects the texture of that of a diced mango. “We have been strategically very consistent with Slice. Every year we unearth one insight on mango and we present it as, ‘this is slice’s take on mango indulgence’. So two years ago it was about waiting, while last year was about ‘aab ras baresga’. Our research has told us that Slice’s taste is a big winner, and consumers feel that other mango drinks are tasteless. They told us “uske samne other drinks are pheeka” which we converted it into a campaign,” added Warrier.
The changing market dynamics has found its reflection in the communications that the two brands have been coming out. Prasoon Joshi, chairman and chief creative officer, McCann Worldgroup India and president, South Asia, who has been associated with brand Coke for more than a decade, said that the consumer is living in a cluttered environment and is also spoilt for choice, so it is difficult to find her share of mind. “Therefore one needs ideas that are infectious and has a natural ability to withstand. As a brand you are successful when advertising becomes a part of consumer’s life,” added Joshi.
Pepsi’s Warrier says that the brand takes a long term view while determining its advertising strategy for which it has a three-year plan, and a short term one for which it prepares a one-year plan. “The one year-plan also includes goals such as distribution, penetration, per capita growth, market share, etc. Also we have to ensure that our advertising and marketing campaign is relevant and contextual to the times. For example, last year we saw a lot of consumer fatigue coming into cricket, so we changed it into football.”
“Usually beverage makers spend 15% of their annual turnover on advertising. It is an advertising led category, therefore these companies look for properties such as the IPL or cricket world cup, which will provide ample opportunities for display and sampling of their respective brands,” said Ramanujam Sridhar, CEO, Brand-com.
Over the years, the two players have built a portfolio of drinks which cater to the needs of consumers across all age groups. Soft drinks today are available in over 2.15 million outlets across the country, nearly a third of all the shops in the country. Three years ago, these were available in only 1.5 million shops. That, perhaps, says it all.
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The fizz is still there but it is now directed at the market instead of each other. In the last decade, as the market for aerated drinks matured, so did the manufacturers, who now prefer to concentrate on building the category. To start with, both the players are looking to reduce their dependency on the summer season, the peak season for their sales, so much so, that this year they began advertising as early as January. Coca-Cola India hit the first salvo with the launch of its brand campaign, ‘Crazy for happiness’.
“Over the years, we are observing that the seasonality curve for the beverage industry is tapering off and that has been a key focus area for us. We produce high quality, great tasting beverages across our portfolio that can be enjoyed throughout the year,” said Anupama Ahluwalia, vice president, marketing, Coca-Cola India.
Interestingly, it is only the northern parts of the country where sales dip in winter even as demand for aerated drinks remain high in the rest of the country, especially western and southern India. Keeping this in mind, Coca-Cola India in an unlikely move, rolled out the campaign for its mango drink, Maaza, in the winter months with Bollywood actor Imran Khan and actress Parineeta Chopra, with the tag line ‘Har mausam love, har mausam aam’.
Pepsi Co India, too jumped on the bandwagon and in January launched its ‘Oh Yes Abhi’ campaign featuring Bollywood actors such as Ranbir Kapoor and Priyanka Chopra apart from cricketer MS Dhoni, based on the global theme, ‘Live for now’, making certain changes to the core idea to suit the taste of Indian consumers. “As a category, we have discovered that the early start helps in building the advertising stock apart from being able to start recruiting consumers earlier and then when season comes in those consumers stay with the brand throughout the time,” said Deepika Warrier, vice-president, (beverages), marketing , PepsiCo India.
However, even as the market for aerated drinks has expanded, per capita consumption of aerated drinks in India still remains low at 20 bottles per person. According to Ahluwalia, this is a country which has one of the lowest per capita consumption levels for packaged beverages. “The per capita consumption of our products is only 12. Contrast this to a global average of 92, 38 in China and 728 in Mexico (till 2011),” she said. As per industry estimates the overall size of the carbonated drinks market in India is R14,000 crore. Of this, the cola segment is about R5,000 crore, while the lime and lemon drinks category is the largest at about R6500 crore. Orange based drinks bring up the rear at about R 2700 crore.
It is here that the rural market becomes all the more important. Both the players are looking at acquiring consumers in the tier 2 and 3 towns and are coming out with various marketing initiatives that talk to consumers there. For instance, as a run-up to its television commercial, ‘Aaj kuch toofani kartey hain’, for Thums Up, which ironically is the leader in its portfolio, Coca Cola has launched the fourth edition of its road show, Thums Up Jalsa, covering 400 towns and cities across the country. “Here the idea was to make the brand message inspirational. Through the campaign, we wanted to give the message that anybody can do ‘toofani’,” explained KV Sridhar, chief creative officer, India sub-continent, Leo Burnett.
Earlier this year, Coca-Cola launched the desi version of its campaign, ‘Crazy for Happiness’ at this year’s Kumbh Mela. Called ‘Khushiyon ka Sangam’, the campaign ran during the special broadcast of Kumbh Mela ceremonies on a dedicated channel accessed through mobile app NexGTV. “The content of Maha Kumbh jelled well with Coke’s happiness message and hence it associated with us for the channel in two levels, which include the pre-roll video ads and the preview screen branding,” said Jaskirat Singh Gill, vice-president, marketing, DigiVive, which owns NexGTV.
While Pepsi continues to speak to the urban youth of this country, the company has not ignored its consumers living in tier 2 and 3 cities. The beginning of the year saw the company launch a dance competition, ‘Dance on’ for its sparkling lemon based drink 7UP in south India across 13 cities in Karnataka, Tamil Nadu and Kerala. “We follow a hub and spoke model in the rural areas, where we appoint large distributors who have hubs and then they reach out to villages. The idea is to widen our reach as much as possible. This is further supported with several activations so that the brand constantly remains in the mind of consumers,” added Warrier.
Warrier goes on to say that Pepsi has realised that one format will not help the category grow; therefore it has segregated the country into “go-to” markets based on consumers and tiers. “For example, we have premiere go-to markets comprising metros which have more consumers from the upper socio-economic categories. Similarly, we have core go-to markets which comprises the bulk of the demand for our fizzy drinks as well as hydration. Then we have rural value go-to markets.”
As the rural market becomes the hotspot, issues such as expanding the distribution network, penetration, building cold chains, etc., are gaining prominence. As much as $700 million to $1 billion is spent every year on expanding the distribution network by the two players. Coke today reaches 2.2 million outlets in the country and is targeting 2.4 million outlets.
With soft drinks best served chilled, maintaining the cold chain even in remote areas where power outages are common becomes a challenge. Both the players are coming out with innovative solutions to tackle this. For instance, Coca Cola India has introduced eKOcool coolers apart from installing eutectic coolers. These coolers come with brine solution that keeps the product chilled even if there is no electricity supply for more than 12 hours. Pepsi Co India recently introduced a powder version of its Tropicana fruit juice in sachets across India, a move that will help the company to tap its rural consumers who have so far stayed away from the premium juice brand.
“The rural market in India poses several challenges to beverage companies in terms of expanding their footprint, one of which is the availability of chilled products. One of the biggest challenges in rural market is getting more people introduced to consuming beverages in a ready to drink packaged form. So at some of the other places the focus is on placing ice boxes along with tie-ups with ice manufacturers so that ice is available to our retailers even during peak summers,” said Ahluwalia.
Innovative packaging in the form of non standard pack sizes is also helping the category to reach out to the consumer and convince her to sample the product more often. “Aerated drinks were earlier available mostly in returnable glass format and hence the category was driven by impulse buying. With the introduction of take home formats of packaging and the availability of several pack sizes, itis easy for the consumer to select what he wants to drink, which has also enabled the category to grow,” explained Warrier. For example, 7UP, the clear drink from Pepsi Co India’s stable is available in various pack sizes of 330 ml can, 250ml slim can, 200 ml and 300 ml returnable glass bottles (RGB) apart from 500 ml, 600 ml, 1 litre, 2 litre and 2.25 litre PET bottles. Coca-Cola last year introduced a Rs 8 price point for its 200 ml Coke RGB, which was earlier available for R10.
Again, Pepsi has launched a new bottle called, ‘mango- inside- mango-outside bottle’ for Slice. The bottle reflects the texture of that of a diced mango. “We have been strategically very consistent with Slice. Every year we unearth one insight on mango and we present it as, ‘this is slice’s take on mango indulgence’. So two years ago it was about waiting, while last year was about ‘aab ras baresga’. Our research has told us that Slice’s taste is a big winner, and consumers feel that other mango drinks are tasteless. They told us “uske samne other drinks are pheeka” which we converted it into a campaign,” added Warrier.
The changing market dynamics has found its reflection in the communications that the two brands have been coming out. Prasoon Joshi, chairman and chief creative officer, McCann Worldgroup India and president, South Asia, who has been associated with brand Coke for more than a decade, said that the consumer is living in a cluttered environment and is also spoilt for choice, so it is difficult to find her share of mind. “Therefore one needs ideas that are infectious and has a natural ability to withstand. As a brand you are successful when advertising becomes a part of consumer’s life,” added Joshi.
Pepsi’s Warrier says that the brand takes a long term view while determining its advertising strategy for which it has a three-year plan, and a short term one for which it prepares a one-year plan. “The one year-plan also includes goals such as distribution, penetration, per capita growth, market share, etc. Also we have to ensure that our advertising and marketing campaign is relevant and contextual to the times. For example, last year we saw a lot of consumer fatigue coming into cricket, so we changed it into football.”
“Usually beverage makers spend 15% of their annual turnover on advertising. It is an advertising led category, therefore these companies look for properties such as the IPL or cricket world cup, which will provide ample opportunities for display and sampling of their respective brands,” said Ramanujam Sridhar, CEO, Brand-com.
Over the years, the two players have built a portfolio of drinks which cater to the needs of consumers across all age groups. Soft drinks today are available in over 2.15 million outlets across the country, nearly a third of all the shops in the country. Three years ago, these were available in only 1.5 million shops. That, perhaps, says it all.
Read my blogs @ http://www.brand-comm.com/blog.html
Facebook: facebook.com/RamanujamSridhar
Twitter: twitter.com/RamanujamSri
1 comment:
Sir I feel PepsiCo is leading the Cola-war. your write up on the warfare strategies by both Cola companies is laudable. Please see the link below to find out why PepsiCo may actually be the winner
http://avalakki.blogspot.in/2013/04/pepsi-atom-pepsi-has-done-its-home-work.html
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