About the Case
This case is about the initiatives taken by the Cola
major Coca- Cola in India.
This case discusses the detail of the Distribution,
Pricing & Advertising strategies taken up by the CCI
(Coca-Cola India) to be successful in Rural India.
The case also Focuses on the Cola War from the Urban
market to the Rural Market.
In 1993- 1999
Coca-Cola reentered in India
through a strategic alliance with
CCI had three CEO’s
1. Jaydev Raja – In 1993
2. Richard Nicholas – In 1995
3. Donald Short- In 1997
• Alex Von Behr Became the CEO.
• Company also increased the ad
spend on the acquired brands like
Thums up, Limca & Maaza.
Behr focused on rural
marketing & decided to
diversify into the bottled
water & powered soft drink in
association with the Kinley &
CCI announced its Maiden
profits from its Indian
CCI made an additional
Investment of Rs. 7 million ( 5
million from the company & 2
million from the company’s
CCI added 25 production lines
& doubled it glass & PET
Increment in rural
distribution by covering
1,58,342 villages in Aug 2003 &
in 2001 it was 81,383 villages
Thanda Goes Rural
In early 2002, Coca- Cola India launched a new advertisement campaign
featuring leading bollywood actor -Amir Khan .
The advertisement “Thanda matlab Coca-Cola” was launched to support
CCI’s rural market initiatives.
CCI launched three commercials with tagline Thanda matlab Coca- Cola
in which Aamir Khan featured as “ Tapori”, “Hyderabadi shopkeeper” & as a
Thanda Goes Rural
The poor rural infrastructure & consumption habits are the
two major obstacles to crack the rural market.
Shortage of power supply became a problem for CCI in rural
marketing because of which people prefer more of “ Lassi” &
CCI’s Rural Marketing Strategy
The Strategy was based on three “A”
• CCI emphasized on the availability of the product to the
• It focuses on strengthening its distribution network in Rural
• CCI realized that its centralized distribution system, which
was used for Urban areas will not be suitable for Rural areas.
• The company then opted for a Hub and spoke distribution
system for rural areas.
• It focuses on product pricing, In 2001 CCI revealed that 300
ml bottle were not popular in rural area.
• The price of Rs. 10/- per bottle was considered to high by
rural consumers. Therefore, CCI decided to make some
changes in size of its bottle & pricing to win over consumers
in rural market.
• In 2002 CCI launched 200 ml bottle (chota coke) priced at
R.5 to increase the rate of consumption in rural India.
• It focuses on convincing the customer to buy the product.
• To reach more rural consumers, CCI increased ad- spend by
hoardings in villages & painting the name Coca-Cola on the
compounds of the residences in the villages.
• In 2002 “ Chota Coke ” launched with a commercial featuring
bollywood actor “ Aamir Khan ”.
• In 2003, CCI strengthen the Coca-Cola brand image by
making coke a generic name for “ Thanda ” & launched print
advertisement in several regional newspapers.
• In year 2003, CCI had a target of reaching 0.1 Million more
• In early 2003, CCI announced that it was dropping plans to
venture into the beverage business.
• CCI planned to launch juice & milk based beverages such as
Nimbu paani, Fruit juice, Cold coffee & Ice tea in collaboration
Reasons to Enter into Rural
• Due to the vast size & large demand of the Indian rural
market, the FMCG companies have a great opportunities.
• Rural population is very large & It has grown richer in 1990’s,
with substantial improvements in incomes & spending power.
• Tax Exemptions for agriculture income have also contributed
to greater rural purchasing power.
Problems faced to sell the products
in Rural Market
Adversely affect the service &
the cost of the company
Promotion & Marketing Communication
Difficulty in understanding the social dynamics & attitude
variation with in each village
The CCI (Coca-Cola India) should target the colleges that
are situated in rural area to increase their market.
The CCI should also conduct some Street theatre as this is
deeply rooted in Indian culture.
CCI should make those advertisement which are related to
Weddings and traditional functions.