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Coke & Pepsi Compete in India


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Coke & Pepsi Compete in India

  1. 1. COKE AND PESSI LEARN TO COMPETE IN INDIA International Marketing Cources MS:
  2. 2. TEAM MEMBERS 1. 2. 3. 4. 5. Võ Vương Huy Nguyễn Việt Hạnh Duyên Phạm Thành Nam Đinh Nguyễn Quỳnh Trang Nguyễn Đức Hoài Duy
  3. 3. OUTLINE 1. Introduction • Political Environment & India’s Market 2. Promotion Mix • Product • Promotion • Place • Price 3.Glocalization Strategy . 4.Lessons
  5. 5. Political Environment • In 1991, an economic crisis: oil prices rise → inflation → A new government. • “The principle of indigenous availability” => India seen as unfriendly to foreign investorfor many years. • The Liberalization of India’s government in 1991 + the dismantling of strict trade rules and regulations → foreign inTvestment increased Introduced the new plan to help economy • In 1988, BVO
  6. 6. INDIA MARKET • Coke entered the Indian market from 1958 to 1977; give up 40 % equity stake + hand over its secret syrup formula or leave India → leave • Six favorite drinks: cola, cloudy lemon, orange, soda, mango and clear lemon • Indian consumers prefer to fruit drinks (natural, healthy, tasty) → carbonated soft drinks > < noncarbonated fruit drinks → Parle’s Frooti • Average Indian buys 3 bottles of soda a year • PepsiCo entered the Indian market in 1986 as Pepsi Foods Ltd. In a joint venture with two local partner • Coca-Cola tried to reenter India by merging with a local company Godrej → rejected → made its return by merging with Britannia Industries India Ltd. • In July 1993, Parle sold bottling plants + leading brands to CocaCola
  7. 7. 2 MARKETING MIX Product -Promotion- Price-Place
  8. 8.  Pepsi Product • A big competitor of colacola • Concentrate much on Juices/juice drinks and water • Developing 7 food brands and 10 Beverages brands  CoCa-Cola Coca-Cola is the company which has introduced 6 types of soft drinks in the Indian market: -Soft drinks -Sports drinks -Energy drinks - Water -Juices/juice drinks -Energy drinks -Tea and coffee  Coca cola’s product is highly diversified in the India market with more than 70 brand names in Indian market
  9. 9. • Pepsi and Coke command over 95% of the soft-drink market in India. • In 1995, Coke had 52 % of the Indian softdrink market share and Pepsi had around 42% market share.
  10. 10. Compititors Local producers like Rc Cola, Alfa, Campa Cola, Red Bull
  11. 11. Price  Coca-Cola • Coca cola India (CCI) thought about the affordability of the market when CCI targeted the rural market of India. • CCI reduced price of soft drink by 15% 25% nationwide in order to encourage consumption  Pepsi • Direct Price Discrimination • Indirect Price Discrimination • Pepsi again decides it price on the basis of competition. • very flexible • this risk taking attitude has also earned
  12. 12. Promotion • Attracted young generation. • Choose the image of football player and cricketers. • Different size of bottles offered at lower prices • Has become the largest seller of soft drinks in India and is slowly forming a monopoly in drinks market.
  13. 13. PROMOTION • • • • Advertising: Sale Promotion: Personal Selling: Public Relation:
  14. 14. Advertising • Coke’s advertising and promotion strategy pulled the marketing plan together using local language and idiomatic expressions. • Coke invited brand ambassadors to promote their product. Customers who are familiar with the celebrities can quickly identify them with the product.
  15. 15. INDIA A • The urban youth target market, includes 18– 24 year olds in major metropolitan areas. Coca-Cola’s India strategy focused on relevant local idioms in an effort to build a “connection with the youth market. “Bombay Dreams” “Chennai Dreams” 60-second films featured actor Vivek Oberoi with Aishwarya Rai
  16. 16. INDIA B Coca-Cola India worked hard to build a brand preference among young people in rural target markets. • “Thanda Matlab Coca-Cola” - The campaign equates Coke with "thanda”, the Hindi word for • "cold," a commonly used term for a generic soft drink. This campaign successfully propelled • Coke into the number three position in rural markets.
  17. 17. Sale Promotion          Buy-one-get-one- free Customer Relationship Management New Media Merchandising Free gifts Discounted prices Joint promotion Free example Vouchers and coupons
  18. 18. Coca-cola: Doing sponsorship with some university and college’s study and other curriculum activities. Pepsi: Supporting for Cricket and football
  19. 19. Public Relation • • • • Advertising in many channels in india Using celebrities to advertise the product Many distribution channels Subsidies for many charity and social events in india • Pepsi: game shows, football events, HIV campaign • Coke: Education Built a strong image and good relationship with customer.
  20. 20. Place Coca-Cola products are available in: 1. Retail Stores including Convenient stores (Super markets etc…) 2. Vending machine/Self Service Slot machines (college, universities and other miscellaneous business) 3. Ho-Re-Ca (means Hotels, Restaurants, Cafes including Fast food outlets, cuisine Restaurants etc.)
  21. 21. Place • Locations where the product is consumed onsite can be split into small venues and large venues • ventured into ownership of fast food chains with its purchase of Taco Bell, Pizza Hut and KFC.
  22. 22. Coke & Pessi ‘s Glocalization Strategies
  23. 23. Coke & Pessi ‘s Glocalization Strategies Pessi • Pessi entered the Indian market in a joiny venture with 2 local partners , ( Vltas and Punjab Argro ) under the name “ Pessi Food Ltd “ • In keeping with local tastes , Pessi launched Lehar 7UP in the clear lemon category • Promoting the advertiment through the festival of Navrartri . • Pessi has been sponsoring famous Indian athletes for the World Cup Cricket series , and socer Tourament .
  24. 24. CoCa-Cola • Formed a joint venture with the market leader Parle in 1993 • Try to involve the masses through 20,000 free passes of “Thums Up” bottles . • Run special promotion to where one can win a free trip to Goa , a tourist and resort state in western . • Coke also hired some famous “Bollywood” actor to endorse their product
  25. 25. PROBLEMS • Coke & Pessi’s Products Contained significant levels of pesticide residue …. ?
  26. 26. Coke or Pessi in the long term prospects for success ?? Pessi: +Better marketing and advertising strategies +More widely accepted +More market share Coke : +Government conflicted +Trailing pessi in market share  Pessi will be better in the long term prospects for success
  27. 27. LESSONS • How transfer learning from one market to another, particularly Big Emerging Markets • Relationship building at all levels especially the government • How to devise strategies to target the future for global companies worldwide : the billions of the people of the bottom-of-the-pyramid (BOP) should be an opportunity and an important lesson. • Politically unstable countries → Having a good exit strategy. Ex: Coca-Cola’s exit in 1977 from India