Coca-cola, once Indian left's bugbear as the epitome of the evil West out to destroy the nation's culture, is going extremely local with ethnic drinks based on age-old Indian household recipes, according to media reports.
The US giant is planning to enter the nascent Indian ethnic drinks market in an ambitious 'glocal' push as the market for sweetened fizzies seems to be on the decline amid increasing health awareness and lifestyle changes.
Coca-Cola is the maker of some of the world's most popular beverage brands including the Coke varieties of Coca-Cola Zero and Diet Coke. According to cocacolaindia.com, the other successful brands of the company include Thums Up, Fanta, Fanta Green Mango, Limca, Sprite, Sprite Zero, VIO Flavored Milk, Maaza, Minute Maid range of juices, Georgia and Georgia Gold range of hot and cold tea and coffee options, Kinley and Bonaqua packaged drinking water, Kinley Club Soda and BURN energy drink. The company boasts a network of over 2.6 million retail outlets.
The success of many local ethnic drinks brands point to the available market space for a well-marketed 'glocal' brand from a global giant, observers say. The demand for packaged versions of ethnic drinks has grown 32 percent over the last three years, three times the pace of carbonated beverages like Coke, according to Technopak Advisors, a New Delhi-based consultancy. Coke is rightly fishing in grandmas' recipe chest for ethnic alternatives.
"You have 29 states, which are virtually 29 countries. People speak different languages, have different food and beverage habits, have different motivations for consuming food and beverages," Bloomberg quoted T Krishnakumar, chief executive of Coke's business in India and Southwest Asia, as saying. Coke will essentially be playing catch up to companies like Bengaluru-based Hector Beverages, Mumbai-based Xotik Frujus, and Rajasthani Jayanti Group in this segment.
The Atlanta-based giant Coke will soon launch it cumin-seed flavored jaljeera across the country soon followed by aam panna drink this summer. The company may come out with dairy products like spiced buttermilk and lassi in 2020, Krishnakumar said.
"Years back, the fight was what is Pepsi's share and what's Coke's share," Harsha Razdan, head of the consumer markets practice at KPMG's India unit, told Bloomberg. "Now you're competing with everyone else."
Coke's ethnic drink push will dovetail into its $1.7-billion foray into locally grown fruit juices. It's raising vast plantations of fruits like mango and litchi to produce industrial levels of concentrate to make these juices available at low prices, and maybe even export them.