Coca-Cola India Launches Maaza Milky Delite

Coca-Cola India and Indian Soft Drink Market The Coca-Cola Company is looking at India figuring among the top five contributors to its global sales in the years ahead. With a healthy share of 34% in off-trade value sales in 2010, Coca-Cola was the leading player in Indias soft drinks market with well-established brands such as Thums Up, Coca-Cola and Maaza in its portfolio. Just to outline the dominance of CCI, it is the leading player in both carbonates and fruit/vegetable juices (Exhibit 1). Sports and energy drinks, bottled water, ready to drink (RTD) tea and fruit/vegetable juice all maintained bullish growth even as abundant rainfall seemed to halt the spectacular recovery of carbonates witnessed in 2009, most of the growth for beverage companies now is in the health and fruit-based drinks segment that is growing in double digits (Exhibit 2). Maaza Milky Delite: Product Features and Launch Last year in August, Coca-Cola India announced its entry into the ready-to-drink (RTD) dairy market with the launch of Maaza Milky Delite. The new beverage is a delicious blend of juicy mangoes and milk developed especially by Coca-Cola India in its Research & Development Laboratory in Gurgaon. Maaza Milky Delite, the latest innovation by Coca-Cola India is for teenagers and young adults and available in a 200 ml slim tetra pack, and has been affordably priced at Rs 15. The company executives think that this is a key step for us in our effort to become a complete beverages company and they expect the extension of the Maaza franchisee into milk-based beverages will allow Coca-Cola to leverage Maaza's goodwill. Prior to the launch, extensive consumer research and stability tests have been specially conducted to ensure that Maaza Milky Delite matched the taste preferences of the Indian consumers. During the R&D process of the product, the geographical aspect of India is also taken into consideration. The product has been formulated in such a manner, that it is able to withstand the Indian weather conditions and has a shelf life of 4 months. Coca-Cola India has drawn up an aggressive consumer activation campaign to market Maaza Milky Delite in the selected channels and outlets in Kolkata. The 360-degree marketing communication plan involves organizing road shows including extensive experiential sampling sessions, presence in engaging touch points, etc. Complementing the on ground initiatives, TV commercial bringing out the Sharing not possible proposition of Maaza Milky Delite, would be aired on all leading channels in Kolkata. Mango juice is the leading flavor for juice drinks in India (Exhibit 4) and it's also estimated that over 2.5 billion unit cases of dairy are consumed in India every year. Coca-Cola is, thus, trying to

bring together two items that Indians have been consuming for years. While the two rivals, Amul and Britannia, also have milk-based beverages in their portfolio; Coca-Cola hopes to leverage the goodness of milk and mango, and to embrace the double digit growth in this segment. Potential Risks Associated with Maaza Milky Delite According to the industry experts, a similar product launched by Parle Agro, a few years ago, and was not very well-received. Although, Coca-Cola executives claim that market scenario has changed and they are pretty sure consumers will love the product once they taste it, this is a risk for products performance. Mango maybe the most favorite juice flavor in India and milk can be consumed a lot by them but it doesnt mean that Indian consumer will pay attention to the mix of mango and milk. Other than the risk with satisfying the consumer taste bud, the new product is a dairy product which is perishable and requires Cool Chain system for supply chain and production, which Coca-Cola is not experienced especially in India, and considered the high temperature rates in India, production and distribution of this product should be handled very carefully by Coca-Cola executives.

Sources:
http://www.coca-colaindia.com/

Financial Express (2011), Front Page - All products aim at making us a total beverage company; Available by Emerging Markets Information Service. DNA Money (2011), After soda sparkle Coke eyes juice high; Available by Emerging Markets Information Service. Economic Times (2011), Food - Coca-Cola set to take plunge in juice market; Available by Emerging Markets Information Service. Hindustan Times (2011), India is strategic for Coca-Cola; Available by Emerging Markets Information Service. The Economic Times (2010), Coke enters dairy segment with Maaza Milky Delite; *Online+ Available at http://m.economictimes.com/PDAET/articleshow/6327772.cms Coca-Cola India Pvt Ltd India Company Profile by Euromonitor International, January 2011. Soft Drinks India by Euromonitor International : Country Market Insight , January 2011. Fruit/vegetable Juice India by Euromonitor International : Country Sector Briefing, January 2011

Exhibit 1 - Coca-Cola India Pvt Ltd: Competitive Position 2010

Brand Shares of Soft Drinks (RTD) by Total Volume 2007-2010

Exhibit 2 India Off-trade Sales of Soft Drinks (as sold) by Category: Volume 2005-2010

Exhibit 3 Maaza Milky Delite

Exhibit 4 - Leading Flavors for Juice Drinks (up to 24% Juice): % Volume Breakdown 2005-2010