Coke vs Pepsi in India
THE BEVERAGE BATTLEFIELD
In 2003, Jagdeep Kapoor, chairman of Samsika Marketing Consultants in Mumbai (formerly Bombay), commented that "Coke lost a number ofyears over errors. But at last it seems to be getting its positioning right." Similarly, Ronald McEachern, PepsiCo 's Asia chief, asserted "India is the beverage battlefield for 2003."
The experience ofthe world 's two giant soft drinks companies in India during the 1990s and the beginning of the new millennium was not a happy one, even though the government had opened its doors wide to foreign companies. Both companies experienced a range ofunexpected problems and difficult situations that led them to recognize that competing in India requires special knowledge, skills, and local expertise. In many ways, Coke and Pepsi managers had to learn the hard way that "what works here" does not always "work there." In spring 2003, Alex von Behr, the president of Coca-Cola India, admitted ruefully, "The environment in India is challenging, but we 're learning how to crack it."
THE INDIAN SOFT DRINKS INDUS"rRY
In India, over 45 percent of the soft drinks industry in 1993 consisted of small manufacturers. Their combined business was worth $3.2 million dollars. Leading producers inc1uded Parle Agro (hereafter "Parle"), Pure Drinks, Modern Foods, and McDowells. They offered carbonated orange and lemon-lime beverage drinks. Coca-Cola Corporation (hereafter "Coca-Cola") was only a distant memory to most Indians at that time. The company had been present in the Indian market from 1958 until its withdrawal in 1977, following a dispute with the government over its trade secrets. After decades in the market, Coca-Cola chose to leave India rather than cut its equity stake to 40 percent and hand over its secret formula for the syrup.
Following Coca-Cola 's departure, Parle became the market leader and established thriving export franchise businesses in Dubai, Kuwait, Saudi Arabia, and Oman in the Gulf, along with Sri Lanka. It
In 2003, Jagdeep Kapoor, chairman of Samsika Marketing Consultants in Mumbai (formerly Bombay), commented that "Coke lost a number ofyears over errors. But at last it seems to be getting its positioning right." Similarly, Ronald McEachern, PepsiCo 's Asia chief, asserted "India is the beverage battlefield for 2003."
The experience ofthe world 's two giant soft drinks companies in India during the 1990s and the beginning of the new millennium was not a happy one, even though the government had opened its doors wide to foreign companies. Both companies experienced a range ofunexpected problems and difficult situations that led them to recognize that competing in India requires special knowledge, skills, and local expertise. In many ways, Coke and Pepsi managers had to learn the hard way that "what works here" does not always "work there." In spring 2003, Alex von Behr, the president of Coca-Cola India, admitted ruefully, "The environment in India is challenging, but we 're learning how to crack it."
THE INDIAN SOFT DRINKS INDUS"rRY
In India, over 45 percent of the soft drinks industry in 1993 consisted of small manufacturers. Their combined business was worth $3.2 million dollars. Leading producers inc1uded Parle Agro (hereafter "Parle"), Pure Drinks, Modern Foods, and McDowells. They offered carbonated orange and lemon-lime beverage drinks. Coca-Cola Corporation (hereafter "Coca-Cola") was only a distant memory to most Indians at that time. The company had been present in the Indian market from 1958 until its withdrawal in 1977, following a dispute with the government over its trade secrets. After decades in the market, Coca-Cola chose to leave India rather than cut its equity stake to 40 percent and hand over its secret formula for the syrup.
Following Coca-Cola 's departure, Parle became the market leader and established thriving export franchise businesses in Dubai, Kuwait, Saudi Arabia, and Oman in the Gulf, along with Sri Lanka. It