Soft drinks
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The document discusses the soft drinks market in India, which is dominated by carbonated soft drinks from Pepsi and Coke. However, the market is shifting from carbonated drinks to milk-based drinks (MBDs) and fruit juices due to health concerns. Amul dominates the MBD segment with its flavored milks, while Dabur and PepsiCo control around 80% of the fruit juice market. The document analyzes the marketing strategies and characteristics of these segments, concluding there is still scope for growth in the MBD category as Amul has only tapped a small part of the potential market.
Soft drinks
- 2. 2 The Segment Milk-Based Drinks Fruit Juices and Nectars Carbonated Soft Drinks
- 4. 4 Market Characteristics Extremely competitive, market dominated by Pepsico and Coke The total value of sales in this segment in the year 2006 were Rs 7000 crore The growth rate of the consumption 22% p.a.
- 5. 5 Critical Success Factors Brand strength Distribution network Bottling plants owned/efficient bottling Advertising expenditure Positioning, perceived value of product Visibility at retail locations
- 6. 6 Pepsi’s Marketing Mix Target segment – population in the age group 15–35 years Positioned as a ‘cool’ drink for the youth and the ‘Gen Next’
- 7. 7 4Ps Place • Introduction in A+ cities such as Chennai, Mumbai, Delhi and move to the rest • Pepsi started in Chennai and Coke in Mumbai Price • Initial penetration strategy • Prices move in tandem with oligopolistic nature of business
- 8. 8 Product • Product differentiation in terms of shape, bottles and cans, colours and logos. • Ultimately, difference in perception created Promotions • Film stars and cricketers • Sponsoring cricket tournaments • Lifestyle products 4Ps
- 9. 9 Market Scenario Sources: Infoquest, Fruit Juices in India, 2005 Datamonitor SoftDrinks in India to 2010, 2006
- 10. 10 Amul Flavoured milk (Kesar, Elaichi, Rose), Cool Café, Cool Coco, Lassi, Buttermilk 80% market share 35% growth expected 85% of sales in small outlets Shelf life 6 months No refrigeration required
- 11. 11 Real Fruit Juices Dabur Foods Division Pack sizes: 1ltr and 200 ml 6 months expiry, Tetrapak 40% market share 25% yearly growth Different distribution networks for 200 ml and 1 ltr variants Distributor promotions: 12+1 and 15+1 packs
- 12. 12 Comparison Brand Major selling SKUs Pack size Pack type Retail price Distributor margin Retailer margin Amul Flavoured milk (Kesar, Elaichi, Rose) 200 ml Glass bottle Rs 10 4.25% 10% Buttermilk, Lassi 200 ml Tetrapak Rs 7/Rs 12 4.25% 10% Cool Café, Cool Koko 200 ml Tetrapak Rs 12 4.25% 9% Real Orange, Mixed Fruit Juices 200 ml Tetrapak Rs 10 6.5% 15% Orange, Mango Juice 1 ltr Tetrapak Rs 70 6.5% 15% Activ: Orange- Carrot 1 ltr Tetrapak Rs 75 6.5% 12% Tropicana Juice: Orange 200 ml Tetrapak Rs 12 5% 12% Nectar: Mango, Orange 200 ml Tetrapak Rs 10 6% 15% Nectar: Orange 1 ltr Tetrapak Rs 60 6% 15%
- 13. 13 Market Characteristics - General Consumption of RTDs on the rise Have such drinks while on outings, hanging out, or as thirst quenchers Consumption highly seasonal Shift from CSDs to Juices and MBDs • Health concerns • Pesticide controversy Preference for Tetrapacks Word of mouth plays a major role Cost not a major factor
- 14. 14 Market Characteristics - MBDs Has not made significant inroads in the market Replacement for coffee or tea during summer months More filling than fruit juices Preference for coffee and chocolate flavours Do not stock MBDs at home Perception that they get spoiled easily
- 15. 15 Market Characteristics - Juices Fast growing segment Seen as a replacement for CSDs Orange and Mango flavours liked the most Health consciousness increasing, prefer no preservatives, sugar free versions Prefer to store them at home, over CSDs and MBDs
- 16. 16 Conclusions Carbonated drinks dominate the market Increased health consciousness making Fruit juices, MBDs on a growth path Pesticide controversies affected CSDs significantly
- 17. 17 Inferences Fruit juice market witnessing high competition • Major players Dabur, PepsiCo hold almost 80% • Numerous smaller players trying to enter • The previous year saw a launch of more than 10 new brands MBD market dominated by Amul • Large distribution network • Numerous variants • Established credence in milk-based segment • But still has tapped only a small segment of market
- 18. 18 Inferences Scope for entry in the MBD segment • Availability in the market not in tune with possible demand • Amul lagging in brand promotions and creation of hype Gradual change in consumer mindset Ready to accept non-carbonated drinks Distribution costs kept down by using packaging which negated the need for refrigeration
- 19. 19 Thank You!