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Coke’s celebration of its 125th birthday
in early May this year, presented
a perfect opportunity to its partisans
to engrave praises at their beloved brand.
However, for them, this article might appear
to be perfectly mistimed because as a
norm we do not discuss about stumbling
blocks on birthdays. Nevertheless, if you are
an Indian admirer of this great brand, a question
that is bound to pop-up whenever you
talk, read or listen to Coke’s feats and triumphs
is that, when the ‘Big Red’ has been
ruling the market in most of the 200 countries
it operates in, then why is it not working
in my country? Another question that
would trouble you all the more is, How
Coca-Cola’s other brands are doing better
than Coke in spite of Coke being the stronger,
bigger and older brand?
Branding and marketing literature clearly
suggests that, more often than not, brands
with high recall and recognition, strong
legacy and rich heritage tend to work better
than their competitors. So, it might sound
customary that there is a higher probability
of success of established brands in comparison
to newer brands which do not score high
on these parameters. The probability of success
of newer brands also gets trimmed down
because the established brands create a
strong entry barrier for them. Hence, success
of a stronger and older brand is taken as
a given. But, exactly the opposite of this is
happening here in India. Consumers of, and
brands in, carbonated soft drink industry are
screening a striking contrast between ground
realities and the theoretical underpinnings
presented in literature.
To be specific, this contrast is about a
company (The Coca-Cola Company or
TCCC) that is struggling for almost two decades
to position its very strong flagship
brand (Coke) in a market (India) where the
brand recall, recognition, legacy and heritage
for brand Coke is immense; and on the
contrary, the same company has successfully
managed to strongly position some of its
smaller and newer brands (Sprite and Thums
Up) in the same market. In other words, a
stark contrast exists between what the
theory suggests and what is happening in the
market. In other words, theoretically, Coke
is more likely to do better in India, which it
is not and secondly, Coca-Cola has achieved
a rather difficult feat of successfully positioning
its newer, smaller and weaker brands
(relative to Coke) in this highly competitive
space.
It would be interesting to know as to why
and how this contrast exists. Also, what has
been the difference between TCCC’s strategy
for Coke and that for its other brands, in
India? In other words, what is TCCC doing
or not doing with Coke and what it is doing
or not doing with its other brands? Or, what
is holding ‘Coke’ back and what is working
as a push for TCCC’s other brands? An account
of what Pepsi has done correctly in
India would be interesting as well as it would
add another dimension (of external competition)
to this analysis of branding strategies
in the carbonated soft drink industry of
India.
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