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QUESTION 1:CRITIQUE THE OVERALL BRANDING STRATEGY OF CCI.

Answer: Coca Cola once faced problems in growing in the Indian urban market despite being

one of the most recognized beverages brand in the world. After a successful presence in

urban market the market got saturated. Therefore it was necessary for coke to look for a new

market. The extension of this brand into the new untapped rural market had to adopt a

comprehensive branding strategy.

Coca Cola India (CCI) had to consider lots of unique factors associated with the rural markets

of India. The consumption habitat and the rural infrastructure were totally different than the

dominant market in the urban area. CCI had to change its view and went for a tailored

branding strategy which had a target of both extending the brand in a new region and

launching new advertisements. The new strategy that CCI had chosen had three As. These

are:

Availability Affordability Acceptability

Availability:

Availability of the product was a very important issue and played

an important role for Coca Cola not to have previously infiltratedthe market. The reason could be attributed to erratic power supply

which discouraged shopkeepers to preserve cold Coca Cola, poor

Infrastructure and also lack of a proper distribution network for

CCI. CCI had strategies to counter some of the issues.

The urban distribution system was direct with the product directly moving from the bottling

plant to the destination. However, this would not be possible in the rural scenario due to the

widespread geographical area to be covered. Therefore CCI decided to opt for a Hub &

Spoke distribution system where the product moves from the bottlers to hubs and from there

to the destination retailers. The model caused CCI to change its mode of transportation aswell. From large trucks carrying Coke to the hubs, the range of vehicles encompassed trucks,

auto rickshaws and even camels. CCI also made a total investment of Rs. 7 million to meet

the rural demand. As part of the availability enhancement, CCI also distributed around

200,000 refrigerators and acquired new vehicles.

Outcomes:

25 new production lines Glass and PET production doubled

Coverage of 81,383 villages in 2001 to 1,58,342 villages in August 2003

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Affordability

The rural population of India is very price sensitive

with price coming before brand loyalty or values incase of choosing a product. Therefore, they are

extremely prone to shifting to any local cheaper cola

than a globally acclaimed, popular and better quality

cola that may not be so cheap. Therefore, CCI had to

take appropriate measures to respond to the price

sensitivity.

A survey conducted found out that the 300ml bottle priced at Rs. 10 was considered too high

by the rural consumers. So, they were often consuming local colas such at Choice and Tikli at

considerably lower price.

CCI decided to market aggressively in the face of competition and decided to introduce

Chota Coke, a bottle of 200ml at only Rs.5. This was intended to increase the consumpti on

which was just one-sixth that of the urban consumption.

Acceptability

The rural Indian consumers considered basically two types of

beveragesthe hot one, which is tea and the cold one which was

mainly nimbu pani (lemonade) and lassi CCI decided to change

the attitude and bring in Coke as the new thanda or the cold one.

This was to form the capstone of CCIs branding strategy to makethe rural consumers accept Coke as a popular beverage.

In order to accomplish the acceptability goal, CCI undertook massive

program in both the mass media and outdoor advertising. Their

advertisement strategies included both customized ads for the rural

consumers and also participating in the local fairs or haats which

were the major source of business and entertainment in the rural

areas.

The most effective and focused part of the campaign was the advertisements featuring Aamir

Khan to establish Coke as the new Thanda. As said before, rural Indians are accustomed to

know nimbu pani as Thanda and the fact holds true in restaurants and stalls too. In order to

introduce Coke into the trend, CCI launched three commercials with the tagline Thanda

matlab Coca Cola. All three featured Aamir Khan in rural or semi-urban scenario, once as a

street smart, the next as a shopkeeper and the third as a farmer. All three also displays him

offering Coke when Thanda is mentioned or correcting people about asking for Thanda

when asking for Coke. The three commercials were intended to create a connection of Coke

to the rural consumers and increase awareness of the brand.

However, competition was very stiff with the local colas already enjoying a healthy marketshare and a strong position and also PepsiCo moving in the rural segment as well. CCI have

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to face problems since PepsiCo intends to have an even more aggressive pricing strategy.

Moreover, CCI also declared to stick only to their current cola beverage and dropped plans to

move into other beverage lines.

All these activities of CCI fell under revitalizing the brand. The matured urban market

segment had reached a stagnant situation calling for CCI to strengthen their brand. There it

needed to revitalize their brand. One of the ways to revitalize a brand is to move to a new

market segment. However, that is not entirely necessary in this case as CCI did not need to

abandon the current market segment but rather expand to a new segment. For this, CCI

adjusted their source of brand equity in the rural regions and customized their pricing,

channel and communications strategy. CCI lowered their pricing, tapped into channels which

were unutilized before and also launched a new series of TV ads, all to enhance availability,

affordability and acceptability of the product.

The steps they have taken seem more or less adequate to cater to their current goals.

However, there might be room for some minor adjustments. Some suggestions may be as

follows:

Using renewable energy like solar power can be an effective way to use therefrigerators. This can work as a CSR activity as well.

CCI should go for product line extension. It should bring new types of beverages likeNimbu Paani with collaboration with companies like nestle.

CCI should also use other celebrity endorsement other than Aamir Khan. It can be anew celebrity who is a cricketer. People will be able to relate coke with two icons.

The plan for revitalizing their brand through the rural market was definitely one suiting the

time and scenario. The strategies they undertook would also serve to meet their goals and as

well reduce their costs. Their steps of price reduction, relating Coke with Aamir Khan, one of

the most popular and influential figures in India, using non formal media and the steps to

integrate Coke into the rural peoples daily lives were well placed. However, the strategies

should also incorporate sufficient contingency measures and also allow for product line

extension to stave off future competitions and secure a stronger foothold.

QUESTION 2.IN INDIA, IS COCA COLA PURSUING A GLOBAL BRANDING STRATEGY ORAN INTERNATIONAL BRANDING STRATEGY?PROVIDE EVIDENCE TO YOUR CHOICE.

The terms global branding strategy and international branding strategy often incites the

same concept in ones mind. However, it is to be noted that the meanings are quite different

no matter how similar the terms themselves may sound. The difference is akin to the

standardization vs. customization debate that is quite common when marketing products

over the borders.

Global branding considers the whole world as one single marketplace and brings forth

standard products that would fit into any market. International marketing, however, takes into

account the differences in the market and the consumer behavior in different nations. It

considers strategies which are customized to individual market needs and are therefore not

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Global (Standardized)

Centralized Distribution

Vehicles: Conventional (Large Trucks)

No further potential investment

Steady production

International (Customized)Hub and Spoke Distribution

Vehicles: Conventional and unconventional

Trucks, Auto-rickshaws, camels, etc.

Investment of Rs. 7 million

Increased production:

25 new production lines

Glass and PET production doubled

rigid like global strategies. Therefore global marketing has a single standardized strategy for

the globe while international strategies are made of strategies suitable for the international

markets.

From the case, it is evident that Coca Cola takes into consideration International Branding

strategies that are made up of product, pricing, channel and promotional strategies catering toindividual border specific markets. Moreover, it is also seen that the strategies are not just

country specific but also region specific as they are seen here to follow different strategies for

the urban and rural segments.

The evidence starts expressing itself from the very point that CCI realized the need to create a

branding strategy for the rural consumers. If global strategy had been followed, CCI would

have continued with their existing branding strategy in India. Rather they took steps in

tailoring their strategies to suit the differences in the consumer behavior and rural

infrastructure. Even within one political boundary, CCI managed to identify two separate

market categories.

The issue of erratic power supply and the high price sensitivity coupled with the apparent

lack of brand loyalty caused local brands to flourish. CCI had to undertake tailored strategies

to penetrate the vast market that comprised the major portion of Indias population. The

customized strategies followed 3A principle, which were availability, affordability and

acceptability. Below is a comparative study between the global strategic possibilities and the

already undertaken international strategies.

Availability

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As can be seen from the table above, CCI had already been going on with a centralized

distribution network that took Coke from the bottling plant directly to the retailers. The

system utilized large trucks. No reason for further investment was mentioned in the case.

Neither was any hint of further production just to cater to the urban needs.

However, CCI had shifted to Hub & Spoke distribution with large trucks delivering bottles tothe hubs and Coke was delivered to the retailers through conventional or unconventional

means. Moreover, it has been mentioned that an investment of Rs. 7 million was made just

for the rural market. As a consequence, the number of production lines increased and so did

the production. All these point the direction that CCI had incorporated International branding

strategy in the availability frontier.

Affordability

Affordability was an important issue to consider due to the low brand loyalty of the

consumers and the high price sensitivity. Therefore the local cola companies enjoyed a

healthy share of the market by selling their colas at a lower price. Now, if CCI had stuck to

Global policy, the bottle size would have remained at 300ml priced at Rs. 10, which is

considered expensive by the rural consumers. Moreover, local companies do not pose much

of a threat in the urban market and are not taken very seriously during branding strategies.

However, CCI did take the locals seriously and therefore in order to compete with them,

manufactured bottles of 200ml at Rs. 5. This change in the product and pricing strategy is a

part of the international branding strategy as evident from the customization carried out by

CCI.

Global (Standardized)

Bottle size & Price:300ml at Rs.

10

Local brands not considered

competitors

International (Customized)

Bottle size & Price200ml at Rs. 5

Local brands strong competitors

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Acceptability

Coca Cola was already enjoying decent revenue by positioning itself as a beverage to enjoy.

With standardized strategy, the positioning would have to same throughout the new target

market as well. Moreover, taglines, celebrity endorsements and their mode of marketing

would also be likely to stay the same.

However, Coca Cola was intended to enter the rural market by establishing itself as a daily

drink and be a part ofthe rural peoples daily lives. To establish it, Coke had to position itself

to be the new thanda the term used by the rural or sub-urban Indians to refer to any cold

drinks. Usually, the existing cultures dictated local nimbupaani or lassi to be the thanda.

Coke had to reposition itself to be the new thanda. For this, the tagline needed to be

changed. It changed to Thandamatlab Coca Cola so that people could relate to it.

Moreover, CCI also utilized the rural peoples love for Bollywood movies by endorsing

Aamir Khan in three of their customized TV ads. Further, in order to spread out their words

among the villages, CCI participated in the weekly haats or fairs for their promotional

purposes.

The above steps as well as using Hindi were to establish a friendly and desi brand image of

Coke. It was not to be seen as a foreign entity but as something of India itself. To do that,

CCI had to bring about changes, major enough to reposition the brand. The customization to

be brought about by CCI in the rural market segment of India shows that it had undertakeninternational branding strategy.

Global (Standardized) No brand repositioning

No change in tagline

No specific celebrity endorsement

No outdoor marketing

International (Customized)

Brand repositioning to relate Coke to

Thanda

New tagline Thandamatlab Coca Cola

Celebrity endorsement: Aamir Khan

Outdoor marketing through fairs andHaats

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India is a vast market. With the rural population comprising of the majority of the overall

population, it provides an extremely valuable market. However, owing to the vastness of the

market and the mixtures of cultures within it, it almost acts like mounting the international

barriers as well. Therefore, each segment, i.e. urban and rural must be handled withappropriate tailored strategies. Therefore, rather than a global standardized strategy, a

customized international strategy is much more suited for a market like India and that is

exactly what CCI have done in this case.

QUESTION 3:DO YOU THINK THE COMMUNICATION STRATEGY THAT CCI PURSUED WAS

EFFECTIVE ENOUGH TO INFLUENCE AND PROVIDE THE ACTUAL BRAND MEANING OF

COCA COLA TO THE TARGET AUDIENCE IN RURAL INDIA?EXPLAIN WITH PROPER

REASONING.

Answer

During the early 2000s, Coca Cola India launched a new marketing campaign to tap the vast

untapped market of rural India. This was a very risky yet potentially rewarding effort that was

more or less successful.

Summary of the campaign

CCI undertook a coordinated communication strategy in order gain a significant share of the

rural market. For this, they took some unique steps that were quite successful at the end of the

day. Some of these initiatives include:

Wall painting Coca Cola on the residential compounds villages

Hoardings in villages

Increased ad-spend on Doordarshan

Taking part in the annual haats and fairs

Participation in the weekly mandies by setting up temporary retail outlets

Television commercials (TVCs) targeted at rural consumers

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TVC 1 TVC 2 TVC 3

As expected, the biggest focus of this campaign was given on the TVCs. Bollywood actor

Aamir Khan was hired to communicate the message of the price cut and the launch of 200 ml

bottles to the rural consumers. The commercials were shot in a rural setting. The commercial

aimed at making coke a generic name for 'Thanda.' Thanda is a very North India-centric

phenomenon. If one goes to any restaurant in the north, attendants would promptly ask,'thanda ya garam?' 'Thanda' usually means lassi or nimbu pani, 'garam' is essentially tea.

Because the character, in itself, represented a culture, we wanted to equate Coke with

'Thanda', since 'Thanda' too is part of the popular dialect of the north. Thus making 'Thanda'

generic for Coca-Cola. With the long-playing possibilities of the 'Thanda' idea becoming

evident, 'Thanda' became the central idea.

Between March and September 2003, CCI launched three commercials with the 'Thanda

Matlab Coca-Cola' tag line. All the three commercials aimed to make rural and semi-urban

consumers connect with Coca-cola.

TVC 1: The first ad featured Aamir Khan as a 'tapori' (street smart); in the ad he makes the

association between Coca-Cola and the word 'Thanda.'. This was the first occasion of Coke

being equated with the term thanda. So the success of this ad was very critical for the

whole campaign.

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TVC 2: The second commercial in the series featured Aamir Khan as a 'Hyderabadi

shopkeeper'; here again he equates the word 'Thanda' with Coca-Cola. Here, he tells

customers to ask for Thanda instead of Coke. Thus he tries to push the idea of Coke

substituting Thanda in peoples mind.

TVC 3: The third commercial featured Aamir Khan as a 'Punjabi farmer'who offers Coca

Cola to ladies asking for Thanda. Here, the circle is somplete. It shows that Coke is offered

whenever Thanda is asked for, thus promoting the main motive of the campaign.

Our opinion The three commercials showed progression in associating 'Coke' with 'Thanda'

in a rural/semi-urban context. In the first commercial the connection of Coke with Thanda

was made, in the second one there was a subtle difference, with the shopkeeper asking

customers to ask for Thanda instead of Coke, and the third commercial showed that when one

asked for Thanda, one would get Coke. Analysts said that all the three commercials

succeeded in make rural consumers connect to Coke and increased awareness of the brand

among them. Along with TVCs, CCI also launched print advertisements in several regional

newspapers.

I believe the secondary brand association done here was a very unique idea. Associating the

brand with a local buzzword for beverage was a very clever yet practical idea. However, the

communication strategies for delivering this message could have been a bit better. The

following discussion shows what more could have been done in order to promote the new

brand meaning of Coca Cola to customers:

The message: The tagline Thanda matlab Coca Cola is very much a North Indian

approach. The term Thanda is also used in North India to refer to cold beverages. This

creates a problem as India is a huge country. One of the biggest market in India is the South

India. It is not only big in psize but also in terms of purchasing power. People of this region

are more prone to purchasing consumer goods due their comparatively better economic

condition. So a campaign completely ignoring them cannot be all in all successful. Not only

South India but the vast region on the East should also not be ignored.

The Execution: The style of the TVCs is also an issue here. It features Aamir as a North

Indian in all three of them. His language is also that of North Indians. This will create the

problem as stated above. Thus a question of adaptation arises here. In a mixed culture likeIndia, a standardized approach will not work in most of the cases.

The Media: The main media vehicle used here is TVC. A few newspaper ads also followed

this. However, this is not enough to convince the rural customers. They watch television very

rarely and read newspapers even more rarely. So, these two media are not going to get the job

done for Coke. Here, BTL is just as important as ATL.

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Adapting the TVC for different regions of India

South

East

Using local stars for the local broadcasting of theTVC

Rajanikanth

Prosenjit

Using Product Placement as a communiationstrategy

Movies

Serials

Using BTL for communicating new message

Wall painting

Buzz marketing

Based on the above discussion, our suggestion for the communication strategy would include:

Understanding the customers is key to success for any promotional campaign. If these

strategies were followed, then the campaign would have been successful in the rural areas of

entire India. However, the strategies used by CCI were also very innovative and deserves

applause. Coke is a global leader in beverage and that trend continues in India too.

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Prepared For:

Dr. A H M Ehsanul Huda Chowdhury

Course Instructor

Course: Brand management

Course Code: M 406

Prepared By:

Moshfeqa Karim (RQ-08)

Mir Naqibul Islam (ZR-17)

Mashfik Sarker Protik (ZR-25)

Syed Ibrahim Saajid (ZR-33)

Shahdidul Mihal Ahsan (ZR-43)

Shifat Hasan (ZR- 52)