soft drink industry.docx

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1.1 INDUSTRY PROFILE Around 1984 the first branded soft drink came in the Indian market. This soft drink was named as gold spot. Before Coca-Cola entered the country to dominant the scene in 1950’s, Parley exports Pvt. Ltd were the first Indian company to introduce a lemon soft drink, this drink was known as Limca and it was introduce in 1970’s. However, before this they had introduced cola piping, which was withdrawn in face of tough competition from coca-cola. In the year 1977 coca-cola left Indian market and this brought in an opportunity for various Indian companies to show their caliber, at this time a new soft drink was introduced by parley product and this was named thrums up. This was Coca-cola drink, which had a burnt sugar color. This drink was introduced with a mighty “happy days are here again”. As if happy days went away with coca-cola .There was another company named pure drinks, which introduced the soft drink named campa-cola along with orange and lemon flavors. Just after this many more companies entered the Indian soft drink market. A soft drink named double-7 had been introduced by a company modern baker. Another company, Mohan meckins also came with a softy drink named marry & puck up. Mcdowell came with thrill, rush and sprit.

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Page 1: soft drink industry.docx

1.1 INDUSTRY PROFILE

Around 1984 the first branded soft drink came in the Indian market. This soft drink was named

as gold spot. Before Coca-Cola entered the country to dominant the scene in 1950’s, Parley

exports Pvt. Ltd were the first Indian company to introduce a lemon soft drink, this drink was

known as Limca and it was introduce in 1970’s. However, before this they had introduced cola

piping, which was withdrawn in face of tough competition from coca-cola.

In the year 1977 coca-cola left Indian market and this brought in an opportunity for various

Indian companies to show their caliber, at this time a new soft drink was introduced by parley

product and this was named thrums up.

This was Coca-cola drink, which had a burnt sugar color. This drink was introduced with a

mighty “happy days are here again”. As if happy days went away with coca-cola .There was

another company named pure drinks, which introduced the soft drink named campa-cola along

with orange and lemon flavors.

Just after this many more companies entered the Indian soft drink market. A soft drink named

double-7 had been introduced by a company modern baker. Another company, Mohan meckins

also came with a softy drink named marry & puck up. Mcdowell came with thrill, rush and sprit.

Previously there was no competition in the Indian soft drink market but with all these companies

coming in the Indian market a huge competition was a place with high voltage advertisement.

But in the year 1988 Pepsi was given permission to sell its soft drinks in the Indian market by the

government of India. Coca-cola also co history of soft drink come back 1993.

Soft Drink Market Indian Scenario

Indian soft drink industry is witnessing a boom time. Its growth rate is around 20% with such a

high growth rate, volume could reach billion crates with 10 years .Three major multinational

companies are fighting to grab a major chunk of business from Indian markets. These three

major multinational companies are fighting to grab a major chunk of business from Indian

markets. These three coca-cola, Pepsi, Cadbury. All of these companies have seen an enormous

Page 2: soft drink industry.docx

potential in this country .Consequently, by world standard India per capita consumption of soft

drinks is still very low. Therefore these soft drinks grants feel that fire capita consumption can

only grow up. Soft drinks industries has already seen and estimated sale of around 240 million

crates higher than last year’s sale of 204 million in 1998. The main reason for such a high

growth rate heightened competition between Coca-cola and Pepsi, Cadbury, being a new entrant

is for behind. India is actually more vivid in taste and preference than any other country market.

Delhi jar instance, accounts for about 20% of total soft consumption in terms of sales.

There are about 4, 80,000 soft drinks retailers in India and their numbers are increasing day by

day. This actually means that there is just one soft drink retailer on a population of 37,600,

which is far below the international standard. Where as Philippines has one soft drink retail

counter over a population of 150 people i.e. 4, 00,000 outlets on population of 60 million.

Soft drinks shows strong double-digit growth

In 2011, soft drinks registered a higher off-trade value growth rate than the review period

average. This growth was attributable to strong double-digit performances in sectors such as

sports and energy drinks, bottled water and fruit/vegetable juice, which had a good year due to

rising mercury levels. Long summers and higher disposable incomes are the main growth drivers

for the soft drinks category.

Fruit/vegetable juice outshines carbonates in terms of growth

Fruit/vegetable juice showed considerably stronger growth than carbonates, being viewed as a

healthier alternative. Soft drinks giants Coca-Cola India Pvt Ltd and pepsico India Holdings Pvt

Ltd have recognised this trend and are strengthening their product offerings in fruit/vegetable

juice. With a focus on healthy diets, consumers in urban areas are slowly shifting from

carbonates to fruit/vegetable juice, which also received a major growth boost from on-the-go

consumption.

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Coca-Cola and PepsiCo compete through lemonade/lime carbonates

Lemonade/lime carbonates was among the stronger performers in the carbonates category in

2011. Coca-Cola India Pvt Ltd and PepsiCo India Holdings Pvt Ltd continue to compete

aggressively in this category by increasing the visibility of their brands Sprite, Limca and 7-Up

respectively. Catchy taglines were used by manufacturers to generate consumer interest,

alongside aggressive campaigns using Bolly wood actors.

Modern retail shows steady growth

Leading chained retailers are on a major expansion drive, which has led to an increase in soft

drinks volume sales. Manufacturers have leveraged this to showcase their new variants in a bid

to broaden their consumer base. The modern retailing channel is helping to facilitate the growth

of soft drinks. Modern retail offers a unique experience for consumers, where they can touch and

feel the product before buying. Tier two and three cities have also seen the robust growth of

modern retail outlets.

Indians will continue to consume more soft drinks

Dynamic products such as sports and energy drinks, bottled water and fruit/vegetable juice will

drive strong growth in soft drinks during the forecast period. Soft drinks giants pepsico India

Holdings Pvt Ltd and Coca-Cola India Pvt Ltd are targeting the rural segment to enhance their

presence. The outlook for soft drinks looks very positive in the forecast period due to strong

marketing activities and product innovations by manufacturers.