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Coke launches new price war on Pepsi

Cola companies are turning the heat up this summer, and in line with the election mood and a parallel cricket festival in IPL, setting up strong contests ahead.

business Updated: Mar 08, 2014 00:02 IST
M Rajendran

Cola companies are turning the heat up this summer, and in line with the election mood and a parallel cricket festival in IPL, setting up strong contests ahead.

While two arch-rivals, PepsiCo and Coca-Cola Company have prepared a blueprint to capture the Rs 15,000-crore Indian soft drinks market, which appears more lucrative in the wake of the Indian Premiere League (IPL) Cricket season 2014 and Lok Sabha elections in May, smaller soft drink players such as Parle and Rasna have also lined up plans to grab a share of the pie.

Coke, which had abandoned its much-hyped plan to offer 200 ml bottles at Rs 5, is back with the Rs 5 tag all over again, this time for 100 ml cups. Pepsi's cheapest cola costs Rs 8 for a 200-ml bottle.

Coke's old plan was given up after it became economically viable, but keen to woo millions of consumers at the bottom of the pyramid, Coke is re-introducing the idea in a more careful step. The cups will be offered through strategically placed canters.

With "happiness on the go" as a slogan, Coke plans to run open trucks with mobile fountain machines parked at places where election rallies will to be held, industry sources said.

When contacted, the company spokesperson, however, did not confirm or deny the plans.

Meanwhile, Pepsi, the official sponsor of the IPL (The company has paid Rs 80 crore per year for title sponsorship to the Board of Control for Cricket in India and the tournament is now officially called Pepsi IPL) will focus on new campaigns for exisiting brands including Pepsi, Atom, Mountain Dew, 7up Nimbooz Masala soda, Miranda and Slice.

"We are looking at cross promotions of products," a PepsiCo India spokesperson told HT.

However, a source in Pepsi said the company has finalised its plans for summer but uncertainty looms over IPL venues. There is talk that some matches will be held in South Africa and/or the UAE in view of the elections. "The Pepsi IPL is a "local global" tournament. Distance and taking it away from its home ground could potentially kill a bit of its buzz amongst local fans and add to activation costs," the spokesperson said.

Parle Agro Pvt Ltd, which sells Frooti and Appy and LMN, is betting on coffee-flavoured carbonated drink Cafe Cuba to raise market share. Having captured the rural market, the company will focus on urban areas. "The company's lemon drink LMN has done well in the rural market and this summer, the focus is likely to turn to urban areas," said Nadia Chauhan, chief marketing officer, Parle Agro.

Pioma Industries, the Ahmedabad-based company that owns the Rasna brand, plans to launch two new flavours this summer, and focus on rural markets.