Coke, Pepsi to chart aggressive drive to woo back customers
US multinationals Coca-Cola and Pepsi are set to embark on an aggressive marketing drive to win back customer trust after getting the Government's clean billing to their soft drink brands.
A fortnight after a report by the Centre for Science and Environment (CSE) alleging that 12 soft drinks brands of Coca-Cola and Pepsi contained pesticides badly hit their sales, the companies are going all out to rev up sales.
"We will do everything in the days ahead to restore customer confidence in our products," said Sunil Gupta, vice president of public affairs and communications for Coca-Cola India.
"After the Government's categorical declaration that our products are safe, it is now our job to see that our customers across the country get the right message," Gupta told IANS.
"We are planning a series of advertisement and awareness campaign using a combination of print, electronic, radio and web site media to disseminate the message that our products are safe."
According to Gupta, the company is also planning to launch a new ad campaign involving film star Aamir Khan. He, however, refused to disclose whether the ad theme would revolve around the pesticide scare.
The Coca-Cola official said as part of its new marketing drive, the company would also contact its retailers in different parts of the country and launch the awareness campaign in regional languages.
"Retailer is a very important part of our business and it is absolutely crucial to get their confidence back in our products," Gupta said. The company refused to disclose investments earmarked for the new marketing campaign.
Coca-Cola admitted its sales in India had slid by up to 15 percent following the pesticide allegations, but is now showing signs of consolidation.
Industry observers, however, say the sales of cold drinks in New Delhi and Mumbai had fallen by 20-25 percent since the CSE report was unveiled August 5.
CSE rattled the $1.2 billion soft drinks market by claiming that the pesticides found in the brands of Coca-Cola and Pepsi could cause cancer, damage to the nervous and reproductive systems, and severe disruption of the immune system.
The study revealed that total pesticides in all Pepsi brands on an average were 0.0180 milligram per litre, 36 times higher than the European Union (EU) limit for total pesticides.
Total pesticides in all Coca-Cola brands on an average were 0.0150 mg/l, 30 times higher than the EU limit.
The CSE report had caused widespread outrage as millions of Indians reacted to revelations that prominent soft drinks of Pepsi and Coke contained pesticides in quantities that could endanger health severely.
Coke and Pepsi were also banned from Parliament premises and many official institutions, as Indians turned to other thirst quenchers, causing a dent in the sales.
In a statement in the Lok Sabha on Thursday, Health Minister Sushma Swaraj dismissed the CSE report, saying the 12 samples do not have pesticide residues of the high order as was alleged.
Enthused by the clean chit, Pepsi on Friday put out huge advertisements in leading national dailies aimed at wooing the flustered customer.
"Refresh your faith. Now, refresh your thirst," said the ad. "Don't hold back your taste-buds."
Kapil Chug, a senior analyst with retail market research firm KSA Technopak, said the sale of soft drinks in the domestic market are likely to pick up in the days ahead after the government's clarification.
"The dismissal of the allegations clearly clears the ambiguity from the mind of an average customer who were not sure whom to believe, the soft drink makers or the environmental group," he said.
"The soft drinks industry is basically a sentiment driven industry and therefore if the companies manage to take this government's endorsement to people in far flung areas, I think sales would improve over the next couple of weeks."
Coca-Cola and Pepsi account for more than 90 percent of the carbonated drinks market in India. As much as 6.5 billion cold drinks bottles were sold in India in fiscal 2000-01.