INTRODUCTION

Beverage Industry in India: A Brief Insight

In India, beverages form an important part of the lives of people. It is an industry, in which the
players constantly innovate, in order to come up with better products to gain more consumers
and satisfy the existing consumers or customers.

BEVERAGES

Non-
Alcoholic
Alcoholic

Non-
Carbonated
Carbonated

Cola Non-Cola Non-Cola

BEVERAGE INDUSTRY IN INDIA
 The beverage industry is vast and there various ways of segmenting it, so as to cater the right
product to the right person. The different ways of segmenting it are as follows:

Alcoholic, non-alcoholic and sports beverages

Natural and Synthetic beverages

In-home consumption and out of home on premises consumption.

Age wise segmentation i.e. beverages for kids, for adults and for senior citizens.

The beverage market has still to achieve greater penetration and also a wider spread of
distribution. It is important to look at the entire beverage market, as a big opportunity, for brand
and sales growth in turn to add up to the overall growth of the food and beverage industry in the
economy.

The Carbonated Drinks Industry In India

The Rs.17000 crore market of carbonated drinks industry in India looked really bad just after the
―Pesticide‖ controversy last year. But some cool promotions and quick reactions by cola
companies have handled the crisis satisfactorily. The controversy has thought the industry few
lesson or so and in the process consumer and the economy also benefited.

―Colas, contributing more than 50 per cent to fizzy drink sales, saw a huge slide after the
pesticide controversy, but are believed to be making a come back. Thanks to increased
advertisement spends which is over 20 per cent higher than last year. There is some good news
on the non-cola segment. The lime and lemon segments with brands like sprite and 7up have
registered a 30 to 40 per cent growth, although on a smaller base. ―1 Nevertheless, the battle
between two cola giants, Coke & Pepsi, did not go any slow. Rather it has become fiercer. They
are now fighting each other even at the local level. That too the trend is as old as start of this
millennium.

―All‘s fair, as usual, in a cola war, even a slugfest between two real-life brothers! Always
thriving on ambush marketing activities, the two cola giants Coca-Cola India and PepsiCo have
now gone to the extent of putting up two real-life brothers (who also happen to be celebrities)
against each other with the strategic aim to gain rapid market share in one of the country‘s
largest carbonated soft drinks (CSD) market: Andhra Pradesh (AP).In the latest move, the
brothers who are also Telugu cine stars—Chiranjeevi and Pavan Kalyan—have been pitched
against each other by their respective sponsors Coke and Pepsi using a peculiar below-the-belt
technique.

The present scenario of the carbonated drinks market is behaving the way it has all to do with a
duopoly situation. A duopoly is a competitive situation where there are two competitors,
normally of roughly equal size. Although in every place they have local competitors and there is
a huge unorganized flavoured water market. Yet again, packaged water is also a competitor to
the cola brands and in this category neither of the two cola companies are market leaders.
However, as far as the carbonated drinks are concerned there are only two brands, Coke and
Pepsi. Therefore, we can safely say that this condition does qualify to be a near duopoly situation
and thus there is such intense competition. Unless, the two parties in a duopoly collaborate with
each other, which is certainly not the case in the cola market worldwide or in India, this battle is
not going to slow down even a bit! Rather, it would grow stronger with every passing day. In a
situation like this it is very interesting to observe marketing strategies in general and Product &
Pricing strategies in specific of the players, merely because the action of one player is bound to
invite similar reaction from the other. As if, the third law of Newton, that ―every action has an
equal and opposite reaction‖, can‘t fit better in any other situation!

In a duopoly like situation, as far as cola industry in India is concerned, it can be said that it is
foolish to cut prices unless, one of the two parties has a much lower cost base. But that is not the
case in India. In fact, both the companies, Coke and Pepsi, invest heavily in advertising and in
distribution through their franchise as well as their own systems. However, a great deal of
attention is paid by both companies to cost, particularly in the development of a tightly effective
supply chain system in which economies are squeezed out and, wherever possible both
overheads and working capital are controlled. Therefore, it is extremely difficult to for both the
parties to play with the prices. Rather, it is counter-productive exercise, as when prices are
reduced in a particular area by one of the cola brands, the second must follow.
If we look into the history of pricing of these two particular players of the carbonated drinks
industry, we will see that the first major initiative in the price front took place some years ago
when the brand Coca-Cola came back to India. At that point of time colas were available only in
200 ml bottles. Coca-Cola, in it‘s come back trail, broke the tradition by launching Cola in the
300 ml size bottles but at the same price as Pepsi, which was then in a 200 ml bottle. With this
strategy, Coke expected to gain advantage in the market especially in India, which is traditionally
a highly price sensitive market.
About Coca Cola

Coca-Cola, the product that has given the world its best-known taste was born in Atlanta,
Georgia, on May 8, 1886. Coca-Cola Company is the world‘s leading manufacturer, marketer
and distributor of non-alcoholic beverage concentrates and syrups, used to produce nearly 400
beverage brands.

The Coca-Cola Company began building its global network in the 1920s. Now operating in more
than 200 countries and producing nearly 400 brands, the Coca-Cola system has successfully
applied a simple formula on a global scale: ― “Provide a moment of refreshment for a small
amount of money- a billion times a day.”

The Coca-Cola Company and its network of bottlers comprise the most sophisticated and
pervasive production and distribution system in the world. More than anything, that system is
dedicated to people working long and hard to sell the products manufactured by the Company.
For more than 115 years, Coca-Cola has created a special moment of pleasure for hundreds of
millions of people every day.

The Company aims at increasing shareowner value over time. It accomplishes this by working
with its business partners to deliver satisfaction and value to consumers through a worldwide
system of superior brands and services, thus increasing brand equity on a global basis. They aim
at managing their business well with people who are strongly committed to the Company values
and culture and providing an appropriately controlled environment, to meet business goals and
objectives. The associates of this Company jointly take responsibility to ensure compliance with
the framework of policies and protect the Company‘s assets and resources whilst limiting
business risks.

Competitive Arena

The soft drink market all over the world has been witnessing a neck to neck battle between the
two major players, Coca-Cola and Pepsi since the very beginning. The thirst quenchers are trying
hard to have the major chunk of the pie of carbonated soft drink market. Both the players are
spending their energies in building capacity, infrastructure, promotional activities etc.
Coca-Cola being 11 years older than Pepsi has dominated the scene in most of the soft drink
markets in the world and enjoying leadership in terms of market share. But the Coca-Cola people
are finding it hard to keep away Pepsi, which has been narrowing the gaps regularly. The two are
posing threats to each other in every nook and corner of the world. While Coca-Cola has been
earning most of its bread and butter through beverage sales, Pepsi has a multi products portfolio
with some portion from the same business.

The two warriors are face to face once again here in India with different strategies and tactics to
attack the rival. Coca-cola is focusing upon the joint ventures with the existing bottlers {FOBO}
franchise owned bottling operations to enhance its control on manufacturing and marketing of its
products range and attain the quality standards of its class.

Countering it Pepsi has taken the battle in its own hands by floating as investment of $ 95 billion
to set Pepsi Company. India holdings, as subsidiary for {COBO} company owned bottling
operations. Both the companies are following different path to reach the same destiny i.e. to fetch
the bigger portion of aerated soft drink market. Both consider India a huge potential market, as
per capita consumption here is a mere 3 serving annually against the world average of 80.
Therefore, they are putting in their best efforts to woo the Indian consumer who has to work for
1.5 hours to buy a bottle of soft drink. In comparison to the international norms minutes, a major
hurdle to cross over for both the athletes for getting no.1 position comparison to the inter. Coca-
cola is well set with its 53 bottling sites through out the country giving it an edge over
competition by processing a well-built bottling and distribution set-up. On the other hand, Pepsi,
with two more years in India, has been able to set an image of a winner in India and has been
able to get the pulse of the India soft drink market. The soft drink giants are leaving on stone
unturned and her for the long terms.

Coca-cola has been penetrating the market through its wide product range with a determination
to change consumption pattern of soft drink in India. Firstly, they upgraded the whole industry
by introduction 300 ml bottles, which in turn had given the industry a booming growth of 20% as
compared to the earlier 5%. They want to develop a coca culture here and are working on a
strategy to offer soft drink in every possible package. In coca-cola camp, the idea of competition
has not come from Pepsi, but from the other beverages such as tea, coffee, Nimbu-Pani, water
etc. Pepsi is quite aggressive in its approach to Indian consumer. They are desperately working
on the strategy to be winners in the hot cola war between two big barons. According to Pepsi
philosophy, it‘s the madness that encourages executive to think, to conjure up those creative
tactics to knock the fizz out their competition. Pepsi had plumbed a large on the visibility of its
blue red and white logo. They have been going with aggressive marketing by putting Amir Khan,
Gautam Gambhir, Genelia D‟Souza in their advertisement to endorse their brand, the role
models for its targeted consumer the teenagers. They have increased the fizz in the market place
by introducing the dispensers called fountain Pepsi and have been enjoying a lead over its rival
there.

The latest communication showcases Aamir Khan as a narrator, observing different situations in
the lives of the people. Taking the audience through different moments of life Aamir observes
that though the times have changed but the happy moments are still celebrated together and not
in isolation. The entire communication is an ensemble of many such incidents in our lives. The
communication ends with Aamir saying “Aap Muskuraingey, Bul Bule Gun Gunayaingey” –
Open Happiness” (You smile, so do the Bubbles in a bottle of Coca-Cola).”

History of Coca Cola

Coca-Cola® originated as a soda fountain beverage in 1886 selling for five cents a
glass. Early growth was impressive, but it was only when a strong bottling system
developed that Coca-Cola became the world-famous brand it is today.

1894 – A modest start for a Bold Idea

In a candy store in Vicksburg, Mississippi, brisk sales of the new fountain beverage called Coca-
Cola impressed the store's owner, Joseph A. Biedenharn. He began bottling Coca-Cola to sell,
using a common glass bottle called a Hutchinson. Biedenharn sent a case to Asa Griggs Candler,
who owned the Company. Candler thanked him but took no action. One of his nephews already
had urged that Coca-Cola be bottled, but Candler focused on fountain sales.

1899 The first bottling agreement

Two young attorneys from Chattanooga, Tennessee believed they could build a business around
bottling Coca-Cola. In a meeting with Candler, Benjamin F. Thomas and Joseph B. Whitehead
obtained exclusive rights to bottle Coca-Cola across most of the United States (specifically
excluding Vicksburg) -- for the sum of one dollar. A third Chattanooga lawyer, John T. Lupton,
soon joined their venture.

1900-1909 … Rapid growth

The three pioneer bottlers divided the country into territories and sold bottling rights to local
entrepreneurs. Their efforts were boosted by major progress in bottling technology, which
improved efficiency and product quality. By 1909, nearly 400 Coca-Cola bottling plants were
operating, most of them family-owned businesses. Some were open only during hot-weather
months when demand was high.

1916 … Birth of the contour bottle

Bottlers worried that the straight-sided bottle for Coca-Cola was easily confused with imitators.
A group representing the Company and bottlers asked glass manufacturers to offer ideas for a
distinctive bottle. A design from the Root Glass Company of Terre Haute, Indiana won
enthusiastic approval in 1915 and was introduced in 1916. The contour bottle became one of the
few packages ever granted trademark status by the U.S. Patent Office. Today, it's one of the most
recognized icons in the world - even in the dark

1920s … Bottling overtakes fountain sales

As the 1920s dawned, more than 1,000 Coca-Cola bottlers were operating in the U.S. Their ideas
and zeal fueled steady growth. Six-bottle cartons were a huge hit after their 1923 introduction. A
few years later, open-top metal coolers became the forerunners of automated vending machines.
By the end of the 1920s, bottle sales of Coca-Cola exceeded fountain sales.

1920s and 30s … International expansion

Led by longtime Company leader Robert W. Woodruff, chief executive officer and chairman of
the Board, the Company began a major push to establish bottling operations outside the U.S.
Plants were opened in France, Guatemala, Honduras, Mexico, Belgium, Italy, Peru, Spain,
Australia and South Africa. By the time World War II began, Coca-Cola was being bottled in 44
countries.

1940s … Post-war growth

During the war, 64 bottling plants were set up around the world to supply the troops. This
followed an urgent request for bottling equipment and materials from General Eisenhower's base
in North Africa. Many of these war-time plants were later converted to civilian use, permanently
enlarging the bottling system and accelerating the growth of the Company's worldwide business.

1990s … New and growing markets

Political and economic changes opened vast markets that were closed or underdeveloped for
decades. After the fall of the Berlin Wall, the Company invested heavily to build plants in
Eastern Europe. And as the century closed, more than $1.5 billion was committed to new bottling
facilities in Africa.

21st Century…. & Still Going Strong

The Coca-Cola bottling system grew up with roots deeply planted in local communities. This
heritage serves the Company well today as people seek brands that honor local identity and the
distinctiveness of local markets. As was true a century ago, strong locally based relationships
between Coca-Cola bottlers, customers and communities are the foundation on which the entire
business grows.

Purpose of the study: The purpose of the study is to know the Survey & Findings on
consumer behavior towards beverages in Rajkishore Nagar Bilaspur (CG) .

Objectives of the study:

The main objectives of the study are:

 To Understanding Indian Beverage Industry (carbonated & non-carbonated).

 Consumer perception towards Coke.
 To understand buying behavior of consumers.
 Limitations of the study:

There were certain limitations in undertaking this research work. As it is understood that
limitation is a part of the project . They are:

 Time constraints.
 Difficult to gather primary data as some of the respondents
is not taking questionnaire seriously.

Research Methodology

Descriptive research- also known as statistical research, describes data and characteristics about
the population. Descriptive research answers the questions who, what, where, when and how.
The main source of information for this study is based on the data collection. Data collected are
both primary and secondary in nature.

Types of data collected

1. Primary data: it is based on questionnaire that will be distributed among consumers to

collect the data.
2. Secondary data: it is collected from organization, articles, magazines, books &
newspaper research reports.
3. Sample size: 200 consumers having history of consuming beverage will be selected as
sample size i.e. the total sample size will be 200 consumers. Than these samples were
further divide into sub-groups based on their age, gender etc.
4. Project would be conducted in a particular area/zone.i.e. Rajkishore Nagar Bilaspur.

Methods / tools of analysis

Tools used for analysis are:

 Percentage analysis
 Graph
 Correlation
 Pie chart