RURAL MARKETING STRATEGIES OF

COCA COLA

Presented by
Rohan Kamat (P-929) Pratik Gadade (P-918) Manish Chedha (P-908) Satish Subramanian (P-956)

AGENDA
Features and Constraints of Rural Market Coke in India Coke Rural Initiatives Brand Localization Rural Market Strategy ` Distribution and Advertising Strategy Rural Success Pepsi vs Coke Pesticide issue

FEATURES OF RURAL REGIONS

Large no. of consumers Density of population Majority of the income comes from agriculture Infrastructure facilities literacy Income Investment Savings

CONSTRAINTS OF RURAL MARKETS

Non-availability of retailers Scattered settlements Poor transportation facility Poor communication & mass media facilities Lack of product information Duplicate products

CONSTRAINTS OF RURAL MARKETS (CONT.)

Increase in the cost of distribution No warehousing facilities Inadequate banking facilities Seasonal income Inadequate credit facilities Low purchasing power

COKE IN INDIA

Leading soft drink brand in India until 1977 Acquisition of local popular Indian brands 39% volume growth in 2002 Domination of market by Coke & Pepsi 76% sales growth of soft-drinks between 1998-2002

COKE RURAL INITIATIVES

Competitive pricing Increase in the number of outlets Bridging the gap between soft drinks and other local options Doubled the spend on Doordarshan

CONTD

Tapping of local forms of entertainment Huge investments in infrastructure Result: 80% of new coke drinkers accounted by rural market Tremendous growth for coke in rural markets

THANDA GOES RURAL

Advertisement campaign featuring Aamir Khan Generic brand for cold-drinks The Accessibility Campaign Investment in distribution infrastructure

BRAND LOCALIZATION STRATEGY

The two Indias:

1) India A (Life ho to aisi): Metropolitan areas and large towns 2) India B ( Thanda matlab coca-cola): Smaller towns

RURAL MARKETING STRATEGY

Availability Affordability Awareness

AVAILABILITY

Strong distribution network; Central distribution system not feasible for rural areas; All-possible means of transportation used for transporting the stock; Adopted hub and spoke distribution system; Changed its distribution model.

AFFORDABILITY

According to survey conducted by CCI in 2001, 300 ml bottles were not popular; Price of Rs 10 was considered as too high; Significant changes made thereafter to win over the consumers; Chota Coke was introduced in 200 ml bottles and priced at Rs 5.

AWARENESS

Extensive marketing in mass media as well as outdoor advertising adopted; Hoardings were put and also name Coca Cola was painted on the compound; Participated in the weekly mandies along with annual haats and fairs.

DISTRIBUTION STRATEGY

Hit list of high potential villages from various districts Appointment of Hubs Offering of full-load supplies Fixed journey plans on a weekly basis

ADVERTISING STRATEGY

Communication media used in cities and urban areas would not work in villages Hence Coke decided to concentrate on 47,000 haats (weekly markets) & 25,000 melas (fairs) held annually in various parts of the country. CCI also launched television commercials (TVCs) targeted at rural consumers CCI increased its ad-spend on Doordarshan

CONTD

CCI launched Chota Coke in 2002 at Rs.5 It released a commercial showing Aamir Khan with 200 ml bottles to communicate message of the price cut This commercial was shot in a rural setting targeting rural market

CONTD

2002, CCI launched a new advertisement campaign

Featuring Bollywood star Aamir Khan y Targeted at rural, semi urban customers y Aimed to make Coke as a generic brand under name Thanda
y

Idea was to position Coca-Cola as a generic brand for cold drinks.

CONTD

Thanda Matlab Coca-cola Three commercials featuring Aamir Khan: 1.Tapori 2.Hyderabadi Shop-keeper 3.Punjabi Farmer

COCA COLA PRODUCTS

RURAL SUCCESS

Rural Market- an attractive target 37% Growth in 2003 in rural markets Doubling of per capita consumption between 2001-2003 50% of company sales in 2003

PEPSI VS COKE

Pepsi- Main competitor & rival Major regional players in rural market Focus of Pepsi on rural markets Slashing of price of 300ml bottles by Pepsico

PESTICIDE ISSUE

High pesticide content in soft drinks manufactured and sold by both cola majors.

Social and political groups against coke

A considerable decline in sales after August 2003.