coca cola india's thirst for the rural market

GROUP 2

PROFILE OF CCI IN INDIA Coca-Cola returned to India in 1993.

Coke acquired Thums Up , Limca, Maaza,

Citra and Gold Spot.

Acquisition gave CCI a market share of 60% with a network of 56 bottlers.

In 2000, Kinley was launched .

Cont…

Till 2003, Coca-Cola invested more than $1 billion in India.

CCI achieved 39% volume growth in 2002 while the industry grew 23% .

Based on 2002 performance ,CCI announced plans to double its capacity.

WHY RURAL MARKET?

Because of flat sales in the urban areas.

CCI began focusing on the rural market to increase volumes.

untapped rural market .

The real market in India is the rural areas.

Challenges in Rural market Poor rural infrastructure.

consumption habits are different from urban people.

Erratic power supply .

Cost of the coca cola.

cold beverages such as lassi and lemon juice.

CCI RURAL MARKETING STRATEGY

Availability.

Affordability.

Acceptability.

AVAILABILITY

To strengthening its distribution network.

Instead of centralized distribution system , it used hub and spoke distribution system.

It changed the type of vehicles used for transportation.

Distributed around 2,00,000 refrigerators to its rural retailers.

cont..

CCI made an additional investment of Rs 7 million to meet rural demand.

Which increase its presence in rural areas from a coverage of 81,383 villages in 2001 to 1,58,342 villages in August 2003.

CCI RURAL DISTRIBUTION SYSTEM

BOTTLING PLANT

HUBS

SPOKES

RETAILERS RETAILERS RETAILERS

AFFORDABILITY

Survey revealed that 300 ml bottles were not popular with rural people.

price of Rs10/- per bottle was considered too high by rural consumers.

Rural market is very price-sensitive.

Cont..

Reports suggested that, annual consumption in rural areas at 1 bottle compared to 6 bottles in urban areas.

In 2002, CCI launched 200 ml bottles (Chota Coke).

The 200 ml bottles priced at Rs. 5 would also make CCI competitive against local brands .

ACCEPTABILITY Through extensive marketing.

By putting hoardings and painting Coca Cola on the walls.

It participated in weekly mandies by setting up temporary retail outlets,also took part in the annual haats and fairs.

cont..

CCI also launched television commercials targeted at rural consumer.

CCI increased its ad-spend on Doordarshan.

CCI launched three commercials with the 'Thanda Matlab Coca-Cola' tag line