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Indian soft drinks market driven by the increase in celebrity endorsements

Press release   •   Aug 14, 2013 10:03 BST

In 2012, the Indian soft drinks market registered a stronger double digit off-trade value growth rate than the compound annual growth rate (CAGR) for the past five years.

This growth was attributable to strong double-digit performances in categories, such as bottled water and fruit/vegetable juice, which had a good year due to rising mercury levels. Long summers and higher disposable incomes continue to be the main growth drivers of soft drinks.

In carbonates, 2012 proved to be a year of brand revival, especially among the leading players, such as Coca-Cola and PepsiCo. A revamp of old brands started with Coca-Cola when it revived its Citra brand in lime carbonates. In August 2012 the company also revived its RimZim brand. Similarly PepsiCo revived its Duke brand in India

Revival of old brands started with Coca-Cola when it reintroduced its old Citra brand within lime carbonates. Citra was quite popular in the past due to its high advertisement with the tagline "Citra super cooler".

This brand was revived in February 2012 and was priced 20% cheaper than Coca-Cola‟s existing brands Sprite and Limca also in lime carbonates. In August 2012 the company also revived its old brand RimZim, a "masala soda" flavoured with cumin and other spices. The brand was re-launched in a few selected towns in Punjab, Haryana and parts of Delhi.

Similarly PepsiCo revived its Duke brand in four flavours - raspberry, masala soda, gingerade and ice cream soda - in Mumbai, where it enjoyed a strong presence in the past. As such, the company chose to focus solely on Mumbai this time around.

Tough competition between Coca-Cola and PepsiCo continued not just in carbonates but in other categories, such as bottled water as well as fruit/vegetable juice. Both companies are strengthening their non-carbonated drinks portfolio as carbonates are slowly losing their sheen to fruit/vegetable juice in urban India.

Companies spend heavily in marketing and advertising their brands. Companies are signing up with sports personalities and Bollywood stars in order to have an edge over the competition. Coca-Cola announced that it has signed Sachin Tendulkar as its "happiness ambassador" with the company continuing to focus on cricket as a medium for advertisement. Similarly PepsiCo became the new title sponsors of the Indian Premier League (IPL) starting from 2013 to 2017.

For more information on the Indian soft drinks market, see the latest research: Indian Soft Drinks Market

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