NEW DELHI: Regional ready-to-drink beverages brands, including
, Sosyo, Runner and Kashmira, put together grew more than twice the rate of national players like Coca-Cola and PepsiCo in calendar 2019, two industry officials said citing data from research firm
According to the data, all the hundreds of local brands put together increased their value share in the Rs 20,000-crore-plus non-alcoholic ready-to-drink retail beverages market to 24% last year, which is almost half the size of industry leader Coca-Cola’s 49.9% share and well ahead of PepsiCo’s 19.6%.
Hyper-localised flavours, trade push in smaller markets where Coca-Cola and PepsiCo are still under penetrated, direct-totrade incentives, lower pricing for some brands, and minimal overheads on marketing are helping regional brands to boost market share in spite of the two cola majors’ hyperlocalisation drive, said a top official at a leading bottling company in the country. “Despite the rollout of the goods and services tax (GST), we grew significantly over the previous year,” said J Ramesh, joint managing director at Chennai-based Kalimark Group that makes Bovonto soft drinks.
“While we don’t have bandwidth of multinationals in terms of budgets, growth indicates the potential of regional brands.” Presently available only in Tamil Nadu, the Bovonto brand is being extended to other markets in South India, Ramesh said. A spokesperson for Coca-Cola India said the company is committed to portfolio expansion. “We recognise that there are diverse consumers across the country and continue to focus on building a consumer-centric portfolio, including catering to regional and hyperlocal tastes.” He cited examples such as jeera drink RimZim and
The maker of the country’s top two aerated drinks Thums Up and Sprite and its closest rival PepsiCo had three years back set up specialised groups to track regional brands and expand their own reach to new markets and segments. A
spokesperson claimed sales growth of the company’s beverages portfolio “is ahead of the industry growth number called out by Nielsen”. “We are currently seeing a huge uptick in our business with all the brands in the portfolio showing very good momentum and gaining consumer equity,” the person said in an email revert to ET.
According to available data, Coca-Cola grew its share in the non-alcoholic ready-to-drink beverages — inclusive of packaged carbonated drinks, water and flavoured waters, sports drinks and juice drinks — by 0.5% year on year in 2019, while PepsiCo India’s share fell 2.2%. Regional brands put together grew 1.2% during the year.
A Nielsen spokesperson declined to validate the numbers “owing to client confidentiality policies that are in place”.
Soft drinks and flavoured waters are presently taxed at 40% which includes 28% tax and 12% additional cess.
Within overall beverages, aerated soft drinks have been growing faster, riding on prices that are almost a third that of juices. A one-litre pack of any branded juice is priced at about Rs 90, while a two-litre pack of any carbonated drink is priced about Rs 70.
The Coca-Cola spokesperson said in its own estimates — which include retail as well as other key channels including restaurants, travel and college cafeterias — the company’s share gain in 2019 has been “significant”.
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