Coca Cola test water retail "two music" showdown

On December 12 last year, Coca-Cola's stock market value was exceeded by Pepsi for the first time. The key lies in the success of the latter's diversified operations in recent years, while Coca-Cola has stopped at the beverage business. Coca-Cola's operating pressure is considerable.

It seems that the offensive and defensive battle between Coca-Cola and Pepsi, a hundred years old enemy, will enter a new climax.

Since last year, Coca-Cola has authorized the opening of 20 Coca-Cola stores in key cities such as Shanghai, Beijing, and Guangzhou, and it expects to build about 400 chain stores in the next 2-3 years.

Some industry insiders speculate that Coca-Cola may be trying to diversify its business. On December 12 last year, Coca-Cola's stock market value was exceeded by Pepsi for the first time. The key lies in the success of the latter's diversified operations in recent years, while Coca-Cola has stopped at the beverage business.

Why Coca-Cola chose to test the retail model of a large-scale retail store in the Chinese market, which is obviously related to the "two music" in the market's close fight.

Coca-Cola Power Retail

On New Year's Day holiday, when reporters came to the Coca-Cola Store on the second floor of Tianhe City, Guangzhou, dozens of young consumers stopped in the 50-square-meter shop. Items displayed in the store range from household items to clothing, stationery, toys, gifts and collectibles, all of which are derivatives of the Coca-Cola brand.

“The specialty store is the Coca-Cola Company that extends the beverage culture to life.” The only person in charge of the retail department of Shenzhen Keshang Trading Co., which is authorized by Coca-Cola to operate a specialty store, told reporters. At present, the company focuses on three cities, namely Shanghai, Beijing, and Guangzhou. It mainly operates direct sales stores in the first-tier cities and coordinates Coca-Cola's marketing strategies from various aspects such as commodity structure.

Wang Yufeng, director of the South China Department of Public Affairs and Communications at Coca-Cola (China), denied that the company wanted to diversify its water, saying that it was only part of the Coca-Cola brand promotion campaign. In 2006, Coca-Cola's global slogan was "Welcome to Coke Life."

Tan Changchun, who once served as Coca-Cola Product Manager, said that although Coca-Cola stores sell clothing and household items, unlike Pepsi's production of shoes and Wahaha's production of clothing, items in Coca-Cola stores are more of a brand-name license. According to the reporter’s understanding, most of the products in the specialty stores are produced by Shenzhen Keshang Trading Company, and a small part of them are imported from China by foreign licensees.

“But this is certainly related to Pepsi.” A person who worked for 6 years in a joint venture between Coca-Cola and Swire Group analyzed that Coca-Cola has basically completed the layout of the national bottling plant and the competition for “Two Fun” will enter a new stage. . It is Coca Cola’s attempt to operate something new and does not rule out the possibility of diversification.

"Two music" wrestling upgrade

In the Chinese market, the duo of "Two Music" will always be playing hard, and the market match in 2006 will resurrect the situation.

One traveler once said that in the small oasis in Xinjiang's Gobi in the previous year, only three brands of goods were known in the small shop: Coca-Cola beverages, instant noodles and Wrigley. Visible, Coca-Cola distribution coverage is very wide.

“As a pioneer, Coca-Cola has always positioned itself in the national market for its development in the Chinese market.” The above-mentioned person who worked in the Swire Coca-Cola system told reporters. This year, with the launch of the Coca-Cola Lanzhou bottling plant, covering the five provinces in the northwest and the Xinjiang plant project, the Coca-Cola national bottling system has basically completed its layout. According to the reporter's understanding, Coca-Cola is currently bringing together its three major partners in China, COFCO, Kerry Group, and Swire Group, and has installed 30 bottling plants throughout the country.

In addition, COFCO COFCO, which has always been the most cautious, has also expanded rapidly in the past two years. Jilin, Lanzhou, and Zhanjiang are three new investment bottling plants, accounting for 50% of the total number of Coca-Cola holding bottling plants currently engaged in COFCO. As a result, the benign operation of the three major systems has been formed. At present, Coca-Cola has devoted more energy to market work, such as operating specialized stores.

"Coca-Cola is like a regular army, and Pepsi is more like a guerrilla." A Coca-Cola employee said with a smile. But the guerrilla tactics of Pepsi's "focus on breakthroughs in the advantage of superior forces" have made Coca-Cola breathless. Now Shanghai, Guangzhou, Chongqing and other cities have been “undermined” by Pepsi. This year, Coca-Cola has struggled to “recover lost ground” in the Chongqing market. In other markets, the actions of the two companies also followed suit. After Coca-Cola took a lead in Lanzhou shortly before, Pepsi immediately followed suit.

Previously, Coca-Cola's stock market value was first surpassed by 100-year rival Pepsi Cola, causing shocks in the industry and pushing the competition of “Two Funs” to a more sensitive level. Although both companies stated that the market value of stocks cannot fully reflect the business situation, the psychological impact of this incident cannot be ignored.

The industry attributed the frustration of Coca Cola to its adherence to beverage business, especially carbonated beverages. Therefore, in 2006, Coca-Cola will seek more market space in non-carbonated beverages and other markets.

Non-carbonated drinks into the focus

"Unlike Coca-Cola, Pepsi Group is a diversified group integrating food and beverages," said Lu Jin, Director of the Public Affairs Department of PepsiCo (China). In 2006, PepsiCo will accelerate its pace in the non-carbonated beverage sector and promote sports drinks in succession. Water, coffee, juice, tea beverages and other businesses.

According to Lu Jin, at present, Pepsi non-carbonated beverages mainly include pure Connor, Dole, Gatorade, etc. These are the world's top brands, and “Pepsi is actually the second brand in the world”.

However, in the Chinese market, Coca-Cola's non-carbonated beverages are ahead of Pepsi.

“Currently, non-carbonated beverages account for more than 20% of Coca-Cola’s overall sales in terms of sales, and this proportion continues to increase.” The above-mentioned people who worked at the Swire System stated that Coca-Cola’s goal is to be a full-scale company. Beverage company.

At the same time, he believes Coca-Cola's development in the non-carbonated beverage market over the past two years has benefited from leveraging the effective operation of the three systems. Pepsi-Cola is a non-carbonated beverage that operates independently and has nothing to do with the bottling system. The inability to achieve unity at all locations results in relatively slow development.

People in the industry believe that non-carbonated beverages will become a crucial piece in the future "two music" competition. For the Chinese market, whoever leads the "Two Music" will take the initiative in development.