Will Mukesh Ambani be able to give tough competition to Coca-Cola and Pepsi?
Recently Mukesh Ambani bought Campa Cola. Now questions are arising about whether this domestic company will be able to compete with all the foreign companies. You must also have some such questions in your mind. At present, Coca-Cola has the largest share of the cola market, followed by Pepsi. Apart from this, there is currently no big player in this market.
But now things are changing. Because now we have to see Campa as a big player in the Indian market. But the question is, will this cold drink of the 70s be able to become a market leader like Coca-Cola? Will it be easy for Campa to compete with Coca-Cola and Pepsi today? And this is an important question how big is this entire market of India?
Let's try to understand. First, let us understand this market in comparison to the carbonated soft drinks market in India as of date. If we talk about today, there is a market for soft drinks of about 68 thousand crores, and by 2030 this market will be about 1.5 lakh crores. By far the biggest players are Pepsi and Coca-Cola, which produce the drink in a wide variety of flavors.
Apart from these, some other local brands are sold at the regional level. One such brand is Sosyo. Which is the brand of Gujarat. There are about 1 lakh stores within reach of this brand and you know Mukesh Ambani has bought it, then one thing is understood. At least in Gujarat, Mukesh Ambani is going to dominate the cold drink market, but what about other places?
For this, first of all, you have to understand what has been the history of cola in India. The cola market started in the 1950s after India's independence. Coca-Cola's business was very good from 1950 to 1977 by foreign company Coca-Cola. Earned a lot of money because there was no competition in those days.
But around 1974, the government implemented the Foreign Exchange Regulation Act i.e. FERA. Under which it is necessary to dilute about 60% stake. Coca-Cola could not do this. That's why after some time Coca-Cola left the Indian market. Now it is obvious that when such a big player has gone out of the market, then some more new players will come to fill that place.
In 1977, Parle, an Indian company, launched its products in the market, one of which was Thumsup and other limca, then in 1977 Coca-Cola's bottling and sales distribution company Pure drinks group launched Campa Cola and this is where the story of Campa begins.
Although Pepsi entered the Indian market in 1990, after which a big political controversy was also seen and liberalization came in 1991 after that Coca-Cola re-entered India, i.e. India from 1977 to 91 You will get to see a war of cola. During this period, Campa Cola dominated the market for about 15 years, but due to the entry of foreign brands like Coca-Cola and Pepsi, the business of Campa Cola went down.
Now that time is about to return. Time will tell whether Mukesh Ambani will be able to make Campa Cola big again or not. But we can tell that two things are needed to move forward in the soft drink industry. First branding and second distribution. Both these things cost a lot of money. If we talk about the figures for the year 2021, then in the year 2021, Coca-Cola and Pepsi spent about ₹ 924 crores on the advertisement.
Whereas in 2020, both spent around ₹ 1196 crores. That is, the branding budget of these two giant companies in India is about one thousand to 1200 crores annually. If we talk about distribution, according to media reports both have around 60 lakh stores.
If we talk about spending one thousand to 1200 crore rupees on an advertisement, then it does not seem like a big deal for Mukesh Ambani. The way he entered the telecom market in 2016 and made everything free. This free series has also lasted for about 6 to 7 months. In such a situation, certainly, Mukesh Ambani will not hesitate to spend so much money to establish his foothold in the cola market.
On the other hand, when it comes
to distribution, at present, due to Jio's demand, the reach they have is around
50 lakh stores. Jio Mart also has 50 Lakhs, of active users. Not only this, but
Reliance also has its own 15,000 retail stores, where it can please the
customers by keeping its cold drinks at the front of the shelf and offering
them deep discounts.
This
means it is certain that Mukesh Ambani will now give tough competition to
Coca-Cola and Pepsi. You must have seen its effect recently. As soon as Mukesh
Ambani launched Campa Cola in the Indian market, he kept its initial price at ₹
10, seeing that Coca-Cola reduced the price of its ₹ 15 per bottle by ₹ 5 in
many states, and gave him ₹ 10.
Coca-Cola
has also reduced the price of its cold drinks in Telangana, Maharashtra, and
Madhya Pradesh. Now see, the Cola war has started. Let us tell you that the
price of a 500ml bottle of Coca-Cola was kept at ₹ 20. A 600 ml bottle costs
₹30, a 1-liter bottle costs ₹40, and a 2-liter bottle costs ₹80.
So it is visible that Mukesh Ambani has played a Jio-like bet in Campa Cola as well and has forced the biggest cola company to reduce the price. It is expected that in the coming days, the prices of Coca-Cola and Pepsi products may come down across the country.
While both these are foreign companies, the country's own company and Made in India Emotion can also work with Campa Cola. Not only this, if the government again launches a policy regarding foreign brands, then Coca-Cola and Pepsi can also suffer a huge loss, which will directly benefit Campa Cola.
Well, whatever it may be, it is certain that in the coming times, whatever bottles of Campa Cola, Coca-Cola, Pepsi, or any soft drinks are consumed in the market, are going to be available at low prices. what do you think, please comment on our site www.tradeipohub.co.in.