Cola War: Campa Cola by Mukesh Ambani Challenges Pepsi and Coca-Cola with Competitive Pricing - Read Now

Cola War: Campa Cola is gaining much popularity in the Indian soft drink markets and is already sending tremors down the spines of market giants in India, Pepsi and Coca-Cola. Campa Cola, since its relaunch under the Reliance stable, has been gaining a stronghold by directly positioning itself as one of the strong contender brands available in the market. Its products have proved to be one of the most affordable and sought-after beverages in the market. As this new campaign warms up, the onus falls on Pepsi and Coca-Cola to re-evaluate their strategies against this emerging threat.

The crucial reason for Campa Cola's success is its competitive price. Reliance is selling 200ml Campa Cola bottles at ₹10, whereas Pepsi and Coca-Cola have brought a 250ml bottle for ₹20. With this huge difference in price, Campa Cola managed to attract customers from this price-conscious market. The other factor is that the 500ml Campa Cola bottle is available at ₹20, while Coca-Cola is sold at ₹30 and Pepsi is sold at ₹40.

Threat from Campa Cola has made Pepsi and Coca-Cola ready themselves with budget-priced soft drinks. According to industry sources, the new line of products would be priced 15-20% lower than their mother lines and be designed for head-to-head battle against Campa Cola. In that sense, the bulk of this price-conscious consumer market cornered by Campa Cola would be tapped into.

Marketing strategies of the company have also played a critical role in this success as well. The company is offering retailers 6-8% margins, which are far higher than the 3.5-5% offered by Pepsi and Coca-Cola. Retailers have worked out incentives to aggressively promote Campa Cola, giving it an edge in market reach and distribution. Reacting to this, Pepsi and Coca-Cola are looking at the option of launching B-brands or regional labels to safeguard the market share of their flagship brands and sustain profitability.

Ravi Jaipuria, bottling partner of PepsiCo, said that if the need arises, the company may consider a product range to compare with Campa Cola's pricing. However, he added, PepsiCo is not too worried by Campa Cola's pricing strategy as yet.

For its part, Coca-Cola too is not resting on its laurels and is strategizing on how it can regain its market share. It has already studied this plan and is considering putting glass bottles in the market at ₹10 with a focus on Tier-2 and Tier-3 markets, where prices are paramount. It has employed this strategy earlier and is looking to do so again to regain market share from Campa Cola. The company will also introduce regional products such as RimZim Jeera, which would not get severely impacted due to pricing issues.

The more Campa Cola expands its market presence, the clearer it becomes that the Indian soft drink scenario is turning out to be more competitive. With aggressive pricing and strategies of distribution, Reliance has set a new benchmark that has not only brought Pepsi and Coca Cola to their toes, but has actually shook the giants into devising a new pricing model. Consumers will ultimately benefit from this competition as yet again, even cheaper options open up for them.

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