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Coke steps up China juice marketing after failed bid

by Staff Writers
Shanghai (AFP) May 19, 2009
Coca-Cola on Tuesday launched a juice marketing offensive in China, making good on a vow to put more power behind its brands after Beijing shot down its bid to buy a leading Chinese juice maker.

Hong Kong pop star Eason Chan performed in the southern city of Guangzhou, kicking off a new campaign that the US beverage giant hopes will further raise the profile of its Minute Maid brand in the nation of 1.3 billion people.

The campaign is Coca-Cola's first major move in China since the government, citing competition concerns, blocked its 2.4-billion-dollar bid for Huiyuan Juice in March.

That deal, had it gone forward, would have been the largest ever takeover of a Chinese company by a foreign firm, and its rejection triggered fears that China was raising barriers to overseas companies.

Coca-Cola President and CEO Muhtar Kent responded at the time by saying the company would "focus all our energies and expertise on growing our existing brands", singling out juice products.

Andres Kiger, Coca-Cola's head of marketing in China, said the new campaign was part of an aggressive drive to expand the range of Minute Maid juice drinks sold in the Chinese market.

"It's happening now, there's an accelerated amount of new and exciting products coming into the market," Kiger told AFP. "The brands are getting stronger and additional investment is being done."

China is Coca-Cola's third largest market in the world and the second largest for Minute Maid, with more than one billion bottles sold last year, Kiger said.

Coca-Cola has big ambitions for China and is planning to invest two billion dollars in the country over the next three years -- compared with just 1.6 billion dollars spent since 1979.

The campaign launched on Tuesday is for a new white grape and aloe vera drink, the first product to come out of Coca-Cola's 90 million-dollar Shanghai research and development centre since it opened in March, Kiger said.

Chinese demand for juices is expected to increase as a result of rising incomes and a move toward healthier lifestyles.

Coca-Cola's marketing efforts in China focus on Minute Maid's pulp content, which makes it thicker and seem richer to Chinese consumers despite not being 100 percent juice, the company said.

As part of the new "Pulpy Experience" campaign, Chinese consumers are being asked to submit online videos showing how they drink Minute Maid, Kiger said. The winner will direct a behind-the-scenes video of the next Chan commercial.

Analysts predict China's beverage market, including sparkling drinks, teas and juices, is expected to continue growing at a rate of more than 16 percent annually.

Minute Maid sales have seen "strong double digit growth" year-on-year since the range was introduced in 2004, Coca-Cola said.

Coca-Cola and its rival PepsiCo do not release China-specific sales figures.

But Coca-Cola is believed to be the market leader in carbonated drinks, while Chinese drink maker Wahaha dominates the non-carbonated segment, according to analysts.

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