Coca Cola: We’ve Got Milk in China!

Have you ever drunk the milk from Coca Cola? The Chinese people may feel impressed by the Coca Colas new product containing milk. The largest beverage company has decided to test in Chinas milk beverage market.

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n October 12, 2009, Coca Cola held a press release in Shanghai, in which more than 1,000 people were present. In the press release Coca Cola introduced its first milk beverage – Minute Maid Pulpy Super Milky. This is not only the expansion of the products category of Coca Colas Minute Maid, but also its first milk-based product in China.

Before this, Coca Cola has got fruit juice, tea and bottled water in the non-soda beverage field. According to an insider from Coca Cola, the company plans to make the Minute Maid Pulpy Super Milky enter into 300 cities in China by the end of 2009.

The Minute Maid Pulpy Super Milky was developed by the Global Innovation and Technology Center of Coca Cola in Shanghai. It was especially designed for the demand of the Chinese consumers. The Global Innovation and Technology Center was established in March 2009, costing Coca Cola 90 million US dollars. It is one of the six research and development centers of Coca Cola in the world. Before the milk-based product, this center developed the Minute Maid Grape Punch in June 2009.

“With the introduction of the Pulpy Super Milky, weve entered an exciting beverage field. This is a milestone for the Minute Maid brand,” said president of Coca Cola Greater China Douglas A. Jackson in the press release. “We introduced the product into the Chinese market for satisfying the demand of the Chinese consumers in the fruit milk beverages and improving the status of the Minute Maid in the market. In addition, it is an embodiment of Coca Colas fulfilling the promise for the Chinese market. As an all-directional beverage company, we make full use of the Coca Colas systematic resources and the technological advantages of our research and development center in Shanghai to continuously develop new products for satisfying the increasing demand of the consumers.”

The Emerging New Products

The Pulpy Super Milky was introduced shortly after the Minute Maid Hi-C Popping Lemonade, which shows the confidence of Coca Cola in the products of Minute Maid.

In 2004, the Minute Maid Fruit Grain of Orange was for the first time introduced in the Chinese market. Its innovative feature of “adding fruit meat in juice” made it become popular soon and was spread to the other countries in Asia. In 2007, Minute Maid Fruit Grain of Orange has taken the first place of the low-consistency juice market in China.

The analysts said that Minute Maid is a latecomer in the Chinese beverage market, but it entered this market in a high profile as an international brand. Before getting Minute Maid into China, Coca Coal has another fruit juice brand Qoo for a trial in China. Therefore, when Minute Maid came into China, it abandoned the troublesome process haunting the previous appearance; instead, it directly flowed into the market channels that had been developed by Qoo. This not only helped to reduce the cost of developing the new market, but also attracts the existing consumption groups of Coca Cola.

Now the Minute Maid products are sold in 100 more countries and areas, of which China is the second largest market after the USA. The new Minute Maid Pulpy Super Milky not only continues the innovative spirit of the brand, but also further enriches the products category of Minute Maid.

According to the information from Coca Cola, the company has more than 500 beverage brands. Apart from the most valuable brand – Coca Cola, the company has another 12 brands whose value is over 1 billion US dollars. Minute Maid is just one of them.

Great Potential in Fruit Milk Market

To get into the Chinese fruit milk market is a signal that Coca Cola wants to find a new profit growth point in the non-soda beverage field, as well as an implication for the Chinese milk product market to upgrade.

Compared with the tea and juice beverage market, the Chinese fruit milk beverage market is far from saturation. According to the statistical data from UK-based Canadean Limited, the sales amount of fruit milk beverages in China in 2008 has reached 6.2 billion liters. The market potential is unlimited. Meanwhile, the fruit milk beverages are the products with high profits, like the milk and fruit juices. But the Chinese administration department doesnt exert as strict supervision over the fruit milk products as the ones over the milk. Therefore, the fruit milk will be another “arena” in the Chinese beverage market.

Andres Kiger, senior marketing director of Coca Cola, said that Coca Cola “wants to be an all-directional beverage company”. The companys development strategies in these years all fully comply with this point.

In January 1979, Coca Cola became one of the first US enterprises entering into the Chinese market after 1949. At that time it mainly focused on the spread of soda drinks. After 2000, Coca Cola began the diversification in the beverage industry and gradually put the non-soda drinks as the main development object in China.

In 2002, Coca Cola began to step into the non-soda beverage market. That year the company acquired a non-soda drink producer – Dongguan Taigu Beverage Co., Ltd., at the price of 193.5 million yuan (USD 28.35 million).

Now, the research and development center of Coca Cola in Shanghai has already been engaged in the development of the non-soda drinks like tea, juices and water. To set up one of the six research and development centers in Shanghai also shows Coca Colas determination and ambition into the Chinese milk and juice market. Now Coca Cola has already declared the plan of adding 2-billion-USD investments in China in the next three years. Some of the money will be put into the distribution of new production lines and the development of new beverages.

Coca Cola is also changing its marketing method in China to meet the demand of the Chinese consumers. The experts attributed the popularity of Coca Colas products to its understanding the consumers. People doing marketing for Coca Cola said that it is very important to keep good emotional communications with the consumers. Take the image agent of Minute Maid for example. The first one is the Hong Kong film star Sean Lau, then the Olympic gold medalist Yang Wei and Chen Fei. Now the Hong Kong pop singer Eason Chan takes the role. Many experts thought that it was an “unexpected” but “considerable” choice.

On the way of products diversification, Coca Cola, with the aid of its global networks, began to enter into different fields. In order to raise the influence and fame of the new products, the company continuously maintains and improves the brand value of the Coca Cola brand.

By the end of October 2009, Coca Cola has already set up 39 bottling companies and employed about 33 thousand people in China. Coca Cola is also appraised as the most valuable brand in 2009 by the US Business Weekly, with the brand value of more than 68.7 billion US dollars.