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The Rediff Business Special/Cola Wars

Shapely bottles, unseemly battles

Fizzy cocktail of glamour and clamour

The rivalry between both companies is bound to get out of hand, given that they have their eyes on the same market segments, and produce similar products. Not just that, they eye the same advertising agencies, the same filmmakers, art-directors and marketing people.

In fact, the battle never got as murky as it did last summer, when Pepsi ridiculed the Coke ad campaign of ''Eat cricket, sleep cricket, drink only Coca- Cola" by showing Azharuddin and Jadeja trying unsuccessfully to eat a cricket bat and a stump and sleep on a cricket pad. Coke, stung, retaliated by producing two monkeys that symbolised Azhar and Jadeja fighting over a banana and called them the ''lost generation''; a dig aimed at Pepsi's ''New Generation'' logo. Pepsi's logo now reads ''Generation Next''.

Within the advertising industry both Pepsi and Coke hurl accusations of poaching people, and stealing ideas at each other. Especially when cricket season arrives, Coke and Pepsi's television advertisements always end up with similar themes, whether by design or default.

While Pepsi claims that the original tune for the 'Sachin ala re ala' advertisement, showing Tendulkar in a dhobhi ghat was stolen by Coke in their Ramaiyya vasta vaiyya ad, Coke claims that it was actually Pepsi that did the stealing. Murmurs were also heard from both sides when an ad which showed Daler Mehndi arriving atop a Coke truck was closely followed by Shahrukh Khan and Rani Mukherjee on top of a Pepsi truck.

Things got really acrimonious when Pepsi went to court early last year, alleging that Coke was stealing Pepsi employees and bottlers by offering them higher rewards. Coke's answer was a shrug. "Frankly, if people want to come and work for the better company, why shouldn't they?" asked a Coke spokesperson at their headquarters in Delhi. The judgment in the case has been reserved by the Supreme Court and is expected in early May.

Where does this rivalry leave the Indian soft-beverage market? Market observers have often said that if Coke and Pepsi could cut out the undercutting and try to expand the market for soft-drinks, they would both probably double their reach.

Indians drink less soft-drinks than people in most other developed or developing parts of the world do. In 1997, the average number of soft-drinks consumed in India per person was only six drinks, as compared to the average Pakistani who drank 15 drinks in that year.

It goes to show that the Indian market is obviously not exploited to its potential. The main problem is that both Coke and Pepsi refuse to use even the same market research group, and as a result doubt the veracity of each other's sales figures.

In 1998, for example, the Indian Market Research Bureau put Pepsi's sales figures at 118 million cases, giving Pepsi a market share of 47 per cent. ORG-MARG, the market research agency patronised by Coca-Cola put Coke's sales figure at 128 million cases and gave it a 57 per cent market-share, incompatible with the IMRB figures. Both Coke and Pepsi contested each other's claims publicly.

The root of the problem, insiders say, comes from the fact that when Pepsi entered the market in 1989, they faced the daunting task of pacifying Indian swadeshi activists alone. Their trucks were smashed and offices ransacked so as to dissuade them from entering the Indian market. Whereas when Coke entered (or re-entered) the Indian market in 1993, the situation had been smoothed out by Pepsi already, and the atmosphere was extremely conducive to foreign multinationals coming to India.

Further, while Pepsi fought a bitter struggle upwards starting from a zero market-share, Coke simply bought out their rival, Parle Soft Drinks (who then had a whopping market-share of 70 per cent) and became the market leader in India. "If it wasn't for Parle," says Deepak Jolly of Pepsi, "Coke wouldn't have had a chance. We would have whipped them and all the other competition long ago. As it is, India is the only country where Pepsi has outstripped Coke in the market-share growth." Coca-Cola India, of course, contests that claim too.

Matters between Coke and Pepsi now can just get worse, as they have indeed succeeded in polarising stars, cricketers, admen, public relations companies, shops, restaurants, what have you. And as the temperature goes up this summer, one can just wait and watch to see how hot the Cold War really gets. Then again, to misquote the American basketball player endorsing the Lemon-fizz drink, "Will it really matter?"

Twinkle, Twinkle little star, she'll drink Coke, pair with Aamir

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