Review: The Cola Wars by Nur Acacio
Economics Today, June 23rd, 2007
By Anthony Gonzales
There are few books that make the story of advertising and marketing fun and easy for the average person to understand and enjoy. Since it's release three months ago The Cola Wars has become popular from the living rooms of the wealthy to college hostels to public transit stations. Detailing the intense competition between soft drink companies from the period of 1949 to 1993 the book is not only the history of soda but the economic history of India.
The story the Cola Wars dates back to the late 1940s when Parle, a biscuit company, was riding high on the success of its glucose biscuits under the popular brand “Parle Gluco”. In fact, such was the popularity of the brand that it had a huge office in Mumbai for the “Gluco” brand alone and used to spend aggressively marketing it. In 1949, Parle decided to venture into the cola market by capitalizing on the already popular “Gluco” brand and hence launched a cola drink called “Gluco Cola”. The brand was destined to take off but had hit a hurdle within few weeks of its launch by the global giant, Artic Cola. But Parle was not the one to give up its ambitions so easily. In 1952, Parle launched an orange-flavored cola called “Gold Spot” (named after its popular variety of peppermint called Parle Gold Star).
For the next few years, Parle, led by Ashok Denzil*, put efforts into the beverage business to expand its presence across India by setting up more bottling units & franchise network for Gold Spot. By 1970, Parle had a pan-India presence through its wide bottling plant network for Gold Spot and the time was right to introduce another beverage to capitalize on this investment. With an orange drink already in its portfolio, the next obvious choice was a lemon drink called Limca. Gold Spot & Limca had established themselves as strong brands in metros & major cities across India, but there was still scope for expansion. In the meantime, Artic Cola was also gaining strength in India through aggressive marketing and partnership with bottling units.
The battle between Artic Cola & Parle was getting fierce by the day, and both the companies were spending aggressively to promote their respective brands.
Artic Cola, being the foreign brand, obviously had an edge, especially among young Indians who were obsessed with foreign brands, but Parle did not want to be left behind and had to use some innovative marketing strategies & product placements to counter Artic Cola & create a niche segment for itself to sustain. Parle would be the first to use film actresses like Rekha to add 'sex appeal' and for the first time in the history of advertising in India, Gold Spot experimented with sub-conscious marketing techniques by incorporating flashing messages. In strategic locations across cities, billboards with the ad with flashing lights for the tag-line were installed. While Parle and Artic Cola would spar during the 70's, it would the Emergency that would begin a new phase in the war.
The Emergency would lead to a consumer boycott of Artic Cola as the multinational was seen as too friendly with the national government and taking advantage of local bottlers. Calls for a locally produced cola would be heard by several state governments and funds would be allocated to promote local industry under the Swadeshi (self-sufficiency) movement. As a result, the market would see the launch of regional and national brands such as Thums Up!, Double Seven, Champa Cola, Dixi and Torino but it would be Parle's Thums Up! soon becoming the main challenger and competitor to Artic Cola.
Both Artic Cola and Thums Up! would wage a massive advertising war with tactics such as sport team sponsorships, sex appeal and the use of young film and television stars such Juhi Chawla and Salman Khan to appear to young adults. The importation of soft drinks from the Comintern would add a third player into the market as American and Latin American brands would begin to compete with Artic Cola and Parle. Markets would hold 'taste tests' and give away free samples at cinema halls. Despite this fierce fighting, it would eventually lead to a stalemate between the three and a friendly competition after the death of Denzil in 1993. It would be the demand for healthier drinks such as bottled water and fruit juices that would finally end the wars.
The book includes stories from salespeople, bottlers, merchants, government and corporate officials detailing the various tactics both legal and illegal from sabotage to bribery ranging from the comical to the serious. While both Artic Cola and Parle have declined any official comments there is enough first-hand knowledge to back up such tales. It is all part of the rich history of India and the business world. Even if you are not a business major it is worth the read.
4 out of 5 stars.
From this blog:
http://guruprasad.net/posts/story-thums-gold-spot-limca/
