Coca-Cola and Pepsi are extending their product lines to include healthier drinks, according to an article in last Sunday’s New York Times Magazine.
While Coca-Cola Classic will continue to make life taste good, its marketing team is exploring different markets in response to the lagging performance of carbonated soft drinks.
“Soft drinks aren’t showing any growth,” said School of Management marketing professor Roberta Clarke. “There is a whole trend in the market towards considering health products.”
An increased interest in products that have vitamins added — called nutraceuticals — has emerged, Clarke said, describing cereals that are sprayed with vitamins and juices that are supplemented by ginseng and kava.
“If you’re going to eat it, at least get the vitamins from it,” she said.
This emerging trend began with the “Gatorade concept” that helped to increase the popularity of sports drinks and health drinks with replenishing and rejuvenating qualities. According to Clarke, as drinks like Gatorade began to spread, so did a mentality of “niche markets” that target specific groups and specific wants.
“Niche marketers have come in and successfully introduced drinks based on who wants what — who wants the increased calcium, who wants the extra energy. They’re seeing bigger niches that they want to fill now,” she said.
With enough advertising support, Clarke said, Coke and Pepsi (who have both already successfully introduced their own brands of water, Dasani and Aquafina, respectively) will gain brand equity and become well known.
When building up the image of a new brand, the company must decide whether to use Coke brand leverage as assistance, College of Communication advertising professor Tobe Berkovitz said. Coke’s soft drink image might not be appropriate for new healthy products, he said.
“They’ll probably be leveraging on Coke’s distribution abilities more,” Berkovitz said. “They’ll be able to get a new product into the stores, into the coolers — better point of production store displays where people can see it.”
One thing that could hinder success of a new product is taste quality.
“If a new product in any way compromises taste, it will go nowhere,” Clarke said.
Coke is experimenting internationally with new products such as:
Qoo – In Japan, Qoo’s cartoon mascot and light juice flavors appeal to children, while the added vitamin C and calcium appeal to parents.
Aquarius – This mineral water flavored with citrus is being marketed in France towards athletes to rehydrate the body.
Lift – Marketing began in the South Pacific for this fruit- flavored energy drink; popularity is now spreading through Asia.
Georgia Coffee – A ready-to-serve canned coffee drink, hugely popular in Japan, that can be served hot or cold.
Water Salad – Japan’s vitamin-enhanced meal in a can, marketed primarily toward women.