Something's brewing: Coca-Cola to 'experiment' with alcoholic drink

Coca-Cola has always focused entirely on nonalcoholic beverages, and this is a modest experiment for a specific slice of the market

Coca-Cola Co.’s Japan unit plans to introduce a fizzy alcoholic drink in the country, in what an executive described as the first alcoholic product in the company’s history.

Jorge Garduño, president of Coca-Cola’s Japan unit, said in an article posted on the company’s website that it is “going to experiment” with a canned drink that contains alcohol—a product category known as chu-hai in Japan.

The chu-hai drinks are often made with a distilled grain-based alcohol called shochu and flavored, carbonated water. Flavors range from strawberry to ice tea and cream soda.

Coca-Cola’s Japan unit has long sold many drinks that aren’t available elsewhere, including various teas and coffees and a laxative version of Coke called Coca-Cola Plus.

“We haven’t experimented in the low-alcohol category before, but it’s an example of how we continue to explore opportunities outside our core areas,” Mr. Garduño said.

He added: “This is unique in our history. Coca-Cola has always focused entirely on nonalcoholic beverages, and this is a modest experiment for a specific slice of our market.”

A spokeswoman for Coca-Cola Japan confirmed Wednesday that low-alcohol products are being “considered as an experimental approach.” She declined to give details of the proposed product, including when it might go on sale, and declined to make Mr. Garduño available for an interview.

Japan has a highly competitive beverage market, where companies can introduce as many as 100 new drinks a year. Canned chu-hai drinks are ubiquitous, sold in convenience stores, vending machines and eateries. Until recently, most of the varieties had low-alcohol content of 3% to 4%. But stiffer drinks with alcohol content of 8% or more have been growing rapidly. A 350-milliliter can usually retails for less than ¥200 ($1.90).

If Mr. Garduño carries through with his plan, Coca-Cola Japan will be entering a crowded market dominated by local brands from companies such as the beverage units of Suntory Holdings Ltd. and Kirin Holdings Co.

According to Suntory, the total market in Japan for canned ready-to-drink alcoholic beverages has grown for 10 consecutive years. It grew 9% in 2017 to the equivalent of 183 million 24-can cases. About a third of those had alcohol content of at least 8%, Suntory said
The Wall Street Journal