Coca-Cola to launch fruit-based drinks

Playing its health card, Coca-Cola is in the process of launching three fruit-based drinks this summer. The company is expected to launch two products under the Minute Maid brand, and a mango shake in the dairy segment under the Maaza brand by June this year.

“Coca-Cola India is currently test marketing Minute Maid Apple Juice and Minute Maid Mixed Fruit juice in Kolkata. Based on the response, we will take a call to roll it out in other parts of the country,” confirmed a Coca-Cola India spokesperson in response to an email. The spokesperson, however, declined to comment on the company’s entry in the dairy segment with a mango shake under the Maaza brand.

Coca-Cola is not present in the dairy segment elsewhere in the world. India would be its first test-ground for the segment when it launches the mango shake. Coke is the beverage sponsor of the upcoming Commonwealth Games. Analysts say it would leverage these launches during the Games to capture consumers’ mindshare.

“Getting into allied products (mango shake) is a well-thought move since it will require only re-constituting the existing product (the pulp left from Maaza formation can be re-processed into shake). There is more synergy into it,” said an analyst. The only challenge would be a better chilled supply chain to reduce spoilage, as dairy products are more temperature-sensitive than soft drinks and have shorter shelf life.

Cola companies, note analysts, are launching fruit-based drinks as people have become more health conscious. Even FMCG companies are entering the juice segment. In the past, Pepsi had launched Tropicana and Nimbooz. Dabur is bullish on its Real range. Parle Agro also launched LMN (lemon drink). Wipro Consumer recently launched few fruit variants of Glucovita (glucose concentrate) and it wouldn’t be surprising if Wipro moves from juice concentrate to ready-to-drink juice soon.

Anand Ramanathan, sector analyst from KPMG, reasons: “Margins are better in juice-based drinks than carbonated drinks, as juice is a premium segment while carbonated drinks is a mass segment. Juice will be the future growth driver for cola companies.”

Carbonated drinks is a Rs 14,720-crore market in India, while juice is a Rs 2,670-crore market. But the juice segment is growing faster than carbonated, according to analysts.

Coca-Cola, according to a source close to the development, is also considering a Guava variant and has a plan to expand Minute Maid into a full juice range in the coming two years.