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Sandy Li

Coca-Cola China is projecting record sales growth this year after launching its highest number of new products yet and embarking on an aggressive marketing strategy.

Scott Price, director and regional manager for Hong Kong, Macau and Mongolia, said 19 of a projected 28 new beverage products, packages, or flavours had already been introduced.

Last year, the company brought only eight new products or packages to the market, and five in 2000.

He said the new products had generated a strong response when they were put on sale this year. For instance, Qoo had accounted for 38 per cent of market sales for juice since it was launched last October. Mr Price said the company distributed three brands in the segment.

More than 20 brands in the juice category were available.

In the water category, the company's Bonaqua brand had doubled market share to 14.6 per cent from 7 per cent last month, he said. There were at least 10 brands of water in the market.

Coca-Cola, the backbone of the group, had 60 per cent of sales in the carbonated soft-drink category, he said.

Mr Price expects the World Cup will boost beverage sales considering there will be many home parties during the period.

He said the company offered 100 stock-keeping units, representing different flavours and packaging, under 15 brands on the market.

Hong Kong's drinks and beverage market was one of the toughest in the world, given the ample choice on offer. Last year, for example, more than 800 stock-keeping units under 300 new brands had been introduced in the SAR.

Competition in the local drinks and beverage market was so strong because it was extremely easy for new entrants to introduce their products into Hong Kong, which had well-developed distribution channels such as supermarkets.

'We see that pace as continuing,' he said.

To fend off competition required a heavy ongoing investment in consumer research and continued introduction of innovative products.

'We almost have to advertise every single brand now but we didn't need to do this in the past,' he said. Previously the company had focused its advertising on a selected number of brands.

Mr Price attributed better than expected sales amid unemployment and prolonged deflation mainly to an aggressive marketing strategy.

Many companies had decided to cut their marketing budgets this year, he said.

But Coca-Cola chose to increase its advertising budget by a double-digit figure.

Apart from advertising, he said the company had allocated HK$700,000 for a seven-month lucky draw programme in which an education prize worth HK$100,000 would be awarded each month.

Despite keen competition, he said the market still had huge potential for further development.

Given everyone needed two litres of liquid a day, he said only 25 per cent came from commercial drinks and beverage. The balance came from tap water, coffee or tea.

'We don't focus on just increasing the number of consumers but on how to increase their daily purchases,' he said.



Coca-Cola expects record sales growth on back of new products