Page 208 - DMGT509_RURAL MARKETING

Unit 10: Distribution Strategies for Rural Market

Notes
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Case Study Coco-Cola In India: Innovative Distribution strategies

with 'RED' Approach

ver the years, CCI had built its strong distribution system consisting of company-
owned, franchised and contract manufacturers and distributors. With its focus on
Oeffective execution, in 2006, CCI introduced `Right Execution Daily' (RED), a
distribution plan which boosted the sales of its products in urban markets through efficient
brand displays and visibility programs. India, being a predominately rural economy and
all major MNCs targeting the potential rural markets with their products, CCI was no
exception. It made its presence felt in the rural markets of India with its unique marketing
and distribution strategies. It further plans to implement RED in these markets. However,
the question to be answered is-what are the challenges that the company might face in
reaching out to the customers in Indian rural markets and how far can RED be extended to
rural India?
Coca-Cola, the world famous and best tasting cola product originated as soda fountain
beverage in 1886, in Atlanta, US. TCCC is the largest beverage company in the world with
its operations spread in more than 200 countries. It leads the beverage markets in the
world benefitting from its broad reach and scale. It markets nearly 500 global brands such
as Coca-Cola, Sprite, Fanta, Maaza, etc., and more than 3,000 beverage products including
sparkling cola drinks, juices, sports drinks and energy drinks. With the largest product
portfolio, Coca-Cola allows the people across the globe to enjoy its beverages for about
1.6 billion times a day. The company has been able to create a global reach with local focus
through its `Coca-Cola System' strength, consisting of the company, bottling partners and
customers (Exhibit I). Coca-Cola manufactures the concentrates, beverage bases and syrups
and sells them to the bottling partners. It owns the brands and focuses on marketing the
brands to reach the consumers. It works with around 300 bottling partners ranging from
international, regional to family-owned operations, responsible for producing, packaging,
distributing and merchandising its products worldwide forming the world's largest
beverage distribution system. Its customers are retail stores, restaurants, drug stores, etc.,
who in turn sell its products to end consumers.
Pedagogical Objectives:
 To understand the wide spectrum of Coca-Cola India's distribution strategies vis-à-
vis its target segments and explore if it has adopted different distribution strategies
for different target segments

 To understand Coca-Cola India's 'Right Execution Daily' (RED) and analyse how its
effectiveness has become fundamental to Coca-Cola India's growth

 To debate on the challenges Coca-Cola India might face in reaching out to the Indian
rural markets.
Even though India has one of the fastest growing economies and continues to move
forward with market-oriented economic reform, it is constrained by inadequate
infrastructure, a cumbersome bureaucracy, corruption, labor market rigidities and
regulatory and foreign investments.
Coca-Cola is the most valued brand name on the face of earth according to Daniel Workman.
Interbrands Global Brand Scorecard for 2003 ranked Coca-Cola the number one brand in
Contd...

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