Mexico
Dating back to 1897, Coca-Cola's international products have long been sold in Mexico. Today Coke controls 60% of the Mexican soda market, far ahead of Pepsi with 30%. In fact, Mexican president Fox’s last job before becoming a politician was serving as president of the Coca-Cola Corporation of Mexico and Latin America.
After Fox’s victory, Coca-Cola began bottling water from the richest aquifer in the Chiapan town of San Cristóbal de las Casas, an ecological reserve administered by a conservation group Pronatura, which receives money from Coca-Cola Mexico. In 2004, the Coke plant in San Cristóbal de las Casas used 107,332,391 liters of water—about as much as 200,000 homes would use.
In a country where more than 12 million citizens are without access to potable water, Mexican groups have launched a boycott against Coca-Cola primarily motivated by Coke’s growing domination of Mexican water.
Yet many Mexican revolutionaries continue to be heavy consumers of Coca-Cola. One Mexican boycott leader is reported to have said “We have a way to get rid of Coke. We will drink every last bottle.”
India
Although India's soft-drink consumption is a paltry 7 servings per capita annually, Coke has come to realize that 1.1 billion Indian drinkers may well represent the market with the greatest potential for sales growth. To stimulate sales to the Indian masses, Coke has cut its prices aggressively from 15% to 25% starting 3 years ago.
The company also promoted its local marketing director, Sanjeev Gupta, to operations chief for India. Straight-talking and hard-driving, Gupta persuaded Coke's head office in Atlanta to customize its approach in India. Gupta then revitalized a local Coke brand Thums Up, pushing Coke's local brands as much as Coca-Cola. After US$3.5 million was spent on advertising and distribution, Thums Up is now India's second-leading soft drink.
Gupta launched a 200-millilitre drink selling for 10 cents a bottle, and dropped the price of a 300-millilitre bottle to 17 cents from 24 cents. These price cuts were key to boosting sales and was aimed at rural areas and lower-income urban markets where the little bottles and the modest price tags were big hits.
Five years ago Coke introduced Kinley bottled water into India, which has grown to a leading market share of 37% by building on Coke's Indian distribution network. Coke is now test-marketing its ready-to-drink coffee in India, building on its successful launch in Japan.
Ironically, some Indian farmers are using Coke as a low-cost pesticide. Instead of paying hefty fees to international chemical companies for patented pesticides, hundreds of cotton farmers have used Coca-Cola sprays that are about 500 times cheaper than popular Indian pesticides.
After years of losing money in India, Coke has turned the corner and is now profitable in that emerging market. So much so that Coke has invested over $150 million more to expand its bottling and distribution network in India, making India Coke's second-largest Asian investment after China.
Sources: Hoovers stock analysis, The World Factbook, John Vidal's November 2, 2004 article on Coke's use as a pesticide in The Guardian
