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Market Data 30.01.2025

Campa Cola’s aggressive pricing disrupts Indian soft drinks sector, says GlobalData

The Indian soft drinks sector is currently experiencing a notable disruption due to the price war initiated by Campa Cola. With the incumbent market leaders, Coca-Cola and PepsiCo joining the price war, …

Campa Cola’s aggressive pricing disrupts Indian soft drinks sector, says GlobalData
(Photo: confructa medien GmbH)

The Indian soft drinks sector is currently experiencing a notable disruption due to the price war initiated by Campa Cola. With the incumbent market leaders, Coca-Cola and PepsiCo joining the price war, it is an all-or-nothing war for a share of the consumer’s wallet in the Indian soft drinks sector, says GlobalData, a leading data and analytics company.

Parthasaradhi Reddy Bokkala, Lead Consumer Analyst at GlobalData, comments: “The Campa Cola brand, once a common sight across India when Coca-Cola and PepsiCo did not operate in the country due to regulations, was revived in 2022 by Reliance Retail. Backed by the deep pockets of its parent, Reliance Industries, the company embarked on an aggressive pricing model to capture market share.

“With the INR10 (USD 0.12) price of a 200 ml cola bottle and INR 20 (USD 0.24) for a 500 ml bottle, Campa Cola has undercut PepsiCo, Coca-Cola, and other companies’ prices by 50 %, as 200 ml bottles of colas are generally available at a price of INR20 (USD 0.24). To counter this, Coca-Cola and PepsiCo launched promotional pricing for their larger bottles. This led to a lull in the price war as Campa Cola’s distribution reach was still low.”

Francis Gabriel Godad, Consumer Business Development Manager, GlobalData India, notes: “The impact on market leaders Coca-Cola and PepsiCo’s market share was low due to the lack of distribution reach for Campa Cola. Thanks to the gradual increase in Campa Cola’s distribution reach, the situation changed in recent quarters as the aggressive prices and expanded distribution disrupted the operations of Coca-Cola and PepsiCo. The two companies have been forced to withdraw from the status quo and increase promotions on their products. For instance, Coca-Cola recently launched a 350 ml bottle (150 ml free) of its flagship Coca-Cola brand at INR 20 (USD 0.24).”

Godad continues: “The predatory pricing has also affected the volumes of non-cola categories and brands. For instance, PepsiCo’s Tropicana and ITC’s B Natural brands suffered volume losses due to the expanding price differential between nectars and colas.”

Reddy concludes: “The price war in the Indian soft drinks sector is a multifaceted issue driven by aggressive pricing strategies, shifting consumer preferences, economic pressures, and a growing focus on health. As companies continue to adapt to these dynamics, the competition is likely to intensify, with potential long-term implications for brand loyalty and market positioning. With all the major players having deep pockets, the market is in for a long-drawn price war, which can lead to a consolidation in the market, as smaller players may not be able to sustain in a long-drawn price war.”

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