Chapter 1

INTRODUCTION

INTRODUCTION

About Fruit juices market

Different companies are now looking at different pack sizes and price points. New entrants are
also expected to join the fray in the Rs 500-crore (Rs 5 billion) organized fruit beverage market
(nectars, drinks and juices combined).
What's making all these players gung-ho about fruit beverages? For one, the fruit drink market
(juice accounts for 30 per cent, nectar is 10 per cent and fruit drinks are 60 per cent of the market
today) has grown at a 20 per cent to 25 per cent rate.
Of this, the more expensive juices segment has grown at a 40 per cent rate this year. It accounted
for only 15 per cent of the fruit beverage market three years back. Consumer habits have
changed drastically. They are looking for healthier options and nutritional value in the food they
buy today.
But it's not just the health fad that has led to the growth spurt. Cola sales fell dramatically after
the pesticide controversy and this seems to have benefited the fruit beverage industry. Soft
carbonated drinks (colas) grew 17 per cent in 2002 but fell 15 per cent in 2003.

What also made the market work is the fact that tetrapaks offered a solution to provide fruit juice
practically fresh and preservative free.
The proliferation of supermarkets and malls in metros and mini-metros (key markets for this
category), added to the growth story as well. And then there is the income factor.
The other factors that have helped are the different pack sizes that players started offering in the
last year. Tropicana launched a 500 ml pack at Rs 25 compared to a one litre pack for Rs 76.
These new price points and packs are aimed at getting more consumers to try the new product,
and in turn increase the consumer base.

All of this has resulted in increased in-home consumption of juices, which has gone up from 30
per cent three years back to almost 80 per cent today. Consumers perceive this as the next best
thing to having a fresh fruit. Convenience is no longer the selling point, the natural taste &
essence matters. The Companies have big plans for the future. Dabur, which currently has a 55
per cent market share, wants to launch more Indian fruits and even fruit and vegetable juice
combinations in the near future. It is also trying to bring down prices.
So, it has launched Coolers 15 per cent cheaper than Real because it has a lower pulp content.
And by setting up a food processing plant in Siliguri, West Bengal, Dabur will source fruits
directly from farmers and cut down raw material or pulp costs, which comprise almost 30 per
cent of the finished product.
Similarly, other players like Godrej are also looking at launching new variants including
combinations by year-end. Parle Agro, which has been experimenting with sugarcane juice for
some time now, has launched mango Fruity in 65 ml packs in Pune, Gurgaon and Mumbai for Rs
5. A year back, it extended the Fruity brand into pineapple and orange variants as well as
launching it in 250 ml and one-litre PET bottles.
Pepsi's Tropicana has tied up with equestrian sports and polo clubs to build bridges with the
well-heeled young adults. Its recent sampling exercise included an interactive quiz reaching out
to 200,000 students from 150 schools in Delhi.

Health drinksAccording to the research report, the Indian health drinks market was estimated at around Rs.
216 Billion in 2008 and is forecast to grow at a CAGR of around 15% during 2009-2012. The
report covers various factors driving the growth of health drinks market in India.
India has witnessed radical shift in consumption of health drinks over the recent past. Fast
expanding middle class population that is currently around 350 Million, increased urbanization
and rising disposable income are some of the major reasons contributing to this change. Besides
this, growing health consciousness among Indias young population has brought about a
revolution in the Indian health drinks market. It has been seen that cola sales have fallen
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dramatically due to rising health concerns and this seems to have benefited the countrys noncarbonated drinks market such as energy drinks and juices.
There is a greater awareness of the functional benefits of health beverages and a greater
willingness to pay a premium for such beverages. With these strong drivers of growth, it is not
surprising that the beverage industry in India has begun responding with products that are
marketed clearly on a health and wellness platform.
The segment level analysis shows that the highest growth will be seen in the fruit juice market,
which is forecast to growth at a CAGR of around 30% in value terms during 2010-2012. It will
be closely followed by the energy drinks segment at a CAGR of around 29% during the same
period.
There is a greater awareness of the functional benefits of health beverages and a greater
willingness to pay a premium for such beverages. With these strong drivers of growth, it is not
surprising that the beverage industry in India has begun responding with products that are
marketed clearly on a health and wellness platform.

Why market demand of energy drinks & fruit juices are growing in Indian market
In the recent years, India has been observing a sweeping shift in consumption of non-alcoholic
drinks, like energy drinks and juices. The growing middle class that currently is around 350
million, rising urbanization and increase in purchasing parity are some of the primary reasons,
prompting this change. Indian non-alcoholic drinks market which in 2008 stood around Rs 216
billion is projected to grow almost by 15% during 2010-2012.
Furthermore, rising health consciousness among the masses has increased the popularity of these
non-alcoholic drinks. And as expected, cola sales have been plummeting due to rising health
issues and this seems to have boosted the growth of country's non-carbonated drinks like energy
drinks and juices.
As per the segment level analysis, fruit juice market would witness the highest growth around 30
percent in value terms in 2010-2012, followed by energy drinks segment. In these changing
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times, a greater awareness towards health beverages and energy drinks is being witnessed and the
best part being people don't mind coughing up a little more for them. Indian companies are
undoubtedly cashing in on the health and wellness understanding/awareness among the masses
by launching products that meet their requirements.

About Carbonated Drinks

Juices are often consumed for their perceived health benefits. For example, orange juice is rich in
vitamin C, folic acid, potassium, is an excellent source of bioavailable antioxidant photochemical
and significantly improves blood lipid profiles in people affected with hypercholesterolemia.
Prune juice is associated with a digestive health benefit. Cranberry juice has long been known to
help prevent or even treat bladder infections, and it is now known that a substance in cranberries
prevents bacteria from binding to the bladder.
The high sugar content of fruit juices is often not realizedmany fruit juices have a higher sugar
(fructose) content than sweetened soft drinks; e.g., typical grape juice has 50% more sugar than
Coca Cola.
Fruit juice consumption overall in Europe, Australia, New Zealand and the USA has increased in
recent years, probably due to public perception of juices as a healthy natural source of nutrients
and increased public interest in health issues. Indeed, fruit juice intake has been consistently
associated with reduced risk of many cancer types, might be protective against stroke and delay
the onset of Alzheimer's disease.
The perception of fruit juice as equal in health benefit to fresh fruit has been questioned, mainly
because it lacks fiber and has often been highly processed. High-fructose corn syrup, an
ingredient of many juice cocktails, has been linked to the increased incidence of type II diabetes.
High consumption of juice is also linked to weight gain, but fruit juice consumption in moderate
amounts can help children and adults meet daily recommendations for fruit consumption,
nutrient intake and calories.
A number of packaged juices contain added sugars and sweeteners. These make them more liked
by children but the extra sugars can contribute to childhood obesity and infantile diabetes.
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Diabetes is a very common illness in India. Once a child develops a taste for extra-sweet
packaged juices, it is hard for them to accept less sweet but natural juices. Most juices contain
Vitamin C, and some contain added fortifiers like calcium, Vitamin A and Vitamin C and this can
beneficial for children. However, juice with fortified calcium is not a replacement for milk. Milk
contains a number of other ingredients that are good for children. Fruit juices must not be used as
a substitute for milk.
Packaged fruit juices contain none of the natural fibers that are in fruit, unless they contain pulp
also. Fiber is an important part of children's diets as it improves digestion. The act of washing,
peeling, biting and chewing fruit teaches our children important physical skills. They young
fingers learn how to be flexible and their mouth learns how to mash food before swallowing it.
By taking longer to consume the same amount of calories, it reduces overconsumption and keeps
them healthy. Behaviorally, eating a whole fruit helps children combat the need for "instant
gratification". Instant gratification is the need to get satisfaction immediately and always. While
poking open a fruit juice container seems efficient, we are teaching our kids that happiness
comes out of a package.
Pediatricians recommend that juices must not be introduced into infant diets till they are 6
months old. Packaged fruit juices, if bought correctly, do help our children's hydration as they
contain a lot of water.
These are packaged products that have a fruit sounding name or a fruity logo, but seldom contain
100% fruit juice. They are almost always made with artificial flavors, added synthetic sugars.
They may also be aerated/carbonated
Parents often think that packaged fruit juices and drinks have the same benefits as fruits and feed
them to their children. Often there is also overconsumption as no limit is set on what is perceived
to be a healthy source of nutrition. Unfortunately, the truth may be far from it.

BEVERAGE

What is beverage ?
A drink, or beverage, is a liquid specifically prepared for human consumption. Inaddition to
basic needs, beverages form part of the culture of human society. Or any liquid suitable for
drinking; "may I take your beverage order?"or A liquid to consume, usually excluding water; a
drink. This may include tea, coffee, liquor, beer, milk, or soft drinks.

Types of beverage
The various types of beverage are:

Alcoholic beverages
Non-Alcohol beverages
Soft drinks
Fruit juice
Hot beverages
Other

1. Alcoholic beverages
An alcoholic beverage is a drink containing ethanol, commonly known as alcohol, although in
chemistry the definition of an alcohol includes many other compounds. Alcoholic beverages,
such as wine, beer, and liquor have been part of human culture and development for 8,000 years.
2. Non-alcohol beverages
Non-alcoholic beverages are drinks that would normally contain alcohol, such as beer and wine
but are made with less than .5 percent alcohol by volume.
The category includes drinks that have undergone an alcohol removal process such as nonalcoholic beers and de-alcohol zed wines.
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Non-alcoholic variants:

Low alcohol beer

Non-alcoholic wine
Sparkling cider

3. Soft drinks
The name "soft drink" specifies a lack of alcohol by way of contrast to the term "hard drink" and
the term "drink", the latter of which is nominally neutral but often carries connotations of
alcoholic content. Beverages like colas, sparkling water, iced tea, lemonade, squash, and fruit are
among the most common types of soft drinks, while hot chocolate, hot tea, coffee, milk, tap
water, alcohol, and milkshakes do not fall into this classification. Many carbonated soft drinks
are optionally available in versions sweetened with sugars or with non-caloric sweeteners.
4. Fruit juice
Juice is a liquid naturally contained in fruit or vegetable tissue. Juice is prepared by mechanically
squeezing or macerating fresh fruits or vegetables without the application of heat or solvents. For
example, orange juice is the liquid extract of the fruit of the orange tree. Juice may be prepared
in the home from fresh fruits and vegetables using variety of hand or electric juicers. Many
commercial juices are filtered to remove fibre or pulp, but high pulp fresh orange juice is a
popular beverage. Juice may be marketed in concentrate form, sometimes frozen, requiring the
user to add water to reconstitute the liquid back to its "original state"
5.Hot beverages
Hot beverages, including infusions. Sometimes drunk chilled.

Coffee-based beverages
Cappuccino
Coffee
Espresso
Caf au lait
Frapp
Flavored coffees (mocha etc.)
Fatte
Hot chocolate
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Hot cider
Mulled cider
Tea-based beverages
Flavoured teas (chai etc.)
Green tea
Pearl milk tea
Tea
Herbal teas
Yerba Mate
Roasted grain beverages
Sanka

6.Other
Some substances may either be called food or drink, and accordingly be eaten with a spoon or
drunk, depending on solid ingredients in it and on how thick it is, and on
Preference:

Soup
Yogurt

OVERVIEW OF THE INDUSTRY

The beverage market is worth $55 billion worldwide.
The tides are turning for many beverage categories. While the carbonated soft drink and beer
categories are merely treading water with flat sales, the energy drink category is surging ahead
like never before. Bottled water, ready-to-drink coffee, ready-to-drink tea and sports drinks
follow close behind with substantial sales increase- drinks without added sugar, no beer, along
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with developments in juice drinks and dairy-based drinks, are helping to turn around sales in
these categories. What follows is a category-by-category look at the state of the beverage
industry, including the top brands, new products, innovations and future trendsetters.
In order to be successful in the marketplace, one has to think in terms of health innovation,
flavour innovation, ingredient innovation and specific age groups. These are the factors that will
shape the future of the beverage industry.
Todays consumers are concerned with overall health and wellness. As a result, there is
significant impact on food and beverage purchases. Many studies have shown that consumers are
as concerned with good health as they are about maintaining a high quality of life.
Do you know what type of new beverage consumers are most likely to try? Do you know where
they are most likely to pick those products up? Do you know why?
Beverage Industry wanted to know the answers to these questions and to delve deeper into the
ever-increasing number of new product launches in the beverage market. The soft drink
industry is training people to seek out new products, even the big guys are coming out with
limited-edition flavours, and consumers are beginning to see that there is more flavour activity
going on in the category. Whether that really nets anybody any sales gains is another thing, but it
is teaching consumers to seek out and try new products. Its also trying to create some
excitement there.
In spite of several challenges and restrictions faced by this industry, it is a roll like never before.
Customer preferences may have shifted, but they are still always on the lookout for a can of
coke or a new flavoured drink to quench their thirst.
INDIAN BEVERAGE MARKET

The size of the Indian food processing industry is around $ 65.6 billion, including $20.6 billion
of value added products. Of this, the health beverage industry is valued at $230 million; bread
and biscuits at $1.7 billion; chocolates at $73 million and ice creams at $188 million.

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The size of the semi-processed/ready-to-eat food segment is over $1.1 billion. Large biscuits &
confectionery units, Soya processing units and starch/glucose/orbital producing units have also
come up, catering to domestic and international markets.
The three largest consumed categories of packaged foods are packed tea, biscuits and soft drinks.
The Indian beverage industry faces over supply in segments like coffee and tea.
However, more than half of this is available in unpacked or loose form. Indian hot beverage
market is a tea dominant market. Consumers in different parts of the country have heterogeneous
tastes. Dust tea is popular in southern India, while loose tea in preferred in western India. The
urban-rural split of the tea market was 51:49 in 2000.
Coffee is consumed largely in the southern states. The size of the total packaged coffee market is
19,600 tonnes or $87 million. The total soft drink (carbonated beverages and juices) market is
estimated at 284 million crates a year or $1 billion. The market is highly seasonal in nature with
consumption varying from 25 million crates per month during peak season to 15 million during
off-season. The market is predominantly urban with 25 per cent contribution from rural areas.
Coca cola and Pepsi dominate the Indian soft drinks market. Mineral water market in India is 65
million crates ($50 million) industry. On an average, the monthly consumption is estimated at 4.9
million crates, which increases to 5.2 million during peak season.

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RECENT ISSUES
1. Xtazy, another energy drink for the Indian market
The Indian market for energy drinks was estimated recently to have a size of Rs 500 crores,
about 90 million Euros. The market which is so far dominated by Red Bull, is attracting various
new players which want to get a share in a growing business.
One of the aspirants is Xtazy, an energy drink from the US. Xtazy is the fourth largest energy
drink in the US, says Rohan Malhotra, Managing Director of R. M. Indian Liquor Pvt. Ltd., the
exclusive importer for Xtazy. Malhotra has launched Xtazy already in Eastern India, and was
looking now for a distributor in the Delhi area, when FII spoke to him during IFE fair in Delhi
recently.
In order to take on Red Bull and get a share of 20% from their business, Malhotra wants to offer
better conditions to distributors. We provide a margin of 6-8% to a distributor, who thus can
earn about Rs 6 a can, Malhotra says. This is more than what Red Bull offers which is only
about 2 3 Rs per can. Xtazy is available in cans of 350 ml, thus more than the usual 250 ml of
other energy drinks, and will be priced with a MRP of Rs 85. Four variants are offered,
Cranberry Blast, Sugar Free Passion Fruit- Pineapple, Orange Blast and Lime Blast.
Malhotra has planned several marketing measures to promote Xtazy, like PoS actions, coupons
and direct marketing in a first round, and night parties in a second round. In marketing
communication, he is highlighting not only the variants, but also health effects as the USPs of
Xtazy, which are derived from ancient herbs used in the drink like gingko and guarana. The
extract of gingko biloba leaf has been shown to dilate blood vessels and has the ability to
increase peripheral blood circulation, especially to the brain, the company writes in a leaflet.
Guarana from Brazil would serve to promote weight loss by increasing the metabolic rate and
reducing the appetite.
Besides the US, Malhotra says, Xtazy would be marketed also in Israel, Ukraine and in Turkey
and would soon be launched in China.

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2. Australia-based "Aromas" launches first coffee store in India.

Australia-based "Aromas," one of the leading coffee chain shops, launched its first caf outlet in
India at Hiranandani, Poway, and Mumbai. The company also tied up with Ideal Hospitality
Private Ltd (IHPL), which would own the brand in the country and south-east Asia.
Jayant Mahiskar, chairman and MD, IHPL, said, "Aromas is being launched keeping in mind the
true coffee connoisseurs. We aim at targeting the youth and corporate at our outlets and Poway
with a mix of residential and office complexes was a natural choice.
The coffee has been created from selection of the original beans and blended to suit all tastes.
Aromas ensures freshness and fullness of flavour." According to the agreement with Aromas,
IHPL will pay about 1.5% of the gross revenue earned.
Further, the company has decided to invest about Rs. 50-75 crores in the next three years to
expand its footprint with 99 outlets in India.
3. China rejects Coke bid to take-over major juice maker China has rejected Coca-Cola's $2.5
billion bid to buy a major Chinese juice maker. The purchase of Huainan Juice Group Ltd would
have been the biggest foreign acquisition of a Chinese company to date. The proposed purchase
was rejected on anti-monopoly grounds, the Chinese commerce ministry announced on its
website.
Coca-Cola's bid in September prompted an outcry by nationalists who urged the government to
bar foreigners from acquiring one of China's most successful home-grown brands. Rival juice
producers warned that the acquisition would give Coca-Cola too dominant a position in China's
beverage market. A Coca-Cola spokesman in Hong Kong learned of the rejection of the sale had
no immediate comment. Huainans founders and major shareholders already had endorsed the
sale.
If Coke were to take over Huainan, it will dominate the soft drinks market in China, which not
only hurts consumers, but also other sector participants. Huainan controls more than a tenth of
the Chinese fruit and vegetable juice market that grew 15% last year to $2 billion. Coca-Cola has
a 9.7% share and dominates in diluted juices.

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According to analysts China's ruling on Coke could cut both ways in that Chinese firms that have
been making increasingly high profile acquisitions abroad may run into trouble of their own.
3. Pepsi's Slice kicks off the new season with 'Aamsutra' PepsiCo's popular mango juice
drink brand- Slice kicks off the 2009 season with its new 'Aamsutra' concept.
According to Home Battiwalla, business head, juice & juice drinks, PepsiCo India, Slice had
seen powerful consumer momentum post the re-launch of 2008. The new winning formulation
has been appreciated by consumers. Aamsutra has driven strong disruption in the juice and juice
drink category. All of this has made Slice the fastest growing mango drink brand in the country.
"South India is the lead market for mango drinks in the country. Andhra Pradesh is the biggest
mango market and also the fastest growing market for Slice and mango drinks in the country.
Tamil Nadu is amongst the top three states and Slice is the market-leader in Tamil Nadu," he
added Pepsi has now opted for a new brand ambassador, Katrina Kaif.
"The creative thought behind the new communication was to further enhance the Slice
experience into dimensions of pleasure, sensuality and indulgence. Last year's commercial was
about enumerating the principles of 'Aamsutra' or the art of experiencing pure mango pleasure
with the new Slice. This year, the commercial portrays the next level to bring alive the mango
indulgence, stated Hari Krishnan, Vice President, JWT.
The company has now opted for a 360 multimedia campaigns involving digital, print, radio,
impact outdoors and sampling in core markets.
4. Parle Agro launches lemon flavoured drink "LMN"
Parle Agro, one of the leading food & beverage companies in India, has launched a new fruitbased lemon drink LMN in the non-carbonated segment. The new brand is a natural lemon juice
drink and the only brand in India with a taste closest to homemade, fresh lime water (Nimbu
pani). According to the company, LMN will offer consumers a healthy, refreshing drink with the
goodness of vitamin C. Every summer, the Indian beverage market has seen cola majors battle it
out. This summer, the launch of LMN will see the cola wars taking a back seat and the battle
spilling over to the non-cola segment, to be more precise in the nimbu paani category. PepsiCo
India last week launched a nimbu pani drink, Nimbus, under the 7Up brand. On the occasion of
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LMN's launch, Nadia Chauhan, joint managing director and CMO, Parle Agro, said, "Nimbu
pani has traditionally been India's most commonly consumed cold beverage. In fact the idea of a
branded lemon drink is so simple that you would wonder why nobody thought of it earlier. The
challenge for us was packaging a natural product while retaining its fresh, original taste
throughout its shelf life."
LMN will be available in 110 ml Tetra, 200 ml Tetra and 500 ml PET packs priced at Rs 5, Rs 10
and Rs 23 respectively. The company aims to touch a turnover of Rs 3000-3500 crores by 2011.
The company will target both (youth and adult) segments of consumers to turn them into branded
consumers of nimbu pani. Besides this LMN will also target an emerging segment of consumers
who are looking for a healthy and refreshing beverage in the country. "For the last 20 years, Parle
Agro has been the market leader in fruit based beverages, we have constantly worked keeping in
mind Indian preferences while formulating products that cater to the Indian palate. It is without
any doubt that only an Indian company can understand what real nimbu pani tastes like and what
the Indian consumer wants in a packaged offering," Chauhan added.
Further, the company claims that packaged nimbu pani will have tremendous growth potential,
higher than other packaged drinks mainly because of a major shift in consumer behaviour. Today,
the beverage consumer is looking for hygiene, convenience, refreshing taste, affordability and
year-round availability. The name LMN is derived from the SMS version of the word lemon.
Parle Agro also owns other fruit drink brands like Fruity, Appy Fizz and packaged drinking
water, Bailey.
5. PepsiCo launches 'Nimbus,' packaged lemon juice with no fizz and artificial flavours
PepsiCo India has launched its packaged nimbu paani, Nimbus, under its 7Up brand.
The home-made nimbu paani or lime juice has been specially created to suit Indian tastes.
The lemon juice, no fizz and artificial flavours, is available in trendy, convenient packs.
The drink offers great value to consumers in three packaging formats of 200 ml returnable glass
bottles (RGB), 350 ml PET and 200 ml Tetra attractively priced at Rs 10, Rs 15 and Rs 10,
respectively.
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According to Ms Punita Lal, Executive Director- Marketing, PepsiCo India, Nimbus, is specially
developed to suit Indian tastes and preferences.
"Nimbooz is an affordable offering for consumers on the go because of its ready-to-drink format
that is both convenient and hygienic. The proposition of the Indian refresher perfectly captures
the mass appeal of this product and will certainly drive consumer connect, stated Ms Alpana
Titus, Executive VP-Flavours, PepsiCo India.
PepsiCo has drawn up an intensive consumer activation campaign to market Nimbus.
The 360 degree marketing communication plan will revolve around building awareness through
multi-city launches and road shows, comprehensive 3D activation, leveraging Out-of-Home
(OOH) media, radio, press and outdoors. Aggressive trial generation and sampling initiatives will
also be taken forward across major cities of the country. A special 'Nimbooz Highway Gadi' has
been created that will visit the four major highways connecting Delhi to SITAPUR, LUCKNOW,
Agra to drive trails and consumer education.
6. Coke launches fruit-flavoured Fanta Apple nationally
After successfully introducing it in southern markets last year, Coca-Cola India has launched its
fruit-flavoured soft drink 'Fanta Apple' nationally. The product is available in 200 ml and 300 ml
returnable glass bottles and also in 500 ml PET pack, priced at Rs 8,Rs 10 and Rs 22
respectively.
During the Fanta Apple launch in October 2008, Venkatesh Kini, marketing vice-president,
Coca-Cola India, said that the company had planned to reach about 3.5 lakh customers with
sample apple flavoured drink to extend its market leadership in the fruit flavoured segment in
Andhra Pradesh and Tamil Nadu.
"As per consumer research, we have found that after orange, apple is the most preferred fruit in
the country and Fanta Apple has been developed specially for the Indian palate,"
Kini said on Monday. According to experts, the nationwide launch of Fanta Apple is a part of the
company's $250 million business plan for the country.

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Fanta Apple is the second flavour after Fanta Orange under "Fanta" brand of the company. "We
have had an excellent response down south with a reused value to the drink and with the national
launch of Fanta Apple, we are stepping stones to extend Coca
Cola India's market leadership in the fruit-flavoured sparkling drink segment," Kini added. The
company has also announced Bollywood actress Genelia D'Souza as the new brand ambassador
of the Fanta brand.
According to reports, the current expected Indian soft drink market is about Rs 6,000 crore, in
which the company shares about 50% market with its various brands like Coke, 7 Up, Fanta,
Sprite and Thums Up.

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STUDY OF GROWTH OF SOFT DRINK MARKET

SOFT DRINKS:
Carbonated drinks are dominated by artificial flavors based on cola, orange and lime
with Pepsi and coca-cola dominating the market. The entire part of the drink is based on
its artificial flavors and sweetening agents as no natural juice is used.
MARKET:

Cola products account for nearly 61-62% of the total soft drinks market.
Two global majors Pepsi and coke dominate the soft drink market.
NCAER survey says 91% of soft drink in the country is in the lower, lower middle and

upper middle class people.

The market is worth around Rs.5000 crores with growth rate of around 10-15%.
The annual per capita consumption in India is only about 6 bottles vis- a- Vis 34 bottles in

the U.S.
The production as soft drinks has increased from 5670 million bottles in 1998-99 to 6230

million bottles in 1999-2000 industry source.

Growth market this year is expected to be 10-15% in value terms and 20-22% in volume
terms.
However, the market for carbonated drinks is stagnating and not growing as expected.

MAJOR PLAYERS IN SOFT DRINKS SEGMENT

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 COCA COLA: thanda matlab coca cola!!!

Coca cola has truly remarkable heritage. From a humble beginning in 1886 it has now
become the flagship brand of largest manufacturer, distributor of non alcoholic beverages in the
world.
In India, coca cola was the leading soft drink till 1977 when govt. policies necessitated its
departure. Coca cola has made its return to the country in 1993.and made significant investment
to ensure that the beverage is available to more and more people in remote as well as
inaccessible parts of the world.
Coca cola returned to India in 1993 and over the past ten years has captured the imagination of
the nation, building strong association with cricket, the thriving cinema industry, music etc. coca
cola has been very strongly associated with cricket, sponsoring the world cup in 1996.
In 2002, coca cola launched the campaign,Thanda Matlab coca cola. in 2003,coke was
available for just rs,5 crores in the country.

FANTA : GHOONTH BHAR SHARARAT KAR LEY!!

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Fanta entered the Indian market in year 1996 under the coca cola brand .over the years, Fanta has
occupied a strong market place and is identified as the fun catalyst. Fanta stands for its vibrant
color, tempting taste and tingling bubbles that not just uplifts feelings but also helps free spirit
thus encouraging one to indulge in the moment.

LIMCA: LIME AND LEMONI!!!

Drink that can cast a tangy refreshing spell on anyone, anywhere. Born in 1971, Limca has been
the original thirst choice, of millions of consumers for over three decades.
The brand has been displaying healthy volume growing year on year and limca continues to be
leading flavoring soft drinks in the country.
Dive into the zingy refreshment of limca and walk away a new person.
SPIRITE: SPIRITE BHUJAYE PYAAS BAKI SAB BAKWAAS!!!
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World wide sprite ranked as no.4 soft drink and is sold in more than 190 countries In India, sprite
was launched in year 1999 and today it has grown to be one of the fastest growing soft drinks,
leading clear lime category.
Today sprite is perceived as a youth icon. With strong appeal to youth sprite has stood for a
straight forward and honest attitude. Its clear crisp hingtaste encourages todays youth to trust
their instincts, influence them to be true who they are and to obey their thirst.

THUMS UP: TASTE THE THUNDER!!!

Strong cola taste, exciting personality.

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Thums up is a leading carbonated soft drink and most trusted brand in India. Originally
introduced in 1977, thums up was acquired by the coca cola company in 1993.
Thums up, is, known for strong, fizzy taste and its confident, mature and uniquely masculine
attitude. This brand clearly seeks to separate the man from the boys.

MAAZA: YAARI DOSTI TAAZA MAAZA!!!

Maaza was launched in 1976. In 1993, maaza was acquired by coca cola India. Maaza currently
dominates the fruit drink category. Over the years, maaza has become synonymous with mango.
Taaza Mango, Maaza mango, Botal mei aam, maaza hai naam.consumers regard maaza as
wholesome, natural, fun loving drink real experience of fruit.

The campaign builds on the existing equity of the brand and delivers a relevant emotional benefit
to the moms rightly captured in tagline, yaari dosti, and taaza maaza.

PEPSI: YEH DIL MAANGE MORE!!!

22

Pepsi cola is a carbonated beverage that is produced and manufactured by Pepsi co. It is sold in
stores, restaurants and from vending machines. The drink was first made in the 1890s in North
Carolina.
The brand was trademarked on June 16, 1903.There have been many Pepsi variants produced
over the years.

Diet Pepsi

Crystal Pepsi

Pepsi twist

Pepsi max

Pepsi samba

Pepsi blue

Pepsi gold

Pepsi holiday spice

Pepsi jazz

Pepsi x(available in Finland & brazil)

Pepsi next(available in Japan & south Korea)

STUDY OF GROWTH OF FRUIT DRINK MARKET

23

FRUIT JUICES
Branded fruit juice market in India holds an immense potential.
Usually confused and considered synonymous with non-aerated drinks, fruit pulps, juices and
squash are high sugar beverages, which are centrifuged and filtered to give a semi- clear
appearance.
In the past, this sector enjoyed an excise exemption, keeping cost at minimal. However the
withdrawal of exemption has inflated costs and can affect growth, with dramatic change possible
on reintroduction of excise exemption.
MARKET

The organized fruit beverage market is estimated at Rs.500 crores market. (Nectars,
drinks and juices combined).

The market has grown at a 20% to 25% rate.

Of this, more expensive juices segment has grown at rate of 40%this year. It accounted
for only 15% of the fruit beverage 3 years back.

In home consumption of juices has gone up from 30%, three years back to 80%today.

Mango based drinks account for two thirds of fruit drinks industry.

24

MAJOR PLAYERS IN THE FRUIT DRINK SEGMENT

DABUR REAL

Daburs flagship brand real fruit juice is a market leader in packaged fruit juice category. Real
was launched in 1996 and the brand has carved a niche for itself by claiming to be the only fruit
juice in packaged form .i.e.100%preservative free.
Real, with market share of 57% comes in nine flavors:

Orange

Mango

Pineapple

Mix fruit

Grape

Guava

Litchi

Tomato

Cranberry

Real Active is 100%fruit juice with no added sugar and is available in following variants:

Orange

Apple

Orange- carrot
25

26

 GODREJ

The food division of godrej industry produces and market fruit drinks, fruit nectar and sofit
soymilk. Godrejs brand JUMPIN comes in the following flavor:

Mango

Pineapple

Apple

Litchi

Orange

Godrejs xs is a range of fruit nectar with more fruits. Its available in following flavors:

Orange

Apple

Grape

27

 PEPSIS TROPICANA

Tropicana brand fruit juice enjoys a market share of 25% and has registered a double digit
growth and has outpaced the growth of fruit juice market in India. It is available in following
flavors :

Orange
Apple
Grape
Cranberry

LEH BERRY

28

It is a product from Ladakh Foods. Its first fruit juice in Delhi and it's selling it in the more
affluent parts of town. It enjoys a market share of 4% and is available in a variety of flavors:

Pineapple
Apple
Mixed fruit
Orange
Blackcurrant
Mango
Guava

PARLES FROOTI and APPY

Frooti was launched back in 1985 and enjoys market dominance with 85% of market share.
Parles Agros APPY, in 1996 had a market share of 5% in the fruit drink segment; in 2003 its
new variant-APPY FIZZ was launched.

29

Chapter 2
Research methodology

30

Research refers to search for knowledge. One can also define research as a scientific and
systematic search for pertinent information on a specific topic. It is an art of scientific
investigation.

Objectives of research :
1) To find demographic variations among juices & health drinks consumers.
2) To find relation between consumption pattern and
i) income of consumers
ii) suggestion given to others
3) To find various factors affecting there choices.
4) To find brands preferred by the consumer.

Research Methodology:It is the way to systematically solve a problem. The methodology adopted in this study
is explained below:-

Research Design
A. Problem Defining:
The main aim of this research study is to analyse the preference of people (of
different age groups) on consumption pattern of Soft Drinks and Fruit juices.
B. Literature Survey:
I have used newspapers, magazines related to business & finance & apart from
websites.

31

C. Type of research:
The research is qualitative & descriptive in nature. Qualitative research is that
talk about the quality of the subject to be researched and Descriptive research is
one that describes things as exists in present.

D. Data collection Design:

I. Sources of data =
Primary Sources I have used questionnaire as primary source
for collecting data for my study.
Secondary sources I had collected my secondary data from
websites,books & journals.
II. Tools =
I have used some charts (Pie chart, column chart, cylinder chart, cone
chart)

III. Sampling Size =

It represents that how many candidates you have chosen to be filled up
your questionnaire or candidates upon whom you can study. For the study,
a sample size of 50 has been taken into consideration

IV. Data Interpretation =

Data interpretation is that in which we analysis the whole collected data &
tries to give it in simple words to be understandable.

32

Chapter 3FINDINGS AND ANALYSIS

33

Q1. What do you prefer to drink? (Tick any 1)

Particulars

No. of Respondents

Percentage

Soft Drinks

57

57%

Fruit Juices

43

43%

Total

100

100%

ANALYSIS:
From the survey it was found that amongst 100 respondents
a)

57% of the respondents prefer Soft Drinks to drink.

b)

43% of the respondents prefer Fruit Juices to drink.

Q2. Frequency of consumption of your preferred drink in a week?

34

SOFT DRINKS
Particulars

No. of Respondents

Percentage

Daily

28

49%

2-6 times

23

40%

Above 7

11%

Total

57

100%

ANALYSIS:
From the survey it was found that amongst 57 respondents.
a) 49% of the respondents consume Soft Drinks daily.
b) 43% of the respondents consume Soft Drinks 2-6 times.
c) 11% of the respondents consume Soft Drinks more than 7 times.
FRUIT JUICES
Particulars

No. of Respondents

35

Percentage

Daily

10

23%

2-6 times

30

70%

Above 7

7%

Total

43

100%

ANALYSIS:
From the survey it was found that amongst 43 respondents.
a) 23% of the respondents consume Fruit Juices daily.
b) 70% of the respondents consume Fruit Juices 2-6 times.
a) 07% of the respondents consume Fruit Juices more than 7 times.

36

Q3. On what occasions, do you often consume the Soft Drinks?

Particulars

No. of Respondents

Percentage

Feeling Thirsty

18

18%

Parties / Celebrations

45

45%

Without any reason (just like that)

25

25%

Others

12

12%

Total

100

100%

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

18% of the respondents consume Soft Drinks when they feel thirsty.

b)

45% of the respondents consume Soft Drinks at the time of celebrations.

c)

25% of the respondents consume Soft Drinks without any reason.

d)

12% of the respondents consume Soft Drinks on other occasions.

37

Q4. On what occasions, do you often consume the Fruit Juices?

Particulars

No. of Respondents

Percentage

Feeling Thirsty

17

17%

Parties / Celebrations

32

32%

Without any reason (just like that)

24

24%

Others

27

27%

Total

100

100%

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

17% of the respondents consume Fruit Juices when they feel thirsty.

b)

32% of the respondents consume Fruit Juices at the time of celebrations.

c)

24% of the respondents consume Fruit Juices without any reason.

d)

27% of the respondents consume Fruit Juices on other occasions.

Q5. What induces you to buy Soft Drinks?

38

Particulars

No. of Respondents

Percentage

Price with quantity

30

30%

Health Drink

4%

Status symbol

8%

Taste

32

32%

Variety

26

26%

Total

100

100%

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

30% of the respondents consume soft drinks because of its price.

b)

04% of the respondents consume soft drinks because it is a health drink.

39

c)

08% of the respondents consume soft drinks because it is a status symbol.

d)

32% of the respondents consume soft drinks because of its taste.

e)

26% of the respondents consume soft drinks because of its variety.

Q6. What induces you to buy Fruit Juices?

Particulars

No. of Respondents

Percentage

Price with quantity

13

13%

Health Drink

40

40%

Status symbol

15

15%

Taste

22

22%

Variety

10

10%

Total

100

100%

40

ANALYSIS:

From the survey it was found that amongst 100 respondents.

a)

13% of the respondents consume fruit juices because of its price.

b)

40% of the respondents consume fruit juices because it is a health drink.

c)

15% of the respondents consume fruit juices because it is a status symbol.

d)

22% of the respondents consume fruit juices because of its taste.

e)

10% of the respondents consume fruit juices because of its variety.

41

Q7. If not a Soft Drink or a Fruit juice, which other beverage (other than water) tops your
mind?
Particulars

No. of Respondents

Percentage

Coffee

30

30%

Tea

25

25%

Shakes(Milk/Ice cream/Fruit)

8%

Lassi

12

12%

Sharbat

25

25%

Total

100

100%

ANALYSIS:

42

From the survey it was found that amongst 100 respondents.

a)

30% of the respondents prefer coffee.

b)

25% of the respondents prefer tea.

c)

08% of the respondents prefer Shakes.

d)

12% of the respondents prefer Lassi.

e)

25% of the respondents prefer Sharbat.

Q8. How do you rate canned juices as compared to fresh juices?

Particulars

No. of Respondents

Percentage

Equivalent to fresh juices

24

24%

Have artificial added

36

36%

Healthy with preservatives

40

40%

Total

100

100%

flavor

43

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

24% of the respondents think canned juices are Equivalent to fresh juices.

b)

36% of the respondents think canned juices Have artificial added flavor.

c)

40% of the respondents think canned juices are Healthy but have preservatives.

Q9. How do you view Soft Drinks?

Particulars

No. of Respondents

Percentage

As a health drink

4%

As a status symbol

8%

As an aid to put off thirst

55

55%

Any other

33

33%

Total

100

100%

44

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

04% of the respondents view Soft Drinks as a health drink.

b)

08% of the respondents view Soft Drinks as a status symbol.

c)

55% of the respondents view Soft Drinks as an aid to put off thirst.

Q10. How do you view Fruit Juices?

Particulars

No. of Respondents

Percentage

As a health drink

40

40%

As a status symbol

15

15%

As an aid to put off thirst

32

32%

Any other

13

13%

Total

100

100%

45

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a) 40% of the respondents view Fruit Juices as a health drink.
b) 15% of the respondents view Fruit Juices as a status symbol.
c) 32% of the respondents view Fruit Juices as an aid to put off thirst

Q11. Do advertisements affect your purchases?

Particulars

No. of Respondents

Percentage

Yes

77

77%

No

23

23%

Total

100

100%

46

ANALYSIS:
From the survey it was found that amongst 100 respondents.
a)

77% of the respondents think that advertisements affect their purchases.

b)

23% of the respondents think that advertisements do not affect their purchases.

47

Chapter 4
CONCLUSION

48

CONCLUSION

Following are the concluding points taken into consideration after the conduct of the research
study:

An important finding that emerged out of the survey was that 57%of people like to have soft
drinks while 43% go for juices.

Through the research it was conveyed that weekly consumption of soft drinks is higher than
the weekly consumption of juices.

A majority of the respondents consume soft drinks and fruit juices at the time of parties &
celebrations.

Most of the respondents consume soft drinks because of its taste and price.

Most of the respondents consume fruit juices because it is healthy.

As it is seen that canned Juices enjoys the largest market share though they do contain some
preservatives but majority of the respondents consider it healthy.

Most of the respondents view soft drinks as an aid to put off thirst and fruit juice as a health
drink.

49

Most of the respondents (77%) were of the strong view that advertisements affect their purchases
and the rest (23%) were not at all affected by the advertisements.

Chapter - 5
RECOMMENDATIONS

50

RECOMMENDATIONS

With the changing lifestyle, people have started becoming more health conscious.
Therefore, the fruit juice companys should use appropriate marketing techniques thereby
reducing the demand for soft drink in the future.

The survey shows that parties/celebrations are the places where these drinks are
consumed mostly. The companys must try to increase the sales by creating and focusing
on more utilities so that their product is used more frequently.

As it is seen that people consider canned juices to be healthy with preservatives. This
shows that awareness level of the people is low and needs to be corrected. Therefore,
various methods like campaigns by government, help by media, etc can be taken to
change this.

51

Chapter - 6
LIMITATIONS

52

LIMITATIONS

The study was confined to some areas of New Delhi only.

The study does not take into account the sales affected of the soft drink segment due to
the entry of juices.

Retailers view and the companies view to the questionnaire were not available.

Time and cost constraints were also there.

Chances of some biasness could not be eliminated.

A Samples size of 100 has been use due to time limitations.

53

BIBLIOGRAPHY

54

BIBLIOGRAPHY

WEBSITES:
http://www.euindiaaviationsummit.com/health-drinks/
http://www.naturalnews.com/soft_drinks.html
http://www.the-infoshop.com/topics/FD14_en.shtml
www.foodindustryindia.com
http://en.wikipedia.org/wiki/Beverage
http://www.foodindustry.com/newfood/detailnews.jsp?n=Xtazy,%20another%20energy%20drink
%20for%20the%20Indian%20market&id=598

BOOKS:
Malhotra . N.K, Marketing Research Fifth edition.
Kothari C R, Research and Methodology- Methods & Technique, New Age International (P)
Ltd.,2004

55

Annexure

56

Questionnaire

NAME :AGE :SEX :OCCUPATION :-

Q1. What do you prefer to drink ?

(a) soft drink

(b) fruit juice

(c) both of the above

(d) none of the above

Q2. How often do you drink your brand ?

(a) daily

(b) juice a week

(c) once a week

(d) occasionally

Q3. On what occasion , do you prefer to consume soft drink ?

(a) feeling thirsty

(b) parties/function

(c) others, please specify

57

Q4. On what occasion do you prefer to consume fruit juice ?

(a) feeling thirsty

(b) parties/function

(c) others, please specify

Q5. Which drink do you like most ?

(a) soft drink

(b)fruit juice

Q6. What induces you to buy soft drink ?

(a) price with quality

(b) taste

(c) status symbol

(d) brand ambassador of yourchoice

Q7. What induce you to buy fruit juice ?

(a) price
(c) flavours

(b) health drink

(d) easy availability

Q8. What do you prefer other than soft drink or fruit juice ?
(a) coffee/tea

(b) shakes(milk/ice cream/fruit)

(c) lassi

(d) others, please specify

58

Q9. How do you rate the below following ?

EXECELLENT

GOOD

CANNED JUICE
FRESH JUICE

Q10. Why do you prefer soft drink ?

(a) status symbol

(b) to remove your thirst

(b) easy availability

(d) others, please specify

Q11. Why do you prefer fruit juice ?

(a) health drink
(c) flavours

(b) to remove thirst

(d) others. Please specify

Q12. Which one of the below is economy ?

(a) soft drink

(b) fruit juice

Q13. Do advertisement effect your purchase ?

(a) yes

(b) no

Q14. Name any three of yours favourite brand ?

59

AVERAGE

(a)..(b).(c)

Q15. Name of any three of your favourite brad in soft drink ?

(a)(b).(c)..

Q16. Which one is more hygienic ?

(a) soft drink

(b) fruit juice

Q17. With whom you prefer to drink fruit juice ?

(a) alone

(b) family

(c) friend

(d) others, please specify

Q18. With whom you prefer to drink in soft drink ?

(a) alone

(b) family

(c) friend

(d) others, please specify

Q.19 Which advertisement influence you to buy the drink ?

(a) television advertisement

(b) print advertisement

(c) others, please specify

60