Coca-Cola Company makes move to strengthen position on quickly booming Polish market

The Coca-Cola Company, which controls more than half of the global market in non-alcoholic drinks, wants to strengthen its position in Poland, the Polish daily Dziennik reported last week.

The company strategy for 2007 includes becoming one of the top two brands in all segments of the Polish beverage market. Coca-Cola currently leads in 3 of 6 categories, those being: carbonated soft drinks, sports drinks, energy drinks, tea/coffee, juices and nectars, and waters.

Everyone knows Coca-Cola as one of the most famous brand names in the world. In the last BrandZ Top 100 Most Powerful Brands ranking, Coca-Cola took forth place with a brand value of $44.134 bln.

Google was number one in the ranking ($66.434 bln), General Electric was second ($61.880 bln) and third place went to Microsoft ($54.951 bln).
BrandZ 100 was developed by the Financial Times, Datamonitor, and research company Millward Brown Optimor.

Raw data for the study is collected annually through interviews with professionals and customers, who are asked to evaluate brands they actually purchase from product categories. This results in a valuable market survey, which indicates product characteristics important to the consumer.

However, the findings of the BrandZ 100 refer to global rankings, while in Poland the world?s leading soft drink concern has yet to win a top position in half of the non-alcoholic drink categories.

Coca-Cola leads the Polish market in the carbonated soft drink category with Coca-Cola, Coca-Cola light, Cherry Coke, Fanta, Sprite, Kinley tonic and Lift (32%).
Powerade isotonic drink is number one in the sport drink category (52%). Nestea iced tea dominates the tea/coffee sector (55%).

The other three market segments –juices and nectars, energy drinks and non-carbonated mineral waters — are going to be the main field of competition for the company this year. Intensifying the competition, Restaurator magazine, a Polish Food and Beverage Service trade channel publication, supported Coca-Cola HBC Polska?s growth position by awarding the company ?Partner of the Year 2006? in the Drinks, Juices and Waters category as indicated by survey results.

According to data published in Handlowiec, a Fast Moving Consumer Goods (FMCG) monthly magazine, a total of 720 mln liters of mineral water was sold in Poland from March 2006 to February 2007.

Danone Group led with 28.8 percent of sales (207 mln liters), Nestle took second with 9.5 percent (67 mln liters), and Coca-Cola finished third with 8.1 percent of sales (just over 58 mln liters).

This puts Coca-Cola very close in second place. Given the company?s wide distribution network and huge advertising budget, sales of an additional 10 mln liters seem quite possible within the nearest future.

The energy drinks market is another company target.
According to Rzeczpospolita, during the first four months of 2007, Poles bought almost 6 mln liters of energy beverages. This is 150 percent more than last year reports the research company Nielsen.

The changing lifestyle is largely responsible for the increasing popularity of energy products in Poland, the producers explained.

?As consumers live faster and more intensively, they become eager to buy energy drinks,? said Anna Czerniecka from Red Bull Poland.

Red Bull, the unchallenged leader of the energy drink market for the previous 10 years, was bypassed by Polish rival Tiger during the 2006-07 sales year.
Tiger energy drink is produced by the Polish company ?Gellwe,? which is located in Zabierzow, a few kilometers from Krakow.

Of late, Red Bull?s position has been under attack not only from Tiger, Rzeczpospolita reports, but also from Coca-Cola?s entry into the market — Burn.
Burn has appeared in Polish stores for the last 4 years, but in September 2006 the producer completely revamped the packaging.

Corporate Director of Coca-Cola HBC Polska Iwona Jacaszek states that the company plans to actively support Burn?s market position. New Burn delivers 35% more energy than other energy drinks available in Poland.

With an extensive line of non-alcoholic beverage products, (nearly 30 percent of the company?s total product volume consists of non-carbonated soft drinks), Coca-Cola is expect to be well positioned to capitalize on the rapid future growth of the Polish soft drink market.

Market competition will benefit Polish consumers by encouraging firms to introduce new products, targeting specific consumer groups. According to the company?s official press service, Coca-Cola was first produced in Poland in 1972.

Direct investment started in 1991, just when the country began to make far-reaching changes in its political and economic system. In 1992, three Coca-Cola plants were opened and local production of Fanta Orange and Sprite started. The first coolers, dispensers, racks, displays and signs appeared the same year.

Coca-Cola beverages are produced and distributed by Warsaw-based Coca-Cola HBC Polska, Coca-Cola HBC?s affiliate in Poland. Coca-Cola HBC Polska owns and operates 4 bottling plants and has 31 sales and distribution centers located throughout the country.

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