Coca Cola, the world’s largest beverage company, has entered the Indian alcoholic beverages market with its new product, Lemon-Dou. Lemon-Dou is a chu-hi drink, a popular category of alcoholic beverages in Japan that are made from distilled spirits, carbonated water, and flavoring. Lemon-Dou is made from crushed whole lemons infused in alcohol and mixed with bubbles, creating a refreshing and full-bodied drink.
According to the company’s website, Lemon-Dou is available in 250 ml cans at ₹ 230. The drink has an alcohol content of 5%, which is comparable to most beers. The company claims that Lemon-Dou is made with natural ingredients and no artificial flavors or colors.
A strategic move to tap into the growing Indian market
Coca Cola’s entry into the Indian alcoholic beverages market is a strategic move to tap into the growing demand for premium and innovative drinks among young and urban consumers. According to a report by Euromonitor International, the Indian alcoholic beverages market is expected to grow at a compound annual growth rate (CAGR) of 7.7% from 2020 to 2025, reaching $41.7 billion by 2025. The report also states that the Indian market is witnessing a shift from traditional drinks such as whisky and rum to newer categories such as wine, beer, and ready-to-drink (RTD) products.
Coca Cola is not the only global beverage giant that is eyeing the Indian market. In 2019, Anheuser-Busch InBev, the world’s largest brewer, launched its first non-beer product in India, a RTD cocktail called Breezer. In 2020, Diageo, the world’s largest spirits maker, launched its first RTD product in India, a whisky-based drink called Sterling Reserve B10. Both these products are aimed at attracting young and female consumers who are looking for convenient and flavorful drinks.
A challenge to overcome regulatory and cultural barriers
Coca Cola’s entry into the Indian alcoholic beverages market is not without challenges. The company will have to overcome the regulatory and cultural barriers that exist in the country. India has a complex and varied taxation and distribution system for alcoholic beverages, which varies from state to state. Some states have high taxes and duties, while some have prohibition or partial prohibition. The company will also have to deal with the social stigma and religious sensitivities that are associated with alcohol consumption in India, especially among women and rural populations.
Coca Cola will also have to face stiff competition from local and regional players who have a strong presence and loyal customer base in the Indian market. Some of the leading players in the Indian alcoholic beverages market are United Breweries, Radico Khaitan, Allied Blenders and Distillers, Pernod Ricard, and Carlsberg.
A milestone for Coca Cola’s global expansion
Coca Cola’s launch of Lemon-Dou in India is a milestone for the company’s global expansion strategy. The company has been diversifying its portfolio beyond its core soft drinks business, which has been facing declining sales and consumer preferences for healthier and low-sugar options. The company has been investing in categories such as water, juice, tea, coffee, energy drinks, and dairy products.
The company has also been experimenting with alcoholic beverages in select markets. In 2018, the company launched its first alcoholic product, also a chu-hi drink, in Japan. In 2020, the company launched its first hard seltzer product, Topo Chico, in Latin America and the US. The company has also acquired a minority stake in Bodyarmor, a sports drink brand that is planning to launch its own hard seltzer product.
Coca Cola’s entry into the Indian alcoholic beverages market is a sign of the company’s ambition and confidence to capture new growth opportunities and cater to the evolving tastes and preferences of consumers around the world.
