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Coke Hopes Its Cold Drinks Will Be Hot In China

Coke has plugged its flagship cola at Olympiads for decades. But its marketing blitz in Beijing is especially important for the brand as the Games present a chance for it to vault ahead of archrival Pepsi-Cola in the race for China's 1.3 billion coveted consumers -- a market that Coke says could one day be its biggest.

In a country where many prefer their beverages warm, Coke is trying "to teach consumers how to drink Coke and how to love Coke" that is being served in a giant pavilion downtown at precisely 37.4 degrees, according to Joseph Tripodi, Coke's chief marketing and commercial officer. Bill Pecoriello, a Morgan Stanley analyst, pegs Coke's volume growth in China at roughly 17% this year. That's slightly slower than last year, after disruption from the earthquake upset sales, but it's still a hefty clip given the size of the market.

In an early coup last year, Coke signed an endorsement deal with basketball star Yao Ming, China's most famous athlete, who for years had represented PepsiCo. Since this spring, the brand's Chinese ad anthem, "Red Around the World," has become a popular tune -- even at some Olympic events.

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