30 May 2006
Pepsi-Cola recently relaunched in South Africa with a breathtaking television commercial featuring its easy-grip bottle, a skyscraper construction site – and footballer David Beckham. It will have to do more as it makes its third attempt to wrest market share from one of South Africa’s most admired brand names.
Pepsi-Cola left South Africa in 1985 in protest against apartheid. After Mandela became President in 1994 the company returned with great fanfare. Three years later – after taking a market whipping from Coca-Cola – Pepsi’s South African partner, bottling company New Age Beverages, folded.
Ten years on, writes Robert Laing in the Mail & Guardian, “Coke faces a far more formidable foe. Pepsi-Cola’s parent company Pepsico is already entrenched in South Africa – not through drinks, however, but through crisps.”
As Laing explains, Pepsico’s other arm – Frito-Lay – also re-entered South Africa after 1994, buying half of local crisp maker Simba for US$55-million in 1995 and upping this stake to turn Simba into a wholly owned subsidiary in 1999.
“Frito-Lay’s crisps and Pepsi’s cold drinks each contribute roughly half of [Pepsico’s] sales, but the crisps business – where Pepsico does not face mighty Coke, only small regional players – is far more profitable,” Laing writes.
Local franchise partner
This time around, Pepsi is entering South Africa by way of a franchise deal with Pioneer Foods, home to popular South African household food and drink brands such as Ceres, Marmite, Weet-Bix, Bokomo, Safari and Liqui Fruit.
Pioneer’s beverage subsidiary, Ceres Fruit Juices, will produce, bottle and distribute a range of Pepsico soft drinks – including Pepsi, Diet Pepsi, 7-Up and Mirinda – at Ceres’ plant in Gauteng province.
In a statement issued in July 2005, Arnold Veraart, general manager of Pepsico’s sub-Saharan Africa business unit, said Pioneer Foods was awarded the franchise on the basis of its “successful track record in the local food and beverage industry – particularly in product development, packaging, distribution and marketing.
“By using the extensive Ceres network to make Pepsi products more widely available, this will provide greater choice for consumers and retailers across South Africa,” Veraart said.
‘Painting South Africa red’
Pepsi will need all the help it can get against Coca-Cola, and not only because of its alliance with the formidable South African Breweries’ Amalgamated Beverage Industries.
In an article on brandchannel.com titled “painting South Africa red,” Ron Irwin argues that Coke’s success in Africa “has been due to its savvy advertising as well as its ubiquitous involvement in local community life.
“City dwellers in South Africa cannot fail to notice the Coke signs installed in every shop and roadside stand, but Coke has taken the initiative to reach poorer South Africans in rural areas as well. To this end it has initiated sports sponsorships, sports development, entrepreneurial development, scholarships and education projects.
“It has also relentlessly found ways to get its products trucked into even the most remote corners of Africa, and has cultivated a reputation for corporate honesty and openness that has won the respect of African businesspeople from Cape Town to Madagascar.”
‘Sphincter-tightening’ TV ad
Pepsi knows this all too well, and clearly pulled out all the stops on the spectacular TV commercial announcing its return to South Africa.
Chris Moerdyk, writing for Bizcommunity.com, waxed lyrical about the ad: “Those scenes on the skyscraper so high above the ground are breathtaking, and I can imagine they have millions of viewers not only sitting on the edge of their seats but sitting a few centimetres higher than normal as their sphincter muscles tighten up like agitated sea anemones.”
But more will be needed to crack the South African market, as Moerdyk suggests, noting that the advert “doesn’t seem to have any sort of back-up. I have looked in vain at my local cafe and supermarket and haven’t seen any sort of Pepsi hype at all.”
News24 columnist Stacey Maree is more forthright – nor is she impressed with the commercial’s use of David Beckham to welcome Pepsi back to SA.
‘Gee thanks, Beckham!’
Maree, in a piece titled “Gee thanks, Beckham!”, echoes the brandchannel article when she writes: “Remember that scene in The Gods Must Be Crazy? The little bushmen who’s struck on the head by a Coke bottle that fell from the sky? It’s an iconic South African scene.
“Just recently, there’s the Coca-Cola Soccer Stars with a R250 000 first prize up for grabs,” Maree continues. “And the Coco-Coca Colab concerts in March that delivered international music acts to our doorstep.
“Coke has done their homework and come down to grassroots level in a country that appreciates big corporations contributing to our development. It’s obviously a winning strategy.
“What has David Beckham done to entrench himself in South African culture? Putting his hair in braids doesn’t count!
“Pepsi, you’re off to a shaky start.”
The global picture
Of course, South Africa is but a small battlefield in the context of the global “cola wars” – a conflict considerably heightened by the 2006 Football World Cup.
What South Africans may not immediately be aware of is that Pepsi’s use of Beckham comes against the backdrop of a massive international “Pepsi Football 2006” campaign that aims to counter Coke’s “We All Speak Football” campaign.
While Pepsi’s World Cup strategy revolves around sponsorship of individual football stars, Coca-Cola’s strategy is underpinned by its official partnership of the competition. Coke is one of Fifa’s “elite partners”, owning official sponsorship status for Germany 2006 – and, already, for South Africa 2010.
In which case, perhaps Pepsi should take a longer view, and start looking for a South African player to add to its stable of superstars.
Or maybe South Africans would have identified more readily if Pepsi had got Ronaldinho to introduce their South Africa commercial. South Africa’s style of football bears a closer resemblance to Brazil’s than to Europe’s.
And Beckham is already cast, in the minds of local television viewers, as having “the best (shave) a man can get”.
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