As mentioned in previous posts about Cambodia, Coca-Cola’s power in individual markets stems from outsourcing their bottling; Coca-Cola governs the trademark and marketing in each country, but the bottlers localise production and keep costs down. The scarcity of Coca-Cola in Laos is testament to just how powerful localised production can be.
Only Pepsi has a bottling plant in Laos, a mountainous country with poor infrastructure and one of the lowest GDPs in SE Asia. Coca-Cola is imported from neighbouring Thailand or Vietnam. And you can really tell.
Swapping Coca-Cola Red for Pepsi blue
The umbrellas and awnings which were bright red in Vietnam are all light blue; Pepsi is on tap in the majority of bars and Pepsi’s “Live for now” motto dominates billboards (bizarrely still featuring Brazilian world cup football fever). When you are seeking Coke, the contrast with the previous countries I visited is very noticeable, as if Coca-Cola has just forgotten about this small section of Asia.
PepsiCo’s campaign in Laos it is not localised, relying on internationally recognisable football stars to build awareness. The campaign itself is much more hedonistic than Coca-Cola’s “Open Happiness”, and it’s questionable whether it speaks to local mums with their shopping trolleys, trying to swing their allegiance. Should they buy a drink of happiness, or live in the moment and buy Pepsi? Admittedly there are lots of similarities between the 2 campaigns, and the CTAs both allow a wide variety activations, especially experiential, but can a fizzy drink get away with encouraging you to “Live for now”? Perhaps not such an issue in SE Asia (see my blog on attitudes to Coca-Cola in Vietnam, especially the section on sugar intake) but as this is a global slogan, it seems to be rather shirking responsibility. I suppose you can be a little more risky when you are still vying for the top spot internationally.
Coca-Cola is around in Laos but fewer and far between
However, whether or not Pepsi’s campaign is as strong as Coke’s, they still own the Laos market purely because of infrastructure. Coca-Cola is poised to start making waves in Laos, with a bottling plant opening in the near future – Coke’s press release states 2014, but I was told 2015 by an Irish bar owner in Luang Prabang, and travelling back in time to open a factory on schedule does seem unlikely!
Whenever the new bottling plant finally opens its doors, it will be interesting to see how much it affects the local market dynamics. Will traders remain loyal to Pepsi or will they be lured into switching to Coca-Cola by its perceived exclusivity? And will it be a question of taste, consumer habit or marketing clout?
Coca-Cola & Travelling Brands 