Cola and yoghurt. Not natural bedfellows, one might think. Pepsi begs to differ. Last year, it unveiled White, a cola-yoghurt drink, and the latest in a growing number of eyebrow-raising innovations by FMCG giants.
It is no coincidence that the product made its debut in Japan, a market famously receptive to novelty in its many forms. In the same market, Canada Dry recently launched a Mild Pear variant of, confusingly, ginger ale. Japan is not alone in seeing concoctions like these hit the shelves - Hong Kong ventures have included Pepsi Blue and Coca-Cola Light Lemon - but it is distinct in terms of the regularity and sheer wackiness of its product launches. The question is the impact on the brands. As one source comments on Pepsi: “Too many of these ‘huh?’ products, while certainly raising the cola’s profile, can equally deplete its already insufficient brand equity in Japan.”
It is no coincidence that the product made its debut in Japan, a market famously receptive to novelty in its many forms. In the same market, Canada Dry recently launched a Mild Pear variant of, confusingly, ginger ale. Japan is not alone in seeing concoctions like these hit the shelves - Hong Kong ventures have included Pepsi Blue and Coca-Cola Light Lemon - but it is distinct in terms of the regularity and sheer wackiness of its product launches. The question is the impact on the brands. As one source comments on Pepsi: “Too many of these ‘huh?’ products, while certainly raising the cola’s profile, can equally deplete its already insufficient brand equity in Japan.”
John Goodman, president of Ogilvy Japan, admits that, from a Western-style branding perspective the introduction of seemingly random, unfamiliar products potentially leads to a sense of inconsistency and confusion among consumers. But in a market addicted to ‘newness’ - though not necessarily innovation - playing the game becomes an essential feature of a company’s marketing strategy.
“Without a constant stream of newness, customers get bored and start to look elsewhere,” he observes. “Margins on consumer products are good, so manufacturers can afford to try these wacky ideas and see which ones give a temporary kick and a halo effect on the core brand. And if you don’t play, you run the risk of being seen as boring and of quickly losing shelf space.”
While Simon Chow, associate director of retail services at research firm Nielsen in Hong Kong, notes that product launches that go against a brand’s fundamental proposition would be foolhardy, he sees the soft drinks sector as a relatively risk-free testing ground for producers. “If it proves successful, they continue. If not, they switch to something else,” he says simply.
Goodman agrees, adding that fast turnover categories inherently allow a concept to be initiated and withdrawn “without too much pain or legacy”. The region as a whole is open to sampling, although experimental launches remain more feasible in smaller, mature markets, not just because of consumer sophistication, but because of cost and distribution implications.
It’s easy to see Japan as a one-off, but M&C Saatchi’s Asia chief executive Chris Jaques argues that it is only unusual in that it matured early, making competitive advantage a serious necessity sooner than in many other regional markets. “The rest of Asia is less developed in terms of the corporate environment, and has been in perpetual growth. The issue for many companies is cost. The more sub-brands you have, the more it costs to maintain them. Business in the rest of the region is also much more fragmented, and in Chinese consumer cultures, there is no such thing as successful niche brands. It is bound to become more widespread, particularly in China, but it is a matter of maturity.”
Dave McCaughan, regional director of strategic planning at McCann Worldgroup, agrees that products like these may be part of marketing’s future. He says novelty FMCG products are not really novelties at all, but rather the result of an ongoing desire for customisation. The average 30-year-old in Hong Kong, Bangkok or Tokyo, he says, has had access to a dizzying array of new products, and new versions of those products, their entire lives. That is now normal and to be expected. “Customisation, having a flavour, a variety, and a size that is unique, is not a gimmick or an unusual offering. It is part of what a good brand does.”
Got a view?
Email Feedback@media.asia
