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NEW YORK ( Trefis) -- Coca-Cola(KO) announced its decision to pour in additional $3 billion into India that will see the total investment in the country at $5 billion over the next eight years.
Coca-Cola's volumes grew 12% in 2011 in India, helped by strong performances by Sprite, Coca-Cola and Thums Up, the Indian cola company acquired by Coca-Cola in 1993. The per-capita consumption of soft drinks in India is only a fraction of what it is in more mature markets, and so the soft drink companies see a great future in the country.
So far, Coca-Cola has spent around $2 billion in India since its return to the country in 1993. Overall, this is part of $30 billion of global investments planned by the company in the next five years.
Coca-Cola's unique selling point is its high degree of brand recognition. The brand is identifiable
everywhere, even by consumers in countries where it has little to no presence. Hence, whenever Coca Cola launches a new product, there is a certain degree of excitement associated with the launch and consumers are more than willing to try the product.
In fact, according to one report, the Coca-Cola logo is identifiable by a whopping 94% of the world's population.
Besides India, we look at some other regions where Coca-Cola is investing heavily in and whose success is critical to the company's long-term performance. (See our
China: This is the epicenter of global investment. Every major corporation wants a piece of China, and Coca-Cola is no different. The company opened its 42nd bottling plant in the country in March 2012. Further, Coca-Cola plans to spend more than $5 billion in China in the next three years. Coca-Cola's volumes grew 13% in the country in 2011.
Brazil: The company will invest a staggering $7.6 billion in Brazil through 2016, which includes sponsorship for the soccer world cup to be held in 2012 and the Olympic games in 2016. The investment will also see the company opening three new factories in a country which already has 47 factories. Although Coca-Cola's volume grew only 1% in Brazil in 2011, it surged 11% in 2010.