Has Pepsi become Chinese enough?

This weekend I was at the Midi Music festival in Shenzhen which had a whole stage and area sponsored by Pepsi Coke (百事可乐). Live bands, video-games and of course their famous soft-drink were there to appeal to the young urban crowd attending the festival. This reminded me a lot of Pepsi's strategy worldwide, tying itself to pop and sports-culture to obtain a cool image with a young target group. How does this work out for them behind the Great Wall?

Pepsi Coke first entered the Chinese market in 1981, 2 years after big rival Coca Cola re-entered the territory after a 30+ years absence due to the communist rulers closing their borders to foreign investors. As a very American-looking brand, Pepsi worked hard during the past 30 years to become more Chinese. But looking at their strategy, it hasn't been so different from what they've been doing in the rest of the world. They just added a bit of Chinese flavour to it. But often these 'Chinese spices' still seemed cooked up in the States.

A good example is this 2004 ad, featuring famous Chinese pop stars like Taiwan's Jay Chou and Hong Kong's Edison Chen. But they don't sing a note: instead they do what Americans like Chinese to do: kung-fu!



Another beautiful case of Pepsi literally showing its love for the Middle Kingdom is this commercial surrounding the 2008 Olympics: 'Love China' (all the people in the commercial are shouting 'Love China')



Where did this marketing strategy lead to? Well, to a 4.4% market share in China. Which is not bad concerning the population traditionally has a preference for non-carbonated drinks including tea and fruit juices. But when looking at Coca Cola's 15% market share in the country, it seems Pepsi has lost this cola war as well. Maybe that's why in their latest Chinese New Year commercial, the focus is on family and love. Traditionally a much more 'Coca Cola' claimed area.



But people who know a bit of the Chinese entertainment industry will still recognise familiar faces ;-)