NEW DELHI: Coca-Cola India president Venkatesh Kini has dismissed speculation about churn among managers and exits from the company.
“When there is a reshuffling of roles, which we have done in recent months, there is bound to be speculation. We continue to have the lowest attrition among peer companies,” he said.
Speculation has been rife that at least a couple of senior officials are leaving the Indian unit of the world’s largest fizzy drinks maker. Kini denied it, saying the company had routinely reshuffled roles and has promoted other managers to leadership roles in overseas markets.
Acknowledging concerns about the growing preference for noncarbonated beverages, especially among urban consumers, he said the company is addressing the issue by broad-basing its portfolio to include alternatives with less or no sugar.
“Concerns about sugar are really a metro-urban phenomenon. It is in the bigger cities and among the top consumption bracket,” Kini told ET.
Non-carbonated drinks now account for 40% of Coca-Cola India’s sales and are significantly higher than levels five years ago. “We have a range of beverages to offer consumers now that are zero or low-calorie or pure hydration where we add no sugar,” Kini said. In recent months, Coca-Cola has introduced Fuze iced tea, dairy brand Vio, fortified enhanced water brand Aquarius and coconut water Zico to diversify its portfolio that’s dominated by carbonated brands — Coke and Thums Up colas, Limca and Sprite lemon drinks and Fanta orange.
“We have hundreds of brands to choose from our global portfolio to bring to India. But yes, if you ask specifically, the focus will be on newer categories. And that’s because we already have a complete portfolio of carbonates,” Kini said.
He added that among mass consumers, concerns about packaged beverage consumption remained safe hydration, accessibility and affordability, and not sugar.
“We are addressing different consumer needs differently. For really top-end urban consumers concerned about sugar, we have a wider portfolio. For mass consumers, we have introduced and will continue to focus on different packaging sizes across our portfolio of brands,” he added.
On the current trade ban in Tamil Nadu, he said the company was in constant dialogue with associations in the state.
“Our sales in that state were hurt and they continue to be hurt. But the dialogue is underway. Hopefully, there will be a positive outcome,” Kini said.
He added that concerns trade associations in Tamil Nadu raised about water shortages or local culture are “real issues.”
“When we had conversations with the trade associations on what we have done for them and how little water we actually use from the state, we put back much more water than we use, when those facts were communicated, it resulted in lowering of temperatures. The dialogue continues; I wouldn’t say the issue is resolved. And what we have learnt is to tell our story proactively rather than wait for issues to arise,” he added.
Sales of soft drinks companies in India have grown in low single digits for the past five-six quarters. Kini attributed the slowdown to two bad monsoons, a slowing rural economy and demonetisation. He said a sugar tax would be “the best way to address public health.”
“Taxation should be directly proportional to sugar, salt or calorie content. Then it is a level playing field for all companies; everything that has sugar should be taxed. The reality is our entire portfolio of products contributes less than 1% of sugar consumption in India. We are not in the business of selling sugar, we are in the business of selling beverages,” he said.
Today, the presence or absence of carbonation is being used for taxation, which actually doesn’t make any difference to consumer health, he added.
The company is stepping up focus on functional non-cola drinks and increasing availability of sports drinks, dairy, ready-to-drink tea and coffee and flavoured waters