Worry about the route your new product takes to market

Research shows Kenyans lean towards supermarket purchases. FILE PHOTO | NMG 

By QUEEN MUNGUTI

More by this Author

Summary

• Using an existing market channel to sell a different product for the same consumers has been found to be a more cost-effective strategy than breaking into new products that require different routes to market, making established marketing channels an asset in their own right.

Coca-Cola has announced the launch of its first-ever alcoholic drink, but only in Japan, where it will be selling the canned drink in the country’s vending machines, as a marketing channel that it already dominates and which is not separated across non-alcoholic and alcoholic sales.

Using an existing market channel to sell a different product for the same consumers has been found to be a more cost-effective strategy than breaking into new products that require different routes to market, making established marketing channels an asset in their own right.

For Coca-Cola, the launch is part of a global strategy of beverage launches, including in Kenya, to suit changing customer tastes and buying habits.

In Japan, its newest launch “will be a canned drink that will include alcohol in its ingredients. Traditionally, the product category known as Chu-Hi (alcopop) is made with a distilled beverage called shôch and sparkling water, plus some flavouring.

Coca-Cola has always focused entirely on non-alcoholic beverages, and this is a modest experiment for a specific slice of our market.

Globally, it is not uncommon for non-alcoholic beverages to be sold in the same system as alcoholic beverages,” said Jorge Garduño, Coca-Cola’s Japan president in an interview published on its corporate website.

In choosing Japan for its low- alcoholic product launch, Garduño said it stood out because of Japanese consumers’ heavy focus on convenience shopping and the greater popularity channel of vending machines than in any other country globally.

According to the Japan National Tourism Organisation, the country has approximately 5.52 million vending machines that generate around 6.95 trillion yen (Sh6.64 trillion) of annual sales.

Their success is rooted in their convenience, which means consumers do not have to enter a store to buy a drink or a snack, which is an advantage that has made them a key part of the country’s retail sector.

READ: Positioning new products to gain from good name of brand

Simply placing the new drink in such heavily used vending machines will, therefore, open an instant direct reach for Coca-Cola.

According to UK marketing consultants InReach Global Consulting, choosing the right route to market for a product, and specifically one that puts it right in front of consumers, increases a brand’s awareness, and influences purchasing decisions that drive sales.

“Choosing the right route to market is as important as deciding the kind of product to sell and to which market. Different routes to market will suit different kinds of products or services, in order to win the market, it has to be simple and straightforward as possible for customers to discover the product in order to easily purchase it,” reported InReach Global Consulting.

In the Kenyan market, Coca-Cola chose to re-introduce its soft drink, Minute Maid, in October last year, by getting it presented on supermarket shelves.

“In Kenya, supermarkets are the go-to destination for most consumers, therefore will offer a brand high visibility and will allow customers to interact with the product directly as they make their purchase decision. They are also able to compare prices of different products in the same market category, which helps in influencing consumer choice,” said Stella Kimani, a brand strategist.

Thus, Coca-Cola Kenya did not begin with launch marketing, which came later on, but by first creating awareness through its supermarkets’ placement, as the preferred shopping destination for Kenyan consumers.

According to a 2016 research conducted by GeoPoll, a mobile survey platform, titled Spending Habits and Perceptions of the Economy in Kenya, Nigeria, and South Africa, 56 per cent of Kenyans would rather shop in a supermarket, with just 35 per cent preferring to shop at a local kiosk, because consumers prefer to shop in bulk rather than buying single items from different small shops.

Thus, by the time Coca-Cola Kenya officially announced that Minute Maid was back in the Kenyan market, and began marketing, the drink was already firmly in place on supermarkets’ shelves making it available and accessible for the early adopters.

- African Laughter