PepsiCo and Tata Tea Joint Venture for Wellness Beverage

Right now, I am suffering from obesity and the first thing that I want to totally leave is drinking Coke or Pepsi. I wish that most people would follow my example in South Asia. Anyway, I am happy to hear that PepsiCo and Tata Tea are forming a joint venture for making some money from wellness beverage segment. The basic idea is to make some healthy drinks for ordinary people. The price will not be much and the drinks will not be bad for health.  

Economic Times reported:

Its likely focus on the lower end of the market will ensure that PepsiCo’s existing global alliance with Unilever to sell Lipton ice tea, which focuses on the mid- to-premium segment, will not be impacted. The new tieup will give PepsiCo the opportunity to be perceived as a wholesome beverages company, not just as a company making fizzy drinks. Tata Tea will get a larger foothold in the wellness beverages segment after an earlier attempt to foray in the category had to be aborted within a year. 

The market for both soft drinks and wellness beverage is increasing rapidly in India. Because of the high GDP growth, this market will only expand for many years to come. 

PepsiCo is going to invest more money in India

PepsiCo is the company that brings out the popular soft drink Pepsi. In India, Pepsi is a very familiar brand name because very famous celebrities like Shah Rukh Khan and Sachin Tendulkar used to do the advertisement of this company in the past. In fact, in the last one decade, most of the time we saw that Pepsi had leading Bollywood and cricket celebrities to promote their product. So, it is very nice that PepsiCo is going to invest nearly 200 million dollar in Indian market.

It comes as a strategy to expand the company’s revenue in the markets outside of USA. In USA, the company is now facing two kinds of problems. There is not a lot of rooms for growth as most people already drink soft drinks. On the other hand, the cost of materials for producing drinks like Pepsi is increasing. I think that there will be another problem in near future in USA market. In USA, at this moment many people are suffering from over weight and obesity and soft drinks are considered to be one of the major reasons behind it.

On the other hand, thanks to Bollywood and cricket celebrities, drinking Pepsi is considered to be a cool thing among many young people. Thus, I think that the Pepsi is doing right investment in the right place.