How Coca Cola Lost India (And How They Won Her Back)


Coca Cola: the American drink that is basically
capitalism in a bottle. During the 20th century, as capitalism spread
around the world, so too did Coca Cola to the point where the only place left where
you can’t get it today is North Korea. But Coca Cola has had an easier time in some
places than in others and in this video we’re gonna see how it took Coca Cola almost half
a century to capture one of the world’s biggest markets, India. This video is brought to you by Audible. Listen to Adam Grant’s new book Power Moves
for free by registering with the link in the description. Coca Cola’s entry into India, like in many
other markets, came on the back of pure opportunism. India had become independent in 1947 and within
three years Coca Cola had already established a bottling plant in New Delhi. Now, India’s first independent government
was determined to take India down the path of socialism, which of course meant supporting
local industry at the expense of foreign companies. In other words, Coca Cola had few sympathizers
in the Indian government, but that didn’t stop the company. Coca Cola’s idea was to become entrenched
in Indian culture before the government could really respond. After all, in those early years independent
India had much bigger problems to deal with than a foreign fizzy drink. Thus, while India was recovering from a bloody
conflict with Pakistan, Coca Cola was busy setting up a distribution network across the
country. Coca Cola’s timing was perfect: just a few
years later Pepsi was denied entry into the Indian market while Coca Cola was making bank. Coca Cola’s success in India, however, would
eventually become its undoing. As successive governments leaned ever further
towards the left, Coca Cola became public enemy No. 1 in the eyes of Indian politicians. A favorite statistic of theirs was the fact
that while only 10% of India’s villages had safe drinking water, 90% had access to
Coca Cola. In the eyes of a protectionist government,
Coca Cola being more accessible than water was a very bad sign, but overthrowing the
powerful American company would not be easy. Coca Cola had indeed become entrenched in
Indian society and it would took a very severe crisis to bring it down. Such a crisis did happen in the mid 1970s,
when India was actually on the brink of revolution. Following a third war with Pakistan and an
almost dictatorial control of government by Indira Gandhi, civil unrest against the socialists
was growing out of control. Nationwide strikes and political assassinations
were becoming the norm and to deal with that, Gandhi issued a state of Emergency between
1975 and 1977. This dark period of Indian history saw thousands
of political opponents thrown in jail, a total suspension of civil liberties and government
control over the press. It also presented a great opportunity for
the government to finally throw Coca Cola out of India. Amidst the chaos, the socialists enacted a
law that prevented foreign companies from owning more than 40% of any business in India. Coca Cola would have to effectively give up
its ownership and more importantly: it would have to surrender its secret recipe and to
make it locally in India, rather than importing it from the US. Faced with little choice, Coca Cola left India
in 1977 alongside more than 50 other American companies and this left a huge void in the
Indian soda market, not just for Coca Cola but for Sprite as well. Local competition was of course happy at this
opportunity and over the next decade they expanded rapidly, filling the market with
substitute products. Even the government cashed in by creating
a state-sponsored cola called Double Seven to commemorate the end of the Emergency. Coca Cola, however, is not so easily defeated,
and when the socialists finally lost their grip on India in 1991, Coca Cola came back
with a vengeance. Riding a wave of economic liberalization,
Coca Cola re-entered India in 1993 and that very same year they acquired the most popular
brands that had developed in their absence. In fact, all four sodas I mentioned earlier
were purchased by Coca Cola for $40 million, giving the company a staggering 50% market
share from day one. Since then Coca Cola’s domination has only
increased, and today their share has risen to just over 60%, with its only real competitor
being Pepsi at around 35%. So despite decades of political opposition,
Coca Cola did eventually conquer India and the way it did so was honestly quite the power
move. And speaking of power moves, Audible, who
were kind enough to sponsor this video, have just released Adam Grant’s new book of the
same name. In Power Moves you’re gonna hear the insights
of over twenty leaders in business and technology on the shifting nature of power in the modern
world. You can download and listen to Power Moves
for free alongside a free trial of Audible if you visit audible.com/businesscasualpower
or if you text “businesscasualpower” to 500500. In any case I’d like to thank you for watching
this video and I encourage you to share it around with your friends and to also follow
me on Instagram, where I’m gonna post awesome teasers for future videos. You can expect my next video two weeks from
now, and until then: stay smart.

Maurice Vega

100 Responses

  1. Well nowadays Coca Cola is again going down in India people are getting aware that coke damages their health

  2. What is the term socialist powers ?????
    We are a welfare state and Socialism is in our Constitution
    The country is written in socialism

  3. Caffeine and sugar free soda sucks. If you don't like caffeine and sugar you should be drinking tea or decaffeinated coffee or sparkling water.

  4. wait, so only 10% of the villages in the country had clean water, and the priority went to taking down a company?

  5. Do you have pepsi and Philippines? Especially on that winning – losing crown issue. I'm not sure if it's considered a scandal. If not, please make a vid thank you.

  6. The preamble in the Indian constitution includes Socialism and to this date is responsible to it being one of the most corrupt state on the planet.

  7. Capitalism did not spread around the world in 20th century as has been written infinitely in the first chapter of economics books. Capitalism has been here since whenever humans started trading which is basically forever, only the scale kept changing. If it was true that capitalism spread around the world in only the 20th century how is it that all languages have a word for a market for e.g. a bazaar? After all, a market and capitalism are two sides of the same coin.

  8. The fact that only 10% had access to safe water shows the incompetence of the Indian government whilst coca cola managed to get there product to 90% of the population is genius.

  9. Well done "Business casual'. I have been enlightened a lot by your posts.
    Can you do something on Pixar and Dreamworks too? I am looking forward to seeing it.

  10. Indira Gandhi destroyed Indian Economy by following too muchh pro communist economy
    Hwr then Economic Advisor was pro USSR ambassdor.
    Her Nationalisation of Banks was important but she took it too mext level

  11. 2:04 90% of villages had access to coca cola? From where did you get this cause this sounds incredible. You're telling me that coca cola stores were established in villages all around the country from Himalayas to the jungles of Burma and people there had coca cola, first this is a logistical nightmare considering the shity transportation and infrastructure in India especially back in the 50s where the country was a shithole? And Even if you manage to bring products you are faced with the biggest obstacle of selling them. Legit sure no Indian could afford any drink, let's don't consider that energy drinks were an alien concept for the Indian culture.

  12. I use Coca-Cola & Pepsi as toilet cleaner ๐Ÿšฝ ๐Ÿ˜‚๐Ÿ˜‚๐Ÿ˜‚๐Ÿ˜‚๐Ÿ˜‚

  13. Coca Cola: supplies 90% of the population
    Indian government: supplies 10% with tap water.
    EPIC FAIL!!!๐Ÿคฃ๐Ÿคฃ
    ps.: India wasn't full blown socialist at the time, but it experimented with socialist policies and kept good relations with the USSR for some reason…๐Ÿคจ

  14. I almost studied nothing of emergency during school. May india never have a witch as the pm.

  15. Lemon juice with salt and sugar is the best you can get.Lemon soda is also Great ๐Ÿ‘๐Ÿ‘๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ

  16. I am just happy that we had FEMALE DICTATOR.๐Ÿ˜‚๐Ÿ˜‚๐Ÿ˜‚๐Ÿ˜‚๐Ÿคฃ๐Ÿคฃ๐Ÿคฃ๐Ÿคฃ๐Ÿ‘๐Ÿ‘๐Ÿ‘๐Ÿ‘๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ๐ŸคŸ

  17. Nope nope … Are managed to buy thumbs up… Because they have formed syndicate with Pepsi…
    Shows how company destroying local market.

  18. The void that was created in 1977 led to the growth of several indian industries including the IT Section…wipro,Infosys etc got the golden period to grow…

  19. Lassi is more preferable in India …..love you lassi coke is toilet cleaner and stomach cleaner for obese people of America….

  20. Simple, Coca-Cola used pesticides in their contents & this was found out by accident after a student did a test on the drink. After that, Coca-Cola just went down the drain, literally.

  21. Indian's are the most uncreative bastards in history during Coca Cola's exit in 1977 what the fuck did they achieve other than making unmarketable shitty names such as Citra, Bisleri, Maaza, Gold pot. Indian people who make brand name have no sense of globalism and ought to take a cyanide pill and off themselves.

  22. Coco cola is foolish indira gandhi was a corrupt prostitute why didnt you bribe her she would've given u her ass

  23. problem with your videos is your accent. sorry man great content, but eastern european accent makes hard to listen

  24. Oh, say! can you see by the dawn's early light What so proudly we hailed at the twilight's last gleaming; Whose broad stripes and bright stars, through the perilous fight, O'er the ramparts we watched were so gallantly streaming? And the rocket's red glare, the bombs bursting in air, Gave proof through the night that our flag was still there: Oh, say! does that star-spangled banner yet wave O'er the land of the free and the home of the brave? On the shore, dimly seen through the mists of the deep, Where the foe's haughty host in dread silence reposes, What is that which the breeze, o'er the towering steep, As it fitfully blows, half conceals, half discloses? Now it catches the gleam of the morning's first beam, In fully glory reflected now shines in the stream: 'Tis the star-spangled banner! Oh, long may it wave O'er the land of the free and the home of the brave! And where is that band who so vauntingly swore That the havoc of war and the battle's confusion A home and a country should leave us no more? Their blood has washed out their foul footsteps' pollution! No refuge could save the hireling and slave From the terror of flight or the gloom of the grave: And the star-spangled banner in triumph doth wave O'er the land of the free and the home of the brave. Oh, thus be it ever, when freemen shall stand Between their loved home and the war's desolation! Blest with victory and peace, may the heav'n-rescued land Praise the Power that hath made and preserved us a nation! Then conquer we must, when our cause it is just, And this be our motto: "In God is our trust": And the star-spangled banner in triumph shall wave O'er the land of the free and the home of the brave.

  25. It is beyond perverse that a processed man made beverage would be more accessible than clean drinking water. I love Coca-Cola but I would rather have ubiquitous clean drinking for everyone before Coca-Cola for anyone.

  26. Here in ๐Ÿด๓ ง๓ ข๓ ณ๓ ฃ๓ ด๓ ฟ Coca Cola is not the most purchased soft drink.
    The market leader is IRN BRU .

  27. It's weird that its competitor Pepsi, had access to invest businesses in the Soviet Union a socialist country.

  28. What kind of fool still clings to socialism? Marxists are just a bunch of charlatans. NEVER believe anyone who is full of bright & happy promises.

  29. That's not true. Coca Cola can be purchased very easily in North Korea but most are likely to be imported from China. And it is really true that only Americans are inclined to believe some nonsense tabloid like reports about North Korea.

  30. Unhealthy coca cola had been draining india fungible water supplyto make the poop watery drink… no thanks it death, as may rely on water to farm,and they stealing it away. Stay away from western foods as most of chemical laden perservative, man made fake foods, gmo foods…. toxic to body cause diseases.

  31. There was never a India Pakistan war in 1947 but instead Britishers left the country and divided two nations that killed many people get your facts right

  32. When cocacola came back to India they threatening their biggest Indian enemy 'Thumbs Up' to sold themselves to cocacala until they serve free drinks for a year. This complete killed a pure Indian brand. Now a day thumbs up is still more popular than cocacola, even after becoming a cocacola brand.

  33. India shot itself in the foot by embracing socialism and protectionism (China too till 1980). Anything before 1947 could be blamed on the English but remaining poor 70 years on is all on them. Singapore, equally poor at the time (also a former British colony) became a first world country by pursuing the exact opposite policy.

    "you make profit into a dirty word and Singapore dies" – Lee Kuan Yew

  34. Idiot & Bigoted "Business Caual" get your facts correct. Indira Gandee rigged her election and it was exposed in court and to escape disqualification and jail, she blamed the whole country, judicial system, opposition, etc…. "claiming the grapes are always sour" she declared "State of Emergency" on the advice of a crook from Kolkata and jailed all the opponents and other among her distaste. There were no political assassinations as such, but her hardcore opponents just got disappeared…. Just like that… Because like her father she believed in Ahimsatmak eliminations

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