Thailand's Cola Conflict: Est Vs. Pepsi

[webfact]

Thailand's Cola Conflict: Est vs. Pepsi

By Shane Danaher and Praj Kiatpongsan

Serm Suk announced plans to spend THB1.5 billion advertising Est. Photos: Praj Kiatpongsan

BANGKOK: -- Nearly two months after the launch of soft drink upstart Est, Thailand’s soda giants are racing neck-and-neck for the country’s carbonated crown

Ramet Rattanakansang enjoys his soda. By the 36-year-old Bangkokian’s own admission, he drinks a bottle a day, and on Tuesday of last week, that bottle happened to hold 12 ounces of Thailand’s latest soft drink upstart—Est.

A syrupy brown cola, Est tastes somewhat like Pepsi, mixed with root beer and tempered with a gargantuan helping of sugar. The soda is scarcely two month old, but so aggressive is its marketing that Est is already being mentioned in the same breath as some of its most intimidating rivals.

“I still prefer Pepsi to Est,” says Ramet, “but I couldn’t find any Pepsi cans so I have to switch to Est for the moment.”

Ramet’s brand dilettantism might represent a qualified victory for Est, but still, it can’t be anything but music to the ears of Serm Suk—the Thai bottling and distribution company that has wagered more than one billion baht in its bid to claim the top spot in Thailand’s soft drink scrum. [more...]

Full story: http://www.coconutsbangkok.com/features/thailands-cola-conflict-est-vs-pepsi/

-- COCONUTS Bangkok 2012-12-27

[gl555]

I surprisingly find myself liking the taste of EST more then Coke and Pepsi. I think it's because of the root beer.

[hkt83100]

Does it come including Insulin?

[lemoncake]

But still no word or indications of what happened to all the Pepsi and Pepsi max.

Ok so they broke the contract and Pepsi is not leaving Thailand soooo where is all the Pepsi ?

Not a smart move by Pepsi to leave the shelves empty for a while as many may switch brands

[virtualtraveller]

This is another shameful example of business ethics here, Est is produced by the company that previously had a contract/partnership with PepsiCo, for manufacture and distribution. Obviously that came to an end, and seeing how Est suddenly and aggressively substituted itself everywhere for Pepsi you can guess what went on, they had planned this, developed their own cola secretly and put everything in place for a quick gain after telling Pepsi to hit the road jack. I read somewhere a quote from a 30 year offspring of the family who own it, boasting they aim to become the No 2 cola in Thailand within a year using a 15 million marketing budget. Well, they are now, though Coke sales have soared. But I find Est a cheap imitation and refuse to buy it on principle. Six months from now I'm sure Pepsi will re-enter the market with an even bigger budget and xxxx them up. Biggest loser will be Big Cola.

Edited December 27, 2012 by metisdead

[Curt1591]

But still no word or indications of what happened to all the Pepsi and Pepsi max.

Ok so they broke the contract and Pepsi is not leaving Thailand soooo where is all the Pepsi ?

Not a smart move by Pepsi to leave the shelves empty for a while as many may switch brands

Serm Suk is not only the bottler, but the distributor. Lots of logistics for Pepsi to hammer out.

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

[Halion]

Regardless of all the covert skulduggery which typifies this country, I will not buy EST , partly on principle but mostly on taste.

If I want root beer, then I woud buy root beer and not something that is struggling for an identity.

I also noticed that it appeared on the shelves and in the stalls like a tidal wave but I now see that many stalls are droping it and in my local Tesco where Pepsi and coke are often depleted the stock of EST seems to diminish very slowley. Only time will tell but I think EST will go the way of the Dodo.

[singa-traz]

Tried once when I asked for Pepsi and the "Est" bottle landed on the table. Taste like detergent.

"Est" to fight with a brand like Pepsi? Looks like a lose/lose proposition and a winning one for Coca Cola, at least for now.

At the few places where they used to sell Pepsi ... I prefer to drink water.

[BookMan]

Hard to feel sorry for Pepsi IMO. They have used their mega corporation tactics for years to get market share.

Now EST comes onto the market... looking very much like pepsi, using the bottling plants and distribution network built up by pepsi. (tasting different obviously) What would be a clear commercial rip off in many countries.

This is just two big companies slugging it out. Long term I would be putting my money on Pepsi as they can afford to throw more cash around.

As for me I remain unaffected, rarely drinking any carbonated beverage.

[angsta]

Double Post.

Edited December 27, 2012 by angsta

[angsta]

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

Which companies? You say many, I would like to hear the name of just one. Sorry mate but you are making this up.

The whole of Asia thinks it's the shits. Japan, Korea (x1000), Vietnam. I think Pepsi do pretty well in those places. Let us revisit this situation in 6 months. There will be no Est.

[Thai at Heart]

But still no word or indications of what happened to all the Pepsi and Pepsi max.

Ok so they broke the contract and Pepsi is not leaving Thailand soooo where is all the Pepsi ?

Not a smart move by Pepsi to leave the shelves empty for a while as many may switch brands

Serm Suk is not only the bottler, but the distributor. Lots of logistics for Pepsi to hammer out.

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

Story is that Pepsi will go with Singha for distribution. Bing. Ready made distribution line

[scratchy]

Who cares wouldn't drink any of the filth anyway, theres much healthier drinks to spend yourmoney on

[Mekong Bob]

What about Diet Pepsi, Pepsi Light, or (in Thailand) Pepsi Max?

Many of us prefer sugar-free Pepsi, in cans. Some of us cannot consume large amounts of sugar.

Also in the news is a new artificial sweetener to replace NutraSweet in Diet Pepsi, coming on line in early-2013.

[jbrain]

But still no word or indications of what happened to all the Pepsi and Pepsi max.

Ok so they broke the contract and Pepsi is not leaving Thailand soooo where is all the Pepsi ?

Not a smart move by Pepsi to leave the shelves empty for a while as many may switch brands

Serm Suk is not only the bottler, but the distributor. Lots of logistics for Pepsi to hammer out.

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

Story is that Pepsi will go with Singha for distribution. Bing. Ready made distribution line

PepsiCo unveils Bt18.4bn plan for Thai investment

The company has appointed a global logistics firm - DHL - as its logistics and warehousing partner for Thailand. It also works with local distribution partners, which will handle production distribution and logistics in the five regions throughout the Kingdom and via the company's 50 distribution points.

http://www.nationmultimedia.com/business/PepsiCo-unveils-Bt18-4bn-plan-for-Thai-investment-30193061.html

[bonobo]

Pepsi attempted to buy out Serm Suk. The Serm Suk board of directors thought Pepsi's offer was too low, and they rallied the stock holders to vote down the acquisition by a very slim margin. They then went to ThaiBev and asked them to buy a significant share in the company.

Pepsi was left high and dry without a bottler, so they built their own facility in Rayong. However, they also were left without a distributor, so they signed on with DHL for that. There are many doubts that DHL can service the vast number of small food and drink stands that accounted for a huge percentage of the Pepsi market.

Pepsi was also left without a bottle supplier (ThaiBev had been the supplier.) Bottles accounted for 47% of Pepsi's market, according to information put out by Sern Suk.

WIth regards to some of the above comments, Sern Suk did not break any contract with Pepsi. The remained working together until the contract they had expired. And Pepsi is not using SIngha for distribution.

[spacemand]

What about Diet Pepsi, Pepsi Light, or (in Thailand) Pepsi Max?

Many of us prefer sugar-free Pepsi, in cans. Some of us cannot consume large amounts of sugar.

Also in the news is a new artificial sweetener to replace NutraSweet in Diet Pepsi, coming on line in early-2013.

I used to prefer Pepsi Max but switched to Coke Zero when its available after they switched their sweetener.

I live in Sisaket and Big C or Tesco most of the time have the 1.24-1.45 bottles of either product so when I see it I stock up for a while.

Went to Ubon Makro and no Pepsi products at all then went to Big C Ubon and plenty of Pepsi and Pepsi Max.

Pepsi seems to have a distribution problem but in the last few weeks it have gotten better.

[Curt1591]

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

Which companies? You say many, I would like to hear the name of just one. Sorry mate but you are making this up.

The whole of Asia thinks it's the shits. Japan, Korea (x1000), Vietnam. I think Pepsi do pretty well in those places. Let us revisit this situation in 6 months. There will be no Est.

Well mate!

"Pepsico" goes far beyond the "refreshment" brands it publicizes. Its investments are varied

One that I have personal experience with is a chain in the US called Pioneer Chicken. In the 80's a friend owned a franchise. Pepsi demanded a controlling interest in the company, or they would pull their brand. Pioneer has since served up Coke.

I have no reason to believe that they have become less predatory.

[Sam Drucker]

Though the promotion/advertising seems pretty solid, what the hell does "est" mean (besides being an abbreviation for Eastern Standard Time)?

This is an interesting battle to observe. Although Coca Cola is benefiting at the moment, my guess is that both Coke and Pepsi would have preferred this event (local bottler drops the worldwide brand and develops it's own) had not happened. If est becomes a success, Coke and Pepsi are in for potential trouble with their other independent bottlers around the world that are surely watching this unfold with interest.

The article was very informative about the Thai preference for glass bottles . . . didn't know that!

As for Coke benefiting at the moment and with a 55% market share last month, and running it's plants all-out, 3 shifts a day, I wonder if that's the reason Coke Zero (in the big 1.25 L bottles) has disappeared from the shelves?

[ezzra]

Not to worry guys, a giant conglomerate like Pepsi Co didn't come to be so powerful

by letting a " Thai bottler" stops it from doing what they have been doing best for many

many years, even before that "Thai bottler" was even born,

Time and place for every thing, and when the right time will come Pepsi will be in

to the Thai Market with a vengeance and this EST dish washing tasting beverage will

get what it's deserve,,

[Bluespunk]

Tried est and will not do so again. It tastes like recycled buffalo water.

[SamuiRes]

PepsiCo unveils Bt18.4bn plan for Thai investment

The company has appointed a global logistics firm - DHL - as its logistics and warehousing partner for Thailand. It also works with local distribution partners, which will handle production distribution and logistics in the five regions throughout the Kingdom and via the company's 50 distribution points.

http://www.nationmul...t-30193061.html

Well that's Samui off the list then. DHL do not know where Samui is. Anything sent via DHL to Samui ends up in the post from Bangkok. Last tracking schedule we had - Hong Kong - Cincinatti - Hong Kong - Bangkok - Phuket - Bangkok - Hong Kong - Bangkok - Phuket - Bangkok then EMS to Samui. Many such stories like this. Hopeless company.

[HUAHIN62]

Lets go back a little bit. Pepsi used this guy to do their bottling and distribution in Thailand for many years (20 to 30). They did it so well that Pepsi out sold Coke, one of the few markets in the world to do so. Pepsi however refused to consider a request from their Thai partner to decrease the price for their concentrate/royalties, which was squeezing the local companies margins. After the two parties couldn't agree to renew the contract last year, the Thai company announced that they will launch their own soda. Est will hurt Pepsi's market share in Thailand and Coke has already benefitted from Pepsi's move (they now have 55% of the market share). Est is cheaper is locally made and now is available at more places than Pepsi. What Est did was simple. They knew all the people who bought Pepsi in the past, they send out their trucks, off loaded Est, loaded the empty Pepsi bottles. Over night Pepsi disappeared and Est appeared. Pepsi made a mistake and will pay for it as it's not easy to regain lost market share. The arrogance of big companies is sometimes astounding.

[IAMHERE]

EST = Extra Sugar Thailand

Of course all ingrediants are subject to regular business practices; I tried it with Blend 285, I tried it with Sang Som, I tried it straight. I'll use Coke until Pepsi gets situated.

[wayned]

Tried est and will not do so again. It tastes like recycled buffalo water.

So you've tasted recycled buffalo water!

[pkspeaker]

Your obviously a big fan of monopolies and oligopies, and foreigner's getting a cut everytime someone in Thauland buys a soda or hamburger.. I on the other hand am going to EST 'on principal' (actually I won't because I would never punish my stomach and intestines by drinking cola in the first place)

COLA was invented in the 1800s , pepsi and coke do not have patent on COLA, long expired, anyone can make cola if they want..

and while the Thia's are at it, how about a better fast food burger chain then that crappy mcdonalds and burger king.. i was foolish enough to buy a burger king last week and it was like SO MUCH smaller than the illuminated picture behind the counter.. SCAMMED

This is another shameful example of business ethics here, Est is produced by the company that previously had a contract/partnership with PepsiCo, for manufacture and distribution. Obviously that came to an end, and seeing how Est suddenly and aggressively substituted itself everywhere for Pepsi you can guess what went on, they had planned this, developed their own cola secretly and put everything in place for a quick gain after telling Pepsi to hit the road jack. I read somewhere a quote from a 30 year offspring of the family who own it, boasting they aim to become the No 2 cola in Thailand within a year using a 15 million marketing budget. Well, they are now, though Coke sales have soared. But I find Est a cheap imitation and refuse to buy it on principle. Six months from now I'm sure Pepsi will re-enter the market with an even bigger budget and xxxx them up. Biggest loser will be Big Cola.

[WAERTH]

It is horrible (the taste of Est) They are squeezing the mom and pop shops they supply. stock Pepsi and we will not deliver anything anymore is what these shops are told I was told by the owner of the store in my condo downstairs.

In my years in Thailand this is the 4th time I've seen this done. Pizza Company (Pizza Hut), Chang (Carlsberg). True (Orange) and now Est. It is clear Thai business partners will copy any foreign brands product and then boot out the foreign partner.

W

[Sydebolle]

All those being in the realm for a longer period of time it does ring compareable bells when the deal between Thai Bev/Charoen and Carlsberg Copenhagen went sour. It took Carlsberg 15 years to come back selling their ware through Singhas network; the beer though is brewed in Vietnam, i.e. not even a Thailand-neighbouring country. There is definitely a very clear writing on the wall.........

[caykay]

Pepsi is very aggressive in it's business policies. They have acquired many companies by refusing to supply product if the sale wasn't made. Many US restaurant chains switched to Coke because of this.

Pepsi's business model won't fly in Thailand, where nationalism rules.

Which companies? You say many, I would like to hear the name of just one. Sorry mate but you are making this up.

The whole of Asia thinks it's the shits. Japan, Korea (x1000), Vietnam. I think Pepsi do pretty well in those places. Let us revisit this situation in 6 months. There will be no Est.

Well mate!

"Pepsico" goes far beyond the "refreshment" brands it publicizes. Its investments are varied

One that I have personal experience with is a chain in the US called Pioneer Chicken. In the 80's a friend owned a franchise. Pepsi demanded a controlling interest in the company, or they would pull their brand. Pioneer has since served up Coke.

I have no reason to believe that they have become less predatory.

Pioneer chicken was bought out about two decades ago!

[worgeordie]

I dont think Pepsi will be very pleased that EST has the same

colour scheme as Pepsi, as when I first saw it and did not know

the full details of the story, I thought it was a new type of Pepsi.

Anyway I am not drinking anymore of those soft drinks,chemical

flavours,sugar and water.not good for my diabetes so the Dr.says

waters good enough and sometimes I make my own Ginger Beer.

I also see Pepsi selling at 20bht per 1.25 ltr bottle,so competition

is good for the drinkers of these soft drinks.

regards Worgeordie