Coca-Cola’s Japan unit plans to launch its first ever alcoholic alcopop drinks in the country, It will be the first alcoholic drink produced by the company in its 125-year history, in a surprising departure for a US company identified with cola and other non-alcoholic beverages.
Coca-Cola will make “Chu-Hi” drinks, which are canned beverages that contain alcohol. The alcohol content of Chu-Hi alcopops ranges from 3 percent to 8 percent, and their popularity has grown between 5 and 25 percent year on year since 2013.
The drink, which usually has between three and nine percent alcohol and is marketed by leading Japanese beverage companies such as Asahi, Kirin, and Takara, is especially popular with young consumers and women.
“This is a canned drink that includes alcohol; traditionally, it is made with a distilled beverage called shochu and sparkling water, plus some flavoring,” said Jorge Garduno, Coca-Cola’s Japan president. “We haven’t experimented in the low-alcohol category before, but it’s an example of how we continue to explore opportunities outside our core areas”.
Fizzy-drinks sales have been in decline for Coca-Cola and its competitors, as younger generations are more conscious of sugar consumption. The company has experimented with water and tea to compensate for the declining sales.
“The Chu-Hi category is found almost exclusively in Japan. Globally, it’s not uncommon for non-alcoholic beverages to be sold in the same system as alcoholic beverages. It makes sense to give this a try in our market,” Garduno said.
If Mr. Garduño carries through with his plan, Coca-Cola Japan will be entering a crowded market dominated by local brands from companies such as the beverage units of Suntory Holdings Ltd. and Kirin Holdings Co.
According to Suntory, the total market in Japan for canned ready-to-drink alcoholic beverages has grown for 10 consecutive years. It grew 9% in 2017 to the equivalent of 183 million 24-can cases. About a third of those had the alcohol content of at least 8%, Suntory said.