China's Very Own Cola

As I was doing some routine blog readings, I came across this blog post about Future Cola, one of the successful Shan Zhai businesses that I mentioned in my recent article. I think it would be interesting to elaborate more on its rise.

Although it copied the packaging of Coca-Cola, Future Cola actually researched substantially on what flavor was tailored for the Chinese palate. Eventually, it came up with the taste, which it claimed to represent a healthy way to cool off the Chinese youngsters and clean out their fiery livers. With a strategy similar to BaWang’s, Future Cola targeted at overlooked consumers in lower-tier cities and rural areas. Taking advantage of Shan Zhai to achieve low production costs, Future Cola rapidly imported state-of-the-art equipment and localized production facilities. Furthermore, it leveraged the resources of its parent company, Wahaha Group, in order to establish a vast distribution network in target markets. More important, it launched an aggressive but very focused marketing campaign to build a brand image as “the Chinese people’s own cola.” Once mocked as a cheap copycat of Coca-Cola, Future Cola has now grown into the third-largest player in China’s carbonated soft drinks market after Coca-Cola and Pepsi, with a competitive edge in less developed markets. To expand its market presence further, Future Cola is even planning to challenge the two beverage giants by entering the first-tier markets.

This is just one of many stories about venturous and innovative Shan Zhai businesses.

The era of Shan Zhai seems to be on its way.