INCA KOLA MANUEL SALAZAR: [LIMA, PERU]

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Not many marketers have Coca-Cola running scared. But since his return to Peru's Inca Kola four years ago, director of operations Manuel Salazar, 55, has performed a true market first: Harvard Business School calls it the Peru Case , the only market where Coke trails a local soft drink.A recently opened McDonald's in Lima serves the greenish bubble-gum flavor soda on tap, while Coca-Cola marketing gurus are rumored to be shuttling between Atlanta and the Peru vian capital, trying to figure out what's going on even as Inca Kola invades North America, Europe and Asia with sales growth of 25% during the past three years. "We have a top-quality product and brand," said Mr. Salazar, who re vamped the 85-year-old brand. That may be true, but he's being modest about his contribution. The genius lies in Mr. Salazar's detail to marketing in Inca Kola's largest market, Peru.Over the past two years, Mr. Salazar has introdu ced a popular diet version that claims 4% of sales primarily from upper-class segments that usually prefer imports, launched large disposable bottles that now account for nearly one-third of sales, expanded distribution to affluent neighborhoods and supermarkets, and strengthened the image of "Peru's national flavor" with a TV campaign, by Lima-based Properu/ Lintas, that resembles Coke or Pepsi's vignettes of healthy-looking sports enthusiasts, like blond bodybuilders or young mountain bikers, sipping sodas.As a result, Inca Kola registered 15% sales growth in 1994 and 1995 in Peru, stealing share from Pepsi and Coke. And the good news continues for the company, which finally broke even in 1995 after several years of losses and saw sales slip only 5% during a Peruvian recession that sliced soft drink consumption by 15% this year. The brand's 33.8% share now tops Coca-Cola's 32.8% stake in Lima, home to one-t hird of the population and the country's largest market.Inca Kola's thirst for success, however, is far from quenched. In Peru, where Coke claims a 26% share nationwide, Mr. Salazar plans a national corporate marketing campaign early next year to boost his brand's 20% market share across the country.Already, most Peruvians agree that Inca Kola's fruity blend is the perfect companion to the country's rich cuisine. A "typical" dish, it seems, becomes more tr aditional with an Inca Kola next to it. Even the country's immigrant Asian population has adopted the beverage. Often, it is the only soft drink available in the numerous Chinese restaurants, known as chifas.Mr. Salazar, who started with Inca Kola more than 25 years ago and left to manage other companies, including the country's biggest milk producer, joined Inca Kola when it was in a state of flux. In 1992, Johnny Lindley, grandson of founder J.R. Lindley a nd currentpresident of Inca Kola, decided to install some professional management to the family company after taking over the reins from his father. Mr. Salazer was part of the new team hired, and so far he's proved the right man for a big job.
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