New Faces at Coke, Pepsi in China Signal Emphasis on Digital Media

Both Bring in New Blood as Struggle for Soft-Drink Supremacy Moves Online

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SHANGHAI, China ( -- One of the biggest marketing battles in China will shift fronts -- to digital -- this month as Pepsi-Cola and Coca-Cola Co. replace top
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Both Coke and Pepsi operations in China are shifting toward a heavier dependence on the Internet to reach young Chinese consumers.

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marketing executives who have fought for the world's fastest-growing soft-drink market.

Online emphasis
In a clear sign it believes online entertainment is the way to reach young Chinese, Pepsi is hiring a digital-media expert with no soft-drink experience to replace Richard Lee, VP-marketing Greater China, who moves to New York in January to take a new global Pepsi post. Former MTV Networks executive Harry Hui joins Pepsi this month after five years as Hong Kong-based president-Southeast Asia of Vivendi's Universal Music, where he led the company's aggressive digital-media strategy. Although his formal title has not been announced, Mr. Hui, 42, will be Pepsi's top marketing gun for China, Hong Kong and Taiwan.

At Coke, Ilan Sobel, general manager-strategic marketing and innovation, China, a young turnaround expert who made Coke's Hong Kong division into a new-product hothouse before moving to China in 2004 to rejuvenate Coke's staid image there, is returning to his native South Africa for personal reasons. Coke is hunting for his replacement.

Pepsi Creative Challenge
Both marketers have emphasized digital media to appeal to young Chinese, who typically shun TV in favor of the internet and online games. Mr. Lee, 41, made user-generated content the centerpiece of his largest campaign last year, the Pepsi Creative Challenge. Online users submitted ideas for a Pepsi spot, voted on the best scripts and participated in online auditions. Since joining Pepsi in 1997, Mr. Lee has transformed Pepsi from underdog to one of China's hottest youth brands, doubling market share to 22%.

Mr. Sobel has given Coke a much-needed boost by linking it with one of China's hottest computer games, "World of Warcraft." Coke decorated thousands of internet cafes in key Chinese cities with elaborate "WoW" and Coke branding, even bringing the game to life with a massive carnival.
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