Coca-Cola's Ilan Sobel

Making Coke hip among local teens while introducing new drinks to families

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SHANGHAI -- When Ilan Sobel took over Coca-Cola's top marketing post in China last year--general manager, strategic marketing & innovation--he faced two immediate challenges: stemming Pepsi's strong connection with young adults while helping Coke transform China's beverage industry.

Long a nation of tea drinkers, Chinese are still growing accustomed to western-style sugary carbonated sodas. They also have a growing number of options among the steady stream of new fruit drinks, waters, flavored teas, chilled herbal remedies and even canned coffees, some of which are produced by Coca-Cola, now appearing on store shelves.

"There are so many companies competing for the hearts of Chinese consumers," said Mr. Sobel, 32. "Every multinational is going for a share of consumers' wallets now. We see our competitors as not just other beverage companies--even though the beverage market is a competitive marketplace--because really everyone is a competitor."

To strengthen Coke's connection with local consumers, Mr. Sobel has placed greater emphasis on "big, bold breakthrough programs based on insights about what inspires our consumers, their passions and interests."

Taking advantage of teens' obsession with online games, for example, he forged a marketing alliance with the creators of one of China's hottest games, "World of Warcraft" (WoW), decorating the interior of 10,000 Internet cafes in key Chinese cities with elaborate WoW and Coke branding, even bringing the game to life with a massive three-day carnival in Shanghai last June.

The adoption of new technology in China is extremely fast. "Consumers yearn to experience it and use it to bring out their own self-identity, through games, mobile phones, blogs," explained Mr. Sobel. "The essence of the whole insight is helping consumers to express themselves. The Coke brand now helps them realize it in every campaign, through a defining moment where the hero, or celebrity, goes his own way."

China is one of Coca-Cola's "critical" countries, as the fifth-largest Coke market in the world by volume, following the U.S., Mexico, Brazil and Japan.

"We are making enormous strides. As income levels continue to rise in China, beverage consumption will continue to expand," said Mr. Sobel. "[While] every market worldwide is striving to gain greater volume and value share, obviously China's role is extremely important."

A lean, energetic South African who has lived in the U.S., Israel, Australia, Hong Kong, Thailand and now China, he is regarded as one of the company's most dynamic innovators in Asia.

"He is extremely passionate about the business, he has a really solid grasp of the company's goals, the bottlers' requirements, and, importantly, what's right for the brand," said Jeff Delkin regional business director, Asia/Pacific for Coca-Cola at Ogilvy & Mather, based in Shanghai.

"Ilan's arrival should make China's soft drink category a lot more exciting, based on what he did in Hong Kong. Coke was hugely dynamic in the years he was there in areas like flavor extensions," said Shanghai-based Darryl Andrew, managing director, China at Synovate, Aegis Group's market research division.

Under his supervision, Coke's Hong Kong division was a hothouse for product innovation, churning out new beverages like Sprite Ice, Sprite on Fire, Fanta Lactic, Nescafe Ice and Nestea Ice Rush. Earlier in his career, he engineered the marketing strategy for Coca-Cola's Nam Thip, now the leading bottled water brand in Thailand.

"He's worked across much of the product portfolio with experience in innovation and launching new beverage categories, and is extremely well-versed in marketing the core products in the portfolio," said Mr. Delkin.

Experience with innovation is particularly important in China, where Coke's fastest-growing new products are not carbonated drinks. Its latest hits are a special formulation of Minute Maid with extra pulp, marketed with packaging that resembles a real orange, and Modern Tea Workshop, a green tea with herbal additives that promote health. Coke plans to introduce both products in other Asian markets.

Mr. Sobel has placed "enormous importance" on ensuring the whole Coca-Cola company has a fair share of growth, especially outside the carbonated beverage market, said Donald Chan, managing director, Leo Burnett, Shanghai, which handles creative for Minute Maid. "They were kind of a latecomer in this area in China, but now they are placing a lot of importance on new product development."

Cheat Sheet

Who? Ilan Sobel, Shanghai-based general manager, strategic marketing & innovation for Coca-Cola's beverages in China since July 2004

Last job? Coke's director-regional manager for Hong Kong, Macau and Mongolia, based in Hong Kong

Age? 32

Favorite Coke drink? "Always [brand] Coca-Cola."

Favorite Shanghai restaurant? Simply Thai in Xintiandi

Favorite Shanghai hangout? "My home, to spend more time with my wife and new-born baby boy."

Most challenging thing about living in China? "The scale and pace of the country. To fully understand this vast and rapidly-developing country is a challenging and fascinating experience."

Top tip for foreigners in China? "Thing BIG, anything is possible in this fast-growing market. Leverage your entrepreneurial spirit and you will be amazed at what you can accomplish."

Most surprising thing he's learned about Chinese consumers' "Coming from a culture of collectivism, Chinese consumers, especially the younger generation, are highly individualistic and display a very strong aspiration to express themselves in their own unique way."

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