Mother might know best

After three US-developed brands flopped in Australia’s A$450m [£180m] energy drink market, Coca-Cola’s local company has decided in frustration to develop its own product and will launch in January. Coca-Cola Amatil’s new brand, which will be called Mother, will replace Recharge, first rolled out in 2004 but now being pulled from stores after sinking to 3.8% of the market, ranking it a distant third behind market leader V and Red Bull.

The Coca-Cola Company’s earlier efforts were Lift Plus and Burn, both launched in 2000 – the latter only in night clubs – but also pulled after three years, writes Selwyn Parker.

At this stage there is no indication that Mother, if successful, might be deployed in other markets beyond Australia to help Coca-Cola combat rival energy drinks, in particular Red Bull.

Meantime, in Australia, the pressure is on Mother to lift her skirts and perform. Coca-Cola Amatil cannot afford another failure in a sector which has averaged 20% growth over the last four years and now accounts for a quarter of the A$2bn [£800m] total soft drinks sector.

The Coke companies have refused to discuss the new brand, whose imminent release has only been revealed by retailers, but it’s understood they have budgeted A$10m for the launch and aim to grab an ambitious 10-15% share of the market by the end of 2007.

However Mother’s rivals are determined to consign her to the same fate as the Coke companies’ earlier attempts to crack the sector. Frucor Beverages, the Groupe Danone-owned company that produces V, plans to triple its support budget next year from A$4.5m to A$15m.

Red Bull Australia, which boasts easily the biggest budget, will invest A$20m, the same as in 2006 when it backed a wide variety of events including an air race.

Those budgets have produced the desired results. The V brand’s market share stands at 56.2% while Red Bull has 36.3% from a late start.

"Red Bull and V are very strong brands and very well entrenched with consumers," Red Bull’s director of sales, Mike Stacey, told the Australian Financial Review in December. Although he didn’t underestimate the Coca-Cola companies distribution power, it was going to be hard for Mother to make an impression.

© db 20 December 2006