sip on this

Kraft Adds Tang to its Billionaire Brands Club

Posted by Mark J. Miller on June 20, 2011 02:30 PM

If Travie McCoy really wanted to be a billionaire, he might have thought about going into inventing a powdered drink that was used by early astronauts rather than songwriting. 

It’s not clear how much the inventor of Tang, General Foods scientist William Mitchell, ever made from the 54-year-old brand (he also dreamed up Pop Rocks and Cool Whip), but the owner of Tang, Kraft Foods, now reports that Tang is pulling in $1 billion in revenue annually.

That makes it Kraft’s 12th billion-dollar brand, joining Oreo cookies, Trident gum, Maxwell House coffee, and eight others in the revered category.

Five years ago, it wouldn’t have been easy to predict that Tang would join the elite tier of Kraft brands, which collectively generated $49.2 billion in sales last year.

Despite its ties to the US space program, credit for the brand's growth goes to Kraft's international marketing strategy, particularly in emerging markets. The Wall Street Journal reports that Tang has doubled its sales in the last four years by pushing the brand in Argentina, Brazil, Mexico, the Philippines, and the Middle East.

“Kraft's push involved new flavors, sizes and formulas of Tang, each trying to cater to the local needs,” the Journal notes, and Kraft execs began to see Tang as a real competitor to sodas and juices.

"Innovation on flavors has made it much more appealing than just a conventional orange flavor and that's one of the things that especially attracts people from other beverages," Sanjay Khosla, Kraft's president of developing markets, told the Journal.

Those new flavors were sometimes directed at the local market, the paper notes. “Flavors like ponkan, a citrus fruit, were added in the Philippines, and lemon-mint to the Middle East,” the Journal reports. “In Brazil, as well as the Philippines, Tang was fortified with iron and other minerals that children weren't getting enough of in their diets.”

 

"Our business model in developing markets of giving local leaders freedom within a framework to act like entrepreneurs has been tremendously successful — Tang is no exception," states Khosla in a press release. "With an entrepreneurial spirit, our Tang teams across the world connected virtually to harness our global powdered beverage technology and expertise. They used a glocal approach, combining the best of global and local to transform Tang."

At more than three times the size of its nearest competitor (according to Euromonitor), Tang quenched the world's thirst with more than 20 billion servings in 2010 across 90 countries.

While boosting the ranks of its $1 billion club is certainly sweet for the folks at Kraft, the Journal points out that Tang has a long way to go till it’s a major player in the worldwide beverage ruling class.

“Tang sold the equivalent of 20 billion drink servings last year,” the paper reports. “Coca-Cola Co. passes that mark every 12 days, and its namesake soda sells that much in less than a month.”

 

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