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As Chinese New Year Approaches, Coca-Cola Faces Political Chill

Posted by Abe Sauer on January 5, 2012 11:03 AM

It used to be just enough to show up in the China market with your Western product, plop it down on the shelf, and watch as Chinese consumers — desperate for some of that sweet, sweet Western consumer goodness — snatched it up.

Times have changed. Today, Western brands must hustle like everyone else to demonstrate their value and win market share. This even includes Coca-Cola, a powerhouse global brand that boasts one of the best, most iconic brand reputations in the market. To this end, Coke has released its latest China campaign in a rather genius attempt to write itself into what is probably China's most powerful cultural tradition.

Known in China as the Spring Festival (春节), and in the West as "Chinese New Year," the nation's traditional holiday is Christmas, Thanksgiving, President's Day, Your Birthday and Flag Day all rolled into one. This year the weeklong falls on January 23.

In 2009, Coca-Cola launched a Chinese New Year campaign titled "First Coke of the Year." The ads feature popular Olympic gold medal-winning hurdler Liu Xiang. (Think China's Michael Phelps.) The inaugural spot leveraged Liu's heartbreaking decision to not participate in the Beijing Olympics due to injury.

During the campaign's 2009 run, Liu teamed up with Yao Ming for a "home visit" for a "news" item that may have been the greatest product placement in China marketing history:

Coca-Cola's particular genius is not just to localize its brand, but to work it into a strong local cultural event. Though little hardcore evidence is available to confirm just how many Chinese families have adopted the "First Coke of the Year" as a Spring Festival tradition, it's the right direction for brands in China to be thinking.

We've noted before that a brand's success in China increasingly depends on localizing without losing its "Westerness." KFC has done exceedingly well by localizing its food offerings to the local market, adding egg tarts, bamboo shoots and tofu on its menu.

What could throw a wrench in the great branding works for Coca-Cola, however, is a recent high-profile accusation of over-Westernization of Chinese culture by none other than Chinese President Hu Jintao himself. Hu warned that foreigners were trying to influence China's "cultural fields" and that China needs to better project its own influence on the world.

Making good on that promise, China's leaders have cancelled TV shows deemed to be too Western (read: trashy, racy) in their manner of entertaining. How Coca-Cola China, which prides itself on entertaining the masses, navigates this new cultural purge and frostier reception to foreign ideas will be a 2012 case study worth watching.

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