Dairy giant Fonterra forms strategic alliance with Coca-Cola

One of the world’s largest dairy co-ops, New Zealand based Fonterra, and the world’s biggest soft drinks giant, Coca-Cola, have recently entered into a strategic alliance – which aims to capture opportunities in the growing dairy-beverages market in south-east Asia.

The new partnership’s aim is to combine Fonterra’s expertise in dairy nutrition, with Coca-Cola’s in-market sales and distribution capabilities, to launch a new range of dairy-based products, starting with Vietnam.

Products

The new products will include a range of kids’ and adults’ dairy-based ready-to-drink products under Coca-Cola’s Nutriboost brand.

Coca-Cola’s Nutriboost is already a well-known beverage brand in Vietnam, which offers customers a combination of milk and fruit juice in a ready-to-drink product, according to the companies.

Judith Swales, chief operating officer of Fonterra’s global consumer and food-service business, commented on the new alliance:

Both Fonterra and Coca-Cola are committed to disrupting and accelerating the growth of the dairy ready-to-drink category in south-east Asia.

“Dairy has become one of the fastest-growing beverage categories in south-east Asia.

“The demand is being driven by consumers’ increased focus on health and wellness and the category is expected to grow on average at more than 5% each year between 2016 and 2020,” Swales said.

This new alliance is in line with Coca-Cola’s long-term strategy to become “a total beverage company”, according to the firm.

Iain McLaughlin, president of Coca-Cola company’s Association of Southeast Asian Nations (ASEAN) business unit, added:

“We believe the value-added dairy beverage category offers a significant opportunity for growth in the region and the expanded Nutriboost range is the first step in our combined efforts, with Fonterra, to deliver winning new products for consumers.”

Opportunities

In the future, Coca-Cola and Fonterra plan to “explore further opportunities” to launch a range under Fonterra’s Anchor brand, along with new products in other markets – in countries such as Indonesia, Thailand and the Philippines.