China Consumer

Soda struggle

Coke’s latest challenger is…


Genki Forest’s new cola drink

Richard Branson tried to topple Coke with his launch of Virgin Cola in 1994. “But Coca-Cola had a lot more firepower than us,” the British businessman later admitted. “They poured all of their huge resources into squashing us, and soon Virgin Cola was gone from the shelves.”

“If you are taking on a business far larger than yours, you have to be so much better than them.”

So can China produce a domestic cola to challenge the international giants? That’s the question many are asking after the wildly-popular beverage maker Genki Forest announced that it was planning to launch a cola-flavoured soda to rival the likes of Coke Zero and Diet Pepsi.

Little is known about the imminent release other than that the cola will be low-sugar and zero-fat, like Genki’s other beverages (which range from sparkling fruit-flavoured waters to instant teas).

The new concoction will also use erythritol as a sweetener instead of aspartame – the cheaper sugar alternative favoured by Coca-Cola in its diet drinks.

The move into colas is a bold one given Coke and Pepsi’s hold over the market. Genki – also known as Yuanqi Forest – was founded in 2016 and quickly picked up a huge following with its slickly-branded, health-conscious beverages. Between 2020 and 2021 sales increased 270% and the company is now said to be valued somewhere close to $15 billion.

Yet while its fans are loyal and its brand is much admired, many doubt Genki’s ability to deliver a successful Chinese cola, not least because there have been at least half a dozen efforts to do the same.

The first – and probably most successful – was Laoshan Cola, launched by the Qingdao Beverages Company in 1953. On top of the basic cola profile, Laoshan mixed in a dash of ginger and cloves. But Coca-Cola bought the company in the mid-1990s and discontinued the drink a few years later.

Another challenger was Chongqing’s Tianfu Cola that was bought by Pepsi but saw its growth stall. It eventually reopened under new ownership and now sells as a local speciality drink.

Then in 1988, drinks maker Wahaha launched its own Feichang or Future Cola – which is still stocked in rural areas and smaller cities.

Several additional brands failed to make the commercial breakthrough including Phoenix, Happy and Asia colas.

Images of the new bottles (see photo above) suggest Genki’s new product is being described as ‘cola flavoured soda’.

Reportedly, some company insiders were reluctant to launch cola but the founder Tang Binsen insisted on it as part of his wider plan to grow the drinks company into a bigger challenger to more established rivals like Atlanta-based Coca-Cola. Tang’s background is in tech and much of Genki’s popularity is derived from its efforts to position itself as a young, modern, aspirational brand. Expect the arrival of Genki Cola to be accompanied by a huge campaign on social media.

© ChinTell Ltd. All rights reserved.

Sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.