Coca-Cola Will Launch Its First Alcoholic Drink To Compete In Japan

Coca-Cola will introduce the first alcoholic drink in the company's 125-year history, tapping into a growing trend in Japan for mildly intoxicating drink mixes.

But if you were thinking rum and Coke, you would be wrong.

Instead, the new brand will compete in a category known as Chu-Hi, a canned drink, the main ingredient of which is a vodka-like distillation of rice, barley and potatoes known as shōchū. Chu-Hi also typically includes sparkling water and flavoring.

"We haven't experimented in the low alcohol category before, but it's an example of how we continue to explore opportunities outside our core areas," Jorge Garduño, president of Coca-Cola's Japan business unit, said recently on its website.

Garduño said the move into alcoholic drinks "is unique in our history," adding that entering the Chu-Hi market "is a modest experiment for a specific slice of our market."

"It makes sense to give this a try in our market," he said. "But I don't think people around the world should expect to see this kind of thing from Coca-Cola."

The Chu-Hi market reportedly has hundreds of flavors and varieties, such as Strong Zero, Highball Lemon and Slat, and according to the Japanese producer, Suntory has seen growth between 5 percent and 25 percent annually since 2013, The Financial Times reports.

The Times writes: "Chu-Hi canned drinks mostly range in alcohol content between 3 and 8 percent — a profile that has put them in direct competition with beer, and proved particularly attractive to female drinkers. The appeal of Chu-Hi has been enhanced by the relentless trial-and-error approach by major Japanese producers Kirin, Asahi, Takara and Suntory, which have released flavours that include yoghurt, acerola and wild basil."

Fortune adds:

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