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Coke Taps Berlin for Mid-Calorie Cola

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NEW YORK A new chapter is being written in the cola wars as Coca-Cola Co. and PepsiCo get set to launch mid-calorie drinks this summer.

One of the authors will be WPP Group's Berlin Cameron/Red Cell, New York, which sources said has won a pitch to handle the debut of Coke Ultra, the working name for the product, which is still in the testing phase.

Pepsi last week said it would launch its mid-calorie cola, Pepsi Edge, in the summer, and that advertising will be created by its longtime shop, Omnicom Group's BBDO, New York.

Sources said Berlin Cameron won the Coke Ultra pitch over Interpublic Group's The Martin Agency in Richmond, Va. Executives at Martin and Berlin Cameron could not be reached for comment. One source said Coke, based in Atlanta, asked IPG to put forth an agency for the pitch and that the holding company chose Martin "because it did a great job launching Vanilla [Coke]."

Regarding ad support for Coke Ultra, the source said, "It's going to be big money."

To support the Vanilla Coke launch in 2002, Coca-Cola spent $25 million on measured media for the brand from June through December of that year, according to Nielsen Monitor-Plus.

Sources estimated that the company will spend up to $50 million on Coke Ultra's introduction.

The competing brands will battle to establish a new beachhead in the soft-drink market, in which cola consumption has been declining and consumers are experimenting with low-carb diets. Coke Ultra could have as few as half the 150 calories in Coke Classic.

A Coke rep declined to comment on whether agencies pitched for a new product assignment or on whether any product named Coke Ultra was in the works.

"Innovation is at the heart of everything we're doing at the Coca-Cola Co.," said Coke rep Mart Martin. "And we're always looking for ways to expand the franchise. We're developing and testing a broad range of products. That's our job."

John Sicher, editor and publisher of Beverage Digest in Bedford Hills, N.Y., said the new category is important to the soft-drink giants because it will provide "a substantial calorie and carb reduction with little or no taste sacrifice. Diet Coke and Diet Pepsi are growing strongly. Coke Classic and Pepsi are declining. These companies need a product that will in effect offset the decline of the regular colas. These could be the key to doing that."

According to Beverage Digest, Diet Coke volume grew 5 percent in 2003, while Diet Pepsi rose about 6 percent.

Cadbury Schweppes is considering a mid-calorie version of its Dr Pepper brand, according to analysts.

Pepsi, based in Purchase, N.Y., last week said the media spend on Pepsi Edge will be on par with its past national product launches. The company spent $30 million introducing the failed Pepsi Blue two years ago. In 1995, it stopped producing the 70-calorie Pepsi XL after a failed summer test run.

Berlin Cameron won lead creative duties on Coke Classic in February 2003. It also handles Dasani and Minute Maid drinks.