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Coca cola vs pepsi strategy
Coca cola vs pepsi strategy
Strategy from coca cola versus pepsi
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Pepsico in Mexico Business Analysis
This case describes the complexity of PepsiCo's competitive position in the Mexican soft-drink market during the late 1990's. Between 1993 and 1996 PepsiCo and Coca-Cola waged a classic cola war in Latin America. The goal for both companies was to gain market share and by the end of 1996, Coca-Cola had clearly won the Latin America cola war. In 1993 PepsiCo enjoyed a 42% market share in Venezuela thanks to the success of its bottling partner, the Cisneros Group but by the end of 1996, PepsiCo held less than 1% of the Venezuelan cola market. Following PepsiCo's anchor bottler in Mexico, Gemex, the case details the strategies employed by PepsiCo's senior management beginning in 1993 to expand its market share versus Coca-Cola. The various dimensions of PepsiCo's strategy -- marketing, management, financial, strategic - seemed to have deteriorated in the aftermath of the unexpected fall in the Mexican peso in December 1994. Focusing on the financial implications of the peso devaluation, the case then describes PepsiCo's response, which only seemed to increase the financial burdens imposed on the faltering Pepsi market share.
Critical Analysis of the Issues
In 1993 PepsiCo was the second largest soft-drink company, after the leader Coca-Cola. That was the year when the "Latin Cola War" broke out. Both companies felt the Latin American market was under developed and saw many opportunities to succeed. In the beginning it seemed PepsiCo would be the winner of the competition, but after the depression in Mexico, and lack of capital problems in other countries, PepsiCo's market share fall. They lost their Venezuelan partner and their partner in Mexico was experiencing significant losses.
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...t of sales. Also, an implementation of corporate owned/controlled bottling facilities that would act as recruiting agents for other regional and local bottlers is critical to PepsiCo's success in this market.
Based on my recommended solutions above and some well thought out strategies by PepsiCo management, they would see its market share return. Once these strategies are implemented and successful, PepsiCo should then concentrate on gaining share in the Latin American market from share leader Coca-Cola.
References
"Coke v Pepsi", January 29, 1994, The Economist, pp. 67-68.
DeNitto, Emily. (1994) "Pepsi, Coke think international for future growth", Advertising Age, p. 44.
Moffett, M., & Soto, T. (1996). PepsiCo in Mexico: Anatomy of an Affiliate's Exposure (Case Study A06-97-0003). Thunderbird. The American Graduate School of International Management.
Pepsi needed a strong regional partner. Pepsi had been falling behind to Coke in Mexican market. However, changes in the regulatory environment had cut Coke’...
Therefore, the long-term brand of Coca cola and better pricing strategies would help in competing with Pepsi. Unlike, Pepsi, Coca cola had targeted entering into partnership and alliances with local distributors and firms. This helps to develop strong relationship within the domestic firms to reduce the domestic barriers and thus, enhance the company’s competitiveness (Thabet, 2015). Lastly, the Asian markets consist of related and supporting industries to the soft drink industry that helps the companies in gaining a strong competitive position in the markets. Based on the competitive advantage of nation’s model, Coca cola has more home based advantages to develop a competitive advantage in relation to other countries on a global
CASE 1-3: Coke and Pepsi Learn To Compete in India The political environment in India proved critical in that their government was unfavorable to foreign investors. They prohibited the import of soft drinks since they felt it could be gotten anywhere. They also prohibited the foreign brand name and wanted the name Lehar Pepsi and Coca-Cola India, an indigenous name. These effects couldn’t have be anticipated prior to entering the market because the trade policies, rules and regulations of India were difficult and unpredictable.
Control of market share is the key issue in this case study. The situation is both Coke and Pepsi are trying to gain market share in this beverage market, which is valued at over $30 billion a year. Just how is this done in such a competitive market is the underlying issue. The facts are that each company is coming up with new products and ideas in order to increase their market share.
Through combining beverage, fast-food, and snack-food businesses into one conglomerate, PepsiCo has implemented a strategy that encompasses an excellent opportunity for matching up the different segments value chains, enticing skill transfers, and incurring cost sharing. A great example of a value chain match up that resulted in cost sharing would be the when PepsiCo combined its original carbonated beverage business with other beverage business such as the various juice and tea brands it acquired. These two business share many similarities between value chain activities and were very easy to incorporate into the existing beverage business. Our team also sees a great opportunity for Pepsi to cross-brand market its Frito-Lay products with its beverage product lines, particularly its carbonated beverage segment.
Why after all did Pepsi enter again, facing a country with such strongly adverse feelings towards foreign companies – which is rooted in Indians history of colonialistic times when the British, French and Portuguese were extracting the country‘s recources ‚‘its wealth‘ without returning noticeable benefits to its economy.
Pepsi Cola Marketing Strategy PEPSI COLA For Pepsi Cola Ltd, marketing opportunity analysis is a continual and ongoing process. Pepsi have used the new product strategy to realise their ambitions to both defend their current market position, and reinstate their position as a product innovator. Pepsi wishes to create a clear cola that is 100% natural, low in sodium, caffeine-free, and still maintains the flavour of its original cola. They will call it Pepsi Au Naturel.
Bottling Network: Both Coke and PepsiCo have franchisee agreements with their existing bottler’s who have rights in a certain geographic area in perpetuity. These agreements prohibit bottler’s from taking on new competing brands for similar products. Also with the recent consolidation among the bottler’s and the backward integration with both Coke and Pepsi buying significant percent of bottling companies, it is very difficult for a firm entering to find bottler’s willing to distribute their product.
From the analysis, the return on sales has increased over the recent three years. This indicates that the firm demand of the firm’s products has a positive trend. This is contrary to the return on sales for Coca-Cola which is relatively constant. Thus, the PepsiCo sales are on a positive trend.
Pepsi Company – An Overview OVERIVEW PepsiCo is a world leader in convenient foods and beverages, with revenues of about $25 billion and over 142,000 employees. The company consists of the snack businesses of Frito-Lay North America and Frito-Lay International; the beverage businesses of Pepsi-Cola North America, Gatorade/Tropicana North America and PepsiCo Beverages International; and Quaker Foods North America, manufacturer and marketer of ready-to-eat cereals and other food products. PepsiCo brands are available in nearly 200 countries and territories. Many of PepsiCo's brand names are over 100-years-old, but the corporation is relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay.
Started in 1916, PepsiCo, Inc. has grown substantially over the past 98 years. PepsiCo started with a formula for a carbonated beverage and has expanded its product line to include snacks products, other non-carbonated beverages, and food products. Pepsi is one of the most globally recognized brands and its other products lines are just as popular as the beverage. PepsiCo has been able to maximize their strengths and minimize their weaknesses from within the company in their research and development and marketing divisions. Using financial ratios, an in-depth look into the financial accounting of PepsiCo will determine if the company is as successful as it seems.
Key success factors in the industry are a strong brand presence, maintaining customer loyalty as exploring new markets and distribution channels as well as offering a diversified product line. Implications of these factors are strong competition and dependency of company’s behavior and marketing strategies on competitors’ behavior. This is especially true for Coca-Cola and PepsiCo since their flagship products are very much alike in look and taste.
Frito-Lay controlled 40% of the USA-market assuring high volume production by increasing internal coordination with PepsiCo developing the Power of One strategy consisting in mixing snacks with beverages and sauces produced by Peps...
The purpose of this report is to compare financial reports from the two largest soft drink manufacturers in the world. The Pepsi Co. and Coca Cola have been the industry's leaders in their market since the early 1900's. I will use relevant figures to determine profitability, and break down key ratios in profitability, liquidity, and solvency. By breaking down financial statements, and converting them to percentages and ratios, comparisons can be made between competitors regardless of size.
...e and Pepsi’s already established image as producers of premium product is key to discouraging other companies from entering the soft drink industry. However, as the market in the U.S has leveled off, they should continue to invest globally in marketing and advertising for further profit growth, which will in turn positively influence their well established brands to further increase soft drink sales and profits.