Coke vs. Pepsi

1653 Words4 Pages

Coke vs. Pepsi The company known as Coca-Cola today was started in September of 1919, but the first Coke brand was served as early as 1886. Since that time it has grown to be one of the most globally recognized brand names with a stock value of $167 billion. Coke’s plan has always been developed with the future in mind. Right away the company realized that it was more profitable to manufacture the concentrate used to make carbonated drinks than to bottle it. From that point on they saw the entire world, not simply the originating country, as their desired market. It seems only practical that the company should pursue this agenda until conquered then focus the effort on expanding into different product lines. This logical idea has catapulted them into the much sought after position of number one. Manufacturing the concentrate requires only a limited capital and a minimal reinvestment, but yields huge profits. The company focuses their efforts on capturing more buyers for the most profitable product while distancing itself from the less profitable operations. In order to do this; Coke must have a loyal relationship with its bottlers in order to insure the completion and delivery of its product. They have found that maintaining a close association, as well as partial ownership in the less profitable business encourages both businesses to work together because they depend on one another. More importantly, it gives Coke the cash needed to chase after customers because they operate only in the highly profiting part of operations. Pepsi operates its beverage business quite differently than Coke. Coke sells concentrate to independent bottlers while Pepsi owns its bottling and concentrate operations. This makes Peps... ... middle of paper ... ...spin-off from its restaurants, in addition to the probable spin-off from bottlers and expansion of high profit concentrate and snack food systems into overseas markets, PepsiCo will soon be able to operate like Coca-Cola. In the meantime, Coca-Cola has a superior strategic plan that produces profits that produce plenty of money to expand, buy back stock, and meet financial obligations. Bibliography: Works Cited Knestout, Brian. “The Mighty Coke is Getting Beaten Up.” Kiplinger’s Personal Financial Magazine. Dec. 1998. Sellers, Patrica. “Is Bigger Better.” Fortune. 28 Oct. 1996. Sellers, Patrica and Erin Davies. “Why Pepsi Needs to be More Like Coke.” Fortune. 3 March 1997. Steinriede, Kent. “Fountain War Heats Up” Beverage Industry. Oct 1998. “Letter from the Chairman of PepsiCo. Inc.” 1998.

Show More
Related

  • Persuasive Essay On Coke Vs Pepsi

    824 Words  | 2 Pages

    Coke continuously out-stands Pepsi, even though they share a very similar taste and colour, however Coke should not be the drink that receives all the love and attention for what it offers. Despite their similar soda colour, the drinks actually contain some different ingredients, which produce a different taste, and affect the body differently. Furthermore, the way the companies markets their drinks makes a huge contribution to how successful their products will become. The major element for success however stems from their impact on society and how the companies utilize their social power to evolve. The two major soda companies are constantly head to head with one another, yet it is what they do that sets them apart.

    Read More

  • Soft Drink Industry Porter's Five Forces Analysis:

    1671 Words  | 4 Pages

    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.

    Read More

  • Coca Cola Vs Pepsi Case Study

    744 Words  | 2 Pages

    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

    Read More

  • Pepsi and Coke in the Czech Republic

    1972 Words  | 4 Pages

    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.

    Read More

  • Bottled Water Industry: Competition, Trends, and Strategies

    1933 Words  | 4 Pages

    ... objects and customer regions. Do making a clear differentiation image between its soft drinks and bottled water. Because the consumers may believe that bottled water of Nestle sounds healthier than Coca-Cola brand since Nestle tend to emphasize their image on healthy food products. Then do market test for new taste, new packaging, or new innovation according to each regions, and especially for Europe, the company should launch the new one to replace Dasani image in order to seize their market shares. They may renew all nutrients and packaging. Finally Coca-Cola should continue its joint ventures with the regional companies in order to protect their products from barriers to entry both international trade restrictions and distribution channels. Furthermore, joint venture with local brand is a long term contract guarantee to make it easier for HOD to a specific region.

    Read More

  • Comparing the Profitability of Pepsi and Coca Cola Companies

    1829 Words  | 4 Pages

    The purpose of this report is to compare financial reports from the two largest soft drink manufacturers in the world. Pepsi Co. and Coca Cola have been the industry 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. First, let's take a look at Pepsi Co. to determine profitability, there are several ratios utilized.

    Read More

  • Financial Analysis of Pepsi Co and The Coca Cola Company

    861 Words  | 2 Pages

    If Coca Cola continues to follow the same pattern, I see them being very profitable in the future because from 2004 to 2005 the company has really made some changes in the right direction. If Pepsi Co decreases the expenses that I recommended, I can see them becoming more profitable than Coca Cola.

    Read More

  • Marketing Case Study: SWOT Analysis Of Coca-Cola

    882 Words  | 2 Pages

    Coca-Cola’s goal was to propel Coke to be the number one beverage in the market. In addition, the company looked towards diversifying their portfolio of offerings by introducing other lines of soft drinks. As competitors such as Pepsi infiltrated the market, Coca- Cola lost sight of their company’s objectives. Executives became immersed in other issues such as government allegations, syrup prices, ownership of company franchises and ignored the principle issues such as the marketing and sale of their product.

    Read More

  • Business Analysis: Pepsico And Apple

    717 Words  | 2 Pages

    As we all should know, PepsiCo is one of the world’s leader in convenient food and beverages. PepsiCo shares are traded worldwide and particularly in NYSE (United States). PepsiCo is in the same line with Coca cola and Cadbury Schweppes as the dominating beverage companies. PepsiCo has successfully built a great brand name rivaling with coca cola, probably because PepsiCo unlike coca cola has its own bottling companies. With a competitive strategy based on differentiation rather than cost leadership like its fellow competitors PepsiCo invests highly in new packaging, flavors, formulas to outsmart their competition. Founded in 1919, producing a variety of sweet and grain-based snacks, carbonated and non-carbonated

    Read More

  • Global History Of Coca Cola

    863 Words  | 2 Pages

    Coca-Cola began in 1886, advertised a drink that relieves exhaustion for 5 cents a bottle; 130 years later Coca-Cola is now a billion dollar corporation that sells 1.9 billion bottles a day. The bright red logo can be recognized on billboards, commercials, magazines, and any type of merchandise imaginable. “The Pause that Refreshes”, “I Want to Buy The World a Coke”, and “Open Happiness” are Coke slogans that are still repeated in the market today. Its unique flavor and stylized bottle have set it apart from competition, making it easily recognizable in all fashions.(Worldofcoca-cola.com, Coca-Cola History, 2016)Coca-Cola is considered a worldwide phenomenon. The name Coca-Cola holds a long history and many changes that got it where it is today.

    Read More

  • Research Paper On Pepsi

    2038 Words  | 5 Pages

    Competitive pricing is a factor, which the firm should keep in mind all the time. The scenario is very important because there can be civil disturbance, fall in sales due to inflation, or cross-border situations. As a result, Pepsi has to stay updated with all changes and policies in order to adapt.

    Read More

  • Coca Cola Competitive Advantage Essay

    910 Words  | 2 Pages

    Coca-Cola is a company with sustainable competitive advantage. The company is innovative and has an extensive business model with boasts of a sustainable distribution network. The company was incorporated in the late 1800s to commence the production of a sweet fizzy beverage that has become the world's most known brand. Presently, the company is still on an upward trajectory as it remains one of the world's most sought-after stocks. The company's competitive advantage has shown resilience and sustainability over the years.

    Read More

  • Comparison Of Coca-Cola Vs Pepsi

    1007 Words  | 3 Pages

    Their advertising techniques set them apart as Coca-Cola still seems to market themselves as a “classic” company, and Pepsi seems to be more interested in modern methods market themselves. I am not discrediting anything that is classic, but as the world continues to grow and innovate we must move with it, if we continue to live in the past we will be left behind. Coca-Cola’s included image of Marilyn Monroe, a “classic” icon, and Pepsi’s included image of Beyoncé Knowles, a “modern” icon proves this point, which is why would Pepsi’s advertisement is more effective at attracting

    Read More

  • Trends Of Coca Cola

    857 Words  | 2 Pages

    This is a great model for the company because they can keep their logistic costs down by helping other companies expand their distribution networks. Experimentation with the new market for carbonated beverages on the decline, Coke has done experiments in new flavors and healthier alternatives to try to stay competitive. As well as investing in “Keurig Green Mountain is a K-Cup maker but has a new Keurig Cold that can deliver Coca-Cola through the new system.” (Cooper, 2014) Learning from experience, Coca-Cola has had some fierce competition over the years but nothing in the form of an entire health market shift like now.

    Read More

  • Compare And Contrast Coke And Pepsi

    946 Words  | 2 Pages

    Coke and Pepsi have been raging war for over a century now, turning their sodas into a multi-billion-dollar industry. Coke has been able to drive more earnings for its bottom line, and while Coke’s net income has been trending downward in recent years, it manages to stay ahead thanks to superior margins. Pepsi, on the other hand, has produced consistent net profit margins of around 10%, while Coke margins have been in the 15-18% range for the past several years (O’Brien). Every company has a Market Cap, which is basically a fancy way of saying how much the company is worth, and Coca-Cola’s market cap is a whopping $180 billion. Pepsi’s Market Cap is $150 billion, which may not seem like a big difference, but $30 billion is a lot of cheddar. Therefore, Coca-Cola owns 51% of the soft drink market, whereas Pepsi only owns 22% of it. Coke claims to own a total of 35 different brands, including Fanta, Sprite, Powerade, Vitaminwater, and many others. Pepsi owns 22 different brands, including 7up, Gatorade, and Mountain Dew “Coke (Coca-Cola) vs Pepsi - Soda

    Read More

More about Coke vs. Pepsi

Open Document