Case Study Coke And Pepsi

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About the Paper
Authors: David B. Yoffie and Reene Kim
Title: Cola Wars Continue: Coke and Pepsi in 2010
Journal name: Harvard Business Review
Volume & Issue: 9-711-462
Year: May 2011

Introduction This case study observes the industry structure and competitive strategy of Coca-cola and Pepsi over 100 years of rivalry. It gives insight about how these two company was literally into an extreme fights in the so-called “cola war”. Firsthand challenges of the 21st century included improving weakening internal cola sales and finding new income streams. Coke as well as Pepsi started to change their bottling, pricing, and brand strategies. They viewed the developing global markets to enhance growth and expand their brand sets to include noncarbonated
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In the late 1950s, the beginning of World War II, both companies started to make it clear in their advertising that competition existed between them, creating campaigns that accepted the presence of competitors. In this case let, the authors explained the status of industry background, economic background, Porter’ five force analysis and few issues on forces altering the company’s strategy of operation during the period.
The economic standing of U.S CSD industry started deteriorating from 1975 through the mid-1990’s. The consumer started becoming health conscious especially started dodging carbonated drinks, so market for CSD started falling drastically. Both the companies average annual profit growth decreased year after year as there were many alternative beverages other than CSD.

Production and Distribution The companies started hanging their production and distribution strategy by introducing four distinct participants as mentioned
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It is not so clear whether the cola wars really took place and that both businesses profited from that. The outfits used in this war were reaching from marketing drives to the improvement of the delivery services and the upgrading of plants, introducing new flavors and packing.

The effects of this war were on the industry's profitability. The rivalry for supermarket shelf space led to a decrease in retail prices and as a result of intense competition, bottlers saw an increase in capital requirements followed by a decrease in margins. Sustaining profits in a market which is giving more and more importance to the non-carbonated drinks can be difficult task to achieve, but there are some measures that could help both companies in reaching it: diversification, marketing, focus on core products, emerging markets, innovation, market research

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