Connie Roudier Case Study Analysis:
Cola Wars Continue Prof. July 20, Major Themes: Major Themes Underlying economics of an industry: Relationship to profits Different stages of the value chain in an industry: Opening Questions In such a profitable industry see Exhibit 4why have so few firms successfully entered this business over the last century?
What are the barriers to entry? Cumulative spend on Ad. Brand identity over a long period. Much more costly than moving into open channels. What did they cost? Substitutes Not always conveniently available. In many cases, soft drinks are an impulse buy.
Coke and Pepsi have made their drinks represent a choice about how you live, not just how you quench your thirst. Half the consumption of Coke is reportedly consumed by people that drink an average of 8 cans per day! What really goes into regular concentrate for Coca-Cola? Bottlers Bottlers have had very little power in the last 25 years, even when they were independent.
Historically, Coke had bottlers. Customers number in the billions! Who has won the cola wars? The terms are clear and well defined; both have carefully avoided downward spiral seen in other competitive contexts. Prices on concentrate have not been affected since the early s Exhibit 5.
Competition is focused largely on: Who has been winning the war? Pepsi Strategy Selective discounts in distribution outlets Targeted growing take-home market i. Who wins since Pepsi Challenge? Both Coke and Pepsi!
Rising tide has lifted both boats! Who has been losing? Summary, so far Constrained competition High BTE Locked-in buyers Secret ingredients low cost, hard to imitate Lots of substitutes, but advertising and widespread distribution limit their impact In sum, a great business!
What was the logic of the franchise system? Why did Coke and Pepsi use exclusive vs.
Fountain Large fountain accounts, such as McDonalds, have significant power: Fountains usually carry only one brand, so they can easily play dominant players off against each other Coke and Pepsi are strongly motivated to get fountain accounts, in order to build brand awareness.
Vending Highly profitable for the bottler—why? Data in Exhibit 6 combine vending--the most profitable channel-- with fountain, the least profitable.Case Study Analysis: Cola Wars Continue: Coke and Pepsi in _____ Connie Roudier Pepperdine University OTMT Managing Organizations Fall Introduction Coca-Cola and Pepsi dominated the carbonated soft drink (CSD) industry for over a century but are now experiencing significant and continuing drops in sales due to changes in their external environments.
COLA- WARS CONTINUE Case Solution Introduction. Coca-Cola Company and PepsiCo are two industry leaders in the carbonated soft drink industry. They are strong rivals of each other in the beverage market of the world.
Feb 12, · Jeff Dyer, Brigham Young University BUSM Lecture 1/15/ Hbr Case Study Cola leslutinsduphoenix.com Free Download Here Cola Wars - University at Albany, SUNY leslutinsduphoenix.com Cola wars continue - Coke and Pepsi 1. VS Cola Wars Continue: Coke andPepsi in Marketing Strategy – Jim Prost Pamela Belluomini, Hristina Bencheva, Julia Kocs, Brianna Randall and Angela Teodoro.
Cola Wars Continue (Prof. David Yofffie, HBS) Case Discussion: July 20, Major Themes: Major Themes Underlying economics of an industry: Relationship to profits Different stages of the value chain in an industry: Incentives for vertical integration How globalization can impact industry structure 7/20/ 2 Session led by Prof.