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- Cola Wars Continue: Coke and Pepsi in the Twenty-First Century
- 9 -7 1 1 -462 Cola Wars Continue: Coke and Pepsi in 2010
- Cola Wars Continue Coke and Pepsi in 2006 by Group C
Analyzes the industry structure and competitive strategy of Coca-Cola and Pepsi over years of rivalry. New Challenges in include improving labeling carbonated soft drink CSD sales and finding new sources of income. Both companies have also begun to modify their bottling, pricing, and brand strategy.
Cola Wars Continue: Coke and Pepsi in the Twenty-First Century
Copy embed code:. Automatically changes to Flash or non-Flash embed. WordPress Embed Customize Embed. URL: Copy. Presentation Description No description available. Cola Wars Continue Prof. Brand identity over a long period. What did they cost? In many cases, soft drinks are an impulse buy. Lifestyle choices: Coke and Pepsi have made their drinks represent a choice about how you live, not just how you quench your thirst. Who are they? What really goes into regular concentrate for Coca-Cola?
Who has won the cola wars? Who has lost? The terms are clear and well defined; both have carefully avoided downward spiral seen in other competitive contexts. Both Coke and Pepsi!
Rising tide has lifted both boats! What was the logic of the franchise system? Why did Coke and Pepsi use exclusive vs. Mitra, FMS, Delhi Buyers: Fountain: Buyers: 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.
Data in Exhibit 6 combine vending--the most profitable channel-- with fountain, the least profitable. Machines are in hard-to-reach places, allowing for high retail prices. Not necessarily as price-sensitive as they are in other product categories Coke and Pepsi try to minimize supermarket power by offering more efficiency—i. For CP producer, every sale no matter how much it costs to deliver is a profitable sale; for bottlers, the key is to find profitable sales i.
If bottlers had non-exclusive territories, the tendency would be to expand geographically and go after the easy sales vending, warehouses, etc. But the CP wants exclusive franchises to force the bottler to saturate their territory : A bottler can only grow in this system if it increases saturation. What are the likely challenges to the stability of the industry structure in the coming decade?
What are the potential drivers of structural change? Do CPs risk becoming a less profitable business if they do not extend the brand? No good answers yet to these questions: Pepsi, so far, has had more success and has been more aggressive with non-CSDs. There are exceptions—e. As niche products, non-CSDs carried prices and margins that are higher for everyone in the value chain. Mitra, FMS, Delhi Bottled Water: Bottled Water Unless Coke and Pepsi can generate brand loyalty and establish their brands, water is more likely to become a commodity-like product, where despite the scale and barriers in distribution, most of the profits will be extracted by the distribution channel retailers rather than by the concentrate companies or especially the bottlers.
One of the clearest examples on how firms can create and exercise market power. To really understand the opportunities for strategy, we have to look at the underlying economics of the firm and the industry, and its related upstream and downstream parts.
Without understanding the economics of the CP and bottler, we cannot understand the motivations and the likely success of moves like vertical integration. Coke and Pepsi did not just inherit this business; they created it.
Part of their on-going success will be a function of their ability to structure not only their businesses, but the industry as a whole In other words, industry structure is not always exogenous, it can be endogenous.
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URL :. Related Presentations :. Add to Channel. The presentation is successfully added In Your Favorites. Views: Category: Education. Like it 0. Dislike it 0. Added: July 20, Posting comment Premium member. Presentation Transcript. Mitra, FMS, Delhi. Opening Questions: Opening Questions In such a profitable industry see Exhibit 4 , why have so few firms successfully entered this business over the last century?
Slide 4: What are the barriers to entry? Substitutes: Substitutes Not always conveniently available. Buyers: Bottlers: Buyers: Bottlers Bottlers have had very little power in the last 25 years, even when they were independent. Who has been winning the war? Pepsi Strategy: Pepsi Strategy Selective discounts in distribution outlets Targeted growing take-home market i. Who wins since Pepsi Challenge? Who has been losing? Summary, so far: 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!
Buyers: Fountain: Buyers: 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. Buyers: Vending: Buyers: Vending Highly profitable for the bottler—why? Buyers: Supermarkets: Buyers: Supermarkets For the supermarket, it is a high turn product—it draws in customer traffic.
Suppliers: Suppliers Do they have power? Rivalry: Rivalry Other brands share the rivalry problems with Coke and Pepsi But … Geographic exclusivity limits the competition among bottlers. Summary, so far: Summary, so far Bottling is clearly much less profitable; most bottlers lost money in the s. Transition: Transition Coke and Pepsi have created a very profitable industry that has lasted more than a century. Non-CSD beverage: Non-CSD beverage The basic principles of the business remain the same: Coke and Pepsi own the brand and control product development; Dedicated bottlers leverage economies of scope in distribution selling to same outlet, same trucks.
Bottled Water: Bottled Water Repeat of CSD New less attractive Industry Structure Economies of scale in advertising Hard to create brand loyalty Barriers to entry in distribution Highly fragmented, competitive structure Similar economics of concentrate firm High price sensitivity Little differentiation e. Bottled Water: Bottled Water Unless Coke and Pepsi can generate brand loyalty and establish their brands, water is more likely to become a commodity-like product, where despite the scale and barriers in distribution, most of the profits will be extracted by the distribution channel retailers rather than by the concentrate companies or especially the bottlers.
Summary of the Case: Summary of the Case 1. Summary: Summary 3. You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation. Careers Webinars. All rights reserved. Use HTTPs.
9 -7 1 1 -462 Cola Wars Continue: Coke and Pepsi in 2010
Relationship with the bottlers has been critical to Pepsis success over Coke Coke raised its concentrate prices leaving the bottlers a narrower proBit margin in the highly price sensitive industry. Threat Of New Entrants Low Bottling Network- Have franchisee agreements with their existing bottlers who have rights in a certain geographic area in perpetuity Access to distribution is limited High brand loyalty Advertising Spend-huge advertising and marketing spend required. Majority of the U. CSDs were packed in metal cans - Coke and Pepsi were among the largest customers for metal can industry - Cans are commodity, manufacturers. Huge advertising, brand equity, and making easy availability of product reduced the threat of substitutes.
Below are the available bulk discount rates for each individual item when you purchase a certain amount. Register as a Premium Educator at hbsp. Publication Date: May 09, Source: Harvard Business School. Examines the industry structure and competitive strategy of Coca-Cola and Pepsi over years of rivalry.
Case Flash Forward: Cola Wars Continue: PepsiCo. Product: PDF-ENG. Examines the industry structure and competitive strategy of Coca-Cola.
Cola Wars Continue Coke and Pepsi in 2006 by Group C
By: David B. Yoffie and Yusi Wang. Abstract Examines the industry structure and competitive strategy of Coca-cola and Pepsi over years of rivalry. New challenges of the 21st century included boosting flagging domestic cola sales and finding new revenue streams. Both firms also began to modify their bottling, pricing, and brand strategies.
Examines the industry structure and competitive strategy of Coca-Cola and Pepsi over years of rivalry. New challenges in include boosting flagging carbonated soft drink CSD sales and finding new revenue streams. Both firms also began to modify their bottling, pricing, and brand strategies.
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- Когда мистер Беккер найдет ключ, он будет вознагражден сполна. ГЛАВА 22 Дэвид Беккер быстро подошел к койке и посмотрел на спящего старика. Правое запястье в гипсе.