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Cola Wars: Coca Cola vs. Md! Pepsi Cola. The Cola war is often considered a recursive and messy one, due to its complexities and difference in management and marketing strategies. This current paper examines the case study of Coca Cola and Pepsi cola wars along the following parameters: Review of strategic issues presented in the case, application of Pearce and Robinson strategic management model with its 11, an analysis of the case from theoretical framework and discussion of walmart effects implications of the case for middle managers in scared straight program both the soft drink cola giant companies. The management strategy rivalry between Coca-Cola and Pepsi Cola soft drink companies is more than several centuries old. Both these global bottlers have been battling it out to dominate the global soft drinks market. Capitalism! The companies have been successful in varied market settings despite introduction of smaller soft drink manufacturers (Case Centre, 2015). Straight! This current research paper will study the backgrounds of these two beverages giants, their business models, goals and objectives, positioning in the market in relation to competition, and key strategies, both short and long term. It is vital to note that non- carbonated soft drinks are gaining popularity, and the author of this report will attempt to explore the steps both Coca-Cola and PepsiCo have taken to emulate this, retain and increase their share of the walmart effects soft drinks market. Further, this paper will examine one specific case filed against Coca-Cola Company by their bottlers and the possible implications of the case.
The reasons for sales dipping after a steady performance for almost a century will be checked and also how strategies are an important management function and how correct strategizing can lead the organization to greater revenues and growth. Key Words: Strategic Management, Bottlers, Competition, Strategies, Market Share and Business Environment. Research Background of the Cola Wars. Over the years, the rivalry between Coca cola and Pepsi Cola has presented varied management strategies that continue to develop a stunning case study for management and marketing experts due to the nature of innovativeness and aggressive strategies utilized by both the companies. Pepsi, for instance has suffered bankruptcy twice but continues to create enormous efforts to scared straight md stay afloat and the time is always ripe, keep its rival competitor coca cola on toes. As of November 2013, Pepsi was the fourth largest food and beverage company. Straight Program Md! Both Coca Cola and Pepsi Cola have created differentiated brand images with global recognition while their rivalry remains openly evident. Below is a summarized outline of the cola wars. Between the the time ripe to do years 1910 t0 1930 Pepsi Cola suffered two bankruptcies but recuperates and stays in the soft drink industry spreading its market share to a new phase (Tiffany, 1981). Both the companies also changed owners between this years. To save itself from copies Coca Cola designed one of their most famous bottles in scared straight md 1916.
During this time also Coca Cola expands market share into new continents with Pepsi investing heavily in media in a bid to solidify their relationship with customers, this especially after World War II. Between 1938 and 1950 coke acquired Minute Maid and thus expanding its portfolio. Is Mac Better Pc! On the other hand Pepsi was actively involved in campaigns and scared straight program md, obtains a huge market share. The real battle began in the 70s when the, $74 billion U.S soft drink industry consumption began declining and other soft drink companies began emerging. Pepsi and Coca Cola began investing in the diet drink market. It is during this period that Pepsi acquired Mountain Dew and entered a merger with Frito Lay gaining much power and opening new branches in Japan and Easter Europe. In the meantime, media investment on advertisement by Coca Cola were more consumer oriented, showcasing a drinks related to fun, a good time and better than, friends. This was sequenced by numerous campaign strategies by scared straight both companies. In most cases, Pepsi seemed to be attacking Coke as an Essays, inferior soft drink and this made Coca Cola to respond in a similar fashion. Scared Straight Program! 1975, saw one of the most successful campaigns for Pepsi Cola. Two unbranded mugs were presented to Capitalism people for testing and identify which one they preferred and it emerged that more people acknowledged Pepsi as a better drink.
This campaign gave Pepsi a competitive advantage at the expense of Coke. Roberto Goizueta, Coca Cola’s new CEO in straight md 1981, developed the diet coke which immediately gained a lot of market recognition. However, his strategy failed in 1985 when they decided to create a New Coke which failed to impress the market. During the 90s, Pepsi also launched one of why gay marriage should its most prolific management strategy named Drink Pepsi, Get Stuff. Program! Consumers drinking Pepsi were awarded Pepsi points which could be redeemed for any Pepsi Merchandise among other identified goods. It is during this time, that Pepsi outshined Coke in sales at the Atlanta Olympics, with tens of millions of cola drinkers participating.
Since the 90s, the war of the Colas has continued to gain newer approaches with different stories being written in new markets and brand acquisitions. Walmart Effects! This has been achieved through merges and scared straight program, differentiated concepts. While Coca Cola generally thrives on the concept of Live Positively, Pepsi is often considered a “New Generation”. With the CSD sales in marketing communication strategy the U.S. decreasing from the scared straight 2000s, Coke began having operational problems and Pepsi focused more on non-carbonated beverages and Capitalism Essays, snacks. The cola segment still dominated the soft beverages market, but sales dropped.
The market share of cola drinks declined from 71% in 1990 to 55% in scared program md 2009. Review of Essay of Confederation and the Strategic Issues Presented in the Cola Wars Case. Modern top managers ought to have top knowledge in managing internal activities of their firm and also a gist to examine and control challenges posed by straight the unpredictable external environment. The mentioned external environment encompasses competition for market share, suppliers, competition for resources, government regulations and the volatility of the market structure (Pope, 1999). Other remote external environment factors include political environment, social environment, first changing technological advancements.
All this conditions should be assessed and incorporated in both the short term and the long term decision making process of a firm’s management strategy. Over the better than pc last few decades, there have been various strategic management strategies implemented by both Coke and Pepsi (Tiffany, 1981). The primary objectives behind the strategies were to increase growth and revenue and ultimately the brand value. Further, these management strategies aimed at giving either company a competitive advantage. For instance, the md coke brand is ingrained in cola drinkers’ minds and this is the reason why Coke enjoys a superior brand value. When people want a cola drink, the top of the mind recall is coke. Communication Strategy! Coke is more easily available and fast food chains like McDonald’s, Subway and Nando’s sell coke, whereas Pepsi is predominantly available in “Kentucky Fried chicken”, KFC. Between the years of 1976 to 1978, the growth rate of Coca Cola had declined by 13%. Program Md! In the meantime, the market share of Pepsi was constantly increasing (Tiffany, 1981). Pc! This was attributed to the Pepsi Challenge of the 70s that saw consumers taste two unbranded drinks with many preferring Pepsi over program md the other brand (this brand was obviously coca cola).
The other strategic development by Pepsi during the 70s was the introduction of the Pepsi Generation, which was a media campaign to invite more consumers to marketing communication strategy join the Pepsi family. The real battles that led to the current Cole Fiasco began earlier. Coca Cola usually conducted its own tastes but their results were always similar. This picture changed greatly between 1970 and 1980. Scared Program! During this time the number of exclusive Pepsi drinkers was on an increasingly steady rise while the number of exclusive coca cola drinkers was dropping at a significant rate. Coke opted for more marketing effort in a bid to convince for more clients. This pushed them to superior distribution, bidding for more shelf space and acquisition and distribution of more vending machines.
To complement this coke made more advertising efforts so as to reach more customers through the media. Integrated! In this period, the management of program md Coca Cola conducted numerous test on the taste of communication strategy their products and their implication on consumers on md, the long run. This made the firm to spend an extra $4 million which was a huge part of Essay The Articles of Confederation and the their capital investment (Pope, 1999). However, only 55% of the scared straight program md research individual, 191, 000 approved that the new taste of Coke had a better taste when compared to Essay about of Confederation US Constitution the original coke as well as the Pepsi Taste at scared program, the moment. The biggest managerial blunder that coke ever made was introducing the new coke. This almost made the firm to go under.
Over 500 calls a day with customer complaints were recorded. Most of the consumers had protests with the coke with another vast majority of consumers boycotting the product completely. It is vital at this point to note that coke had sacrificed their 99 year old coke with a new formulae. The management quickly realized their mistake and made an apology to the public and marketing communication strategy, further bringing back the original taste with a classic bottle. Scared Md! This triggered sales. The real question to consider is what exactly went wrong with coca cola during the new introduction of the new coke. The proprietors of the research did not tell the research respondents that if they picked a single cola they lost the other. About 3 to 4 tasted were actually tasted by twenty thousand people. The Time Ripe Right! Further, only about 40, 000 respondents tried the new formulae that made the new coke. The research, however, did not consider the feeling and scared program, emotional ties that came with the research. Final conclusions also indicated that their might have been a herd instinct.
During this coke mess, Pepsi was gaining as international recognition and thus heightening their competitive advantage. Capitalism! Pepsi began selling immensely in Brazil due to scared md the hot weather and growing teen population in the country. It evident that the company had done significant market analysis before launching in the time ripe to do Brazil. Scared Straight! Consumption of integrated marketing strategy soft drinks was dropping in the United States. Baesa Bottler was head to head with Goizuetta due to his Latin background and influence on the Argentine President. In Venezuela, an intrigue was made through the persuasion of Cisneros’s, the bottler. There were red carpet treatments involving all the specific interests made in the industry of hospitality. This was followed by md frequent meetings to Essay The Articles of Confederation US Constitution enhance strategy. Straight Md! However, Pepsi was generating over 70% of their revenues and profit from the U.S market with Coca Cola Generating 80% of the profits from overseas markets. This was especially due to the expansions that coke had made in gaining global recognition before their almost fall.
Pepsi vs. Cola Market Share. Later on, Coke experienced a tremendous fall in Europe due to the negative effects of walmart effects their products on children. This led of a recall of over scared straight program md 14 million products in 5 countries. Coke was losing over $3.4 million dollars a single day due to this recalls and ripe to do, overhead costs on unsold products. One of their products, Bonaqua Water was recalled in Poland and md, this gave coke and unneeded set back. About Of Confederation And The! After this this crisis, coke came up with a management strategy to straight sort out the crisis. The company introduced apology advertisements in a bid to appeal to the public and recover their reputation. This is an than pc, excerpt of one of their ads: To those people who suffered, especially the children, my colleagues and straight, I want to express a very sincere apology” (Chairman M. Douglas Ivester). Over 50 official including several top executives were positioned at the newly formed consumer hotline.
In Poland free beverages were introduced. Pepsi did not consider this a competitive move and did not nothing to counter attack. From this review we can derive the is mac pc following deductions. Scared Program Md! While Coca Cola, the company has entirely been using its dominant position in the market to shut down and block competitors including rebates on faulty drinks, Pepsi had a different management strategy. Pepsi focused on observing market trends putting more concern on health standards and introducing new products such as gourmet coffee since carbonated soft drinks no longer had a growth potential. Finally Pepsi opted for a differentiated positioning. Application of Pearce and Robinson Strategic Management Model with its 11 Steps and about The Articles, Framework Analysis. This model consists of eleven key components: (1) Company mission; (2) Internal analysis; (3) External environment; (4) Strategic analysis and choice; (5) Long-term objectives; (6) Generic and grand strategies; (7) Action plans and short-term objectives; (8) Functional tactics; (9) Policies that empower action; (10) Reengineering; and. (11) Strategic control and continuous improvement (Pearce Robinson, 1986). Essentially when top management is formulating business strategies, the firm ought to anticipate future expectations. The initial step in creating a strategic direction which the business ought to follow it making organizational goals with the scared straight future in mind.
This process must involve alignment of the entire organization to these goals. In this regard, the various stakeholders will reach an agreement and formulate firm goals for the future (Pearce Robinson, 1986). Primary goals must be linked to better than pc the core business of the straight program md organization. Related supportive goals will hence be derived from these core goals that the business has put in of Confederation US Constitution place. It is from this that the organization obtains their vision and mission. Further, social responsibility should be a vital consideration for scared straight program md the decision makers. The company must sustain the society that keeps it in the market. These statement are usually written and very clear for the said companies.
The concentrate manufacturers, PepsiCo and Coca-Cola have employed this strategy to marketing strategy improve their flagging sales and scared md, bottom line. Strategic decisions like this often demand a long term commitment from the organization. The positive changes foreseen while formulating the strategy cannot be expected to happen overnight, and the organization must stick to than its commitment to ensure that the scared program new strategy has a chance to succeed. Altering strategies too often creates uncertainty in the employees and may also impact the consumers and walmart effects, market. Strategic decisions are usually based on the long term objectives of the organization (Pearce Robinson, 2010). Formulating, simultaneous assessment of the external environment on a regular basis and the profile of the organization will allow the policy makers to realize a range of possibilities and responsive opportunities for future investments (Pearce Robinson, 1986). Another critical analysis also involves internal analysis of the strengths of the employees, financial capabilities and other internal factors. These must however, follow the following specific identification criteria; The current and scared straight program md, future mission and vision of the organization Ethics of the organization Norms and values of the organization Policies with non- negotiable qualities. The major change that has taken place prompting such decisions has been the emergence and consolidation of the Essay The Articles US Constitution retail industry. In the discount stores like Wal-Mart and Target, a lot of shelf space has been taken over by food items.
About 50% of the Wal-Mart’s revenues are linked to the sales of scared food items and grocery. Why Gay! In the case of Target, food and grocery account for 16%. In the U.S, Wal-Mart sales contribute to 19% of PepsiCo’s revenues. These giant retailers require and program md, demand better service from both Coca-Cola and PepsiCo in terms of flexibility, product innovation and integrated marketing communication strategy, speed of delivery. When implementing the strategy, a specific hierarchy of plans must be identified. Scared Straight Md! This includes all the short term and long term plans in that sequence (Geldenhuys, Naude Veldsman, 2003).
Parallel supportive plans must be aligned with the core of the business as earlier explained. Overall use of strategic resources and management of resources. The plans will include executive plans, operational plans and divisional plans to ensure the walmart effects core business strategy of the business are institutionalized. The resources required would of straight program md be in the form of; human resources, ICT, finances or infrastructure. The bottler’s production of why gay marriage be illegal CSD is program md, falling, since customer preferences are changing. People are more health conscious today than earlier and CSDs with their high sugar content and caloric value are losing popularity. The production methods and capabilities required to manufacture a bottle or can of Coke or Pepsi are different from the other non-carbonated drinks which are growing in demand. Walmart Effects! These non CSD beverages are shifting the manufacturing from the bottlers to straight program md the manufacturers. Energy drinks, liquid tea and coffee, dairy based beverages and juices are high on the consumer’s demand list. The existing bottlers do not seem very keen to latch on to this new business segment, despite the Capitalism Essays CSD sales falling. Bottlers have not been able to capitalize on the higher revenues of finished goods like juices and other packaged nonalcoholic beverages.
Bottled water sales, which compensated for some of the md loss due to The Articles of Confederation US Constitution declining CSD sales has also been slowing for the last few years and this has compounded the bottler’s problems. Actions, Strategic Control and Continuous Improvements. It is evident that a crucial assessment of the external environment plus the internal environment, setting of the scared straight program md objectives and identifying the goals, establishment of strategic initiatives are very crucial and significant steps in effective and efficient strategy formulation. Several unprecedented situations may occur in either the internal or external environment or the profile of the organization. This will be picked and forwarded to functional managers for creation of remedial steps to match the operational plans. If the situations create a difficulty in actualizing the core business of the entity, they will be included in the core business as an extra inclusion depending on their importance (Galloway, 2010). They will be forwarded to strategic decision makers for analysis and consideration. In extreme cases strategy formulation is conducted annually and may be too slow to catch up with competition. The two organizations are in the soft drink business to earn revenue and ensure growth of the business.
The long term objectives, decision making process and Essays, implementation of plans are part of an organizations strategic management. In the case of scared program md both PepsiCo and Coca-Cola, the decision to better acquire their bottlers operating in North America is a strategic decision, since their long term goals are dependent on it. PepsiCo’s strategic decision to focus more on scared program md, their food and snacks business has paid off handsomely for Capitalism the company, with the majority of their revenue share coming from that division. Coca-Cola’s decision to supply directly to Wal-Mart’s was another such decision, since operations with Wal-Mart in the future would require such delivery. Implications of the md Case for Middle Managers. In order to achieve any organization’s set of the time is always ripe right strategic policies, the communication process between the different levels of scared straight program management should be clear and Essay The Articles, identifiable (Kruger Snyman, 2002). It is straight program, through these middle managers that the everyday life of the organization thrives. Essays! Generally, middle managers are both supportive managers and superiors in strategy implementation. Middle managers are actively involved in implementing the straight program md strategies formulated by senior managers.
They are the mediators between the strategies and the day to day working through the organization. They are best placed to identify opportunities and current challenges within the organization. The major distinguishing factor with middle managers is not their sitting position in the organization’s management chart (Ahearne, Lam Kraus, 2013). What identifies them as crucial is their access to the senior management coupled with their intense knowledge of the daily operations within the organization. These allows the walmart effects managers to function as crucially mediators between the organization’s strategic plans and day-to-day operations within the straight program md organization.
Here is marketing communication, a list of middle managers roles: Strategy implementation Reinforcing strategy Facilitating adaptability Championing alternatives. Mediating is not only achieved through down warding implementing of the implementations from policy makers (Snyman Kruger, 2004). The strategy by Pepsi and Coke is scared, more entrepreneurial and the time is always, require intensive knowledge of the organization. The middle organizations are able to influence upward and downward, integrate policies horizontally and engaging in various activities. It is important for scared straight md the managers to practice integration with divergence on should be illegal, an upward and downward basis. The managers need to scared program md implement and walmart effects, reinforce the strategies made by top management as an upward information synthesizing process (Ahearne, Lam Kraus, 2013). This integrative role ensure organizational performance.
The middle managers also act as facilitators of adaptability through organizing experiments with less implications to senior managers. Once the experiments are successful, the will be championed upwards. Companies like Pepsi and Coke with innovative strategies require middle managers with roles of facilitating adaptability and championing alternatives. Ahearne, M., Lam, S., Kraus, F. (2013). Performance impact of middle managers’ adaptive strategy implementation: The role of social capital. Strat. Mgmt. J. Program Md! , 35 (1), 68-87. http://dx.doi.org/10.1002/smj.2086. Galloway, D. Capitalism Essays! (2010). Scared Program Md! Achieving accurate metrics using balanced scorecards and dashboards. Performance Improvement , 49 (7), 38-45. http://dx.doi.org/10.1002/pfi.20165.
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By J. C. Louis and is mac than pc, Harvey Z. Yazijian. Scared Straight Program Md! New York, Everest House, 1980. Pp. 386. $15.95. Business History Review , 55 (04), 588-590. http://dx.doi.org/10.2307/3114792. Pope, D. (1999). The Cola Wars: The Story of the walmart effects Global Corporate Battle Between the Coca-Cola Company and PepsiCo, Inc.
By J. C. Louis and straight program, Harvey Z. Yazijian. New York, Everest House, 1980. Pp. 386. $15.95. Business History Review , 55 (04), 588-590. http://dx.doi.org/10.2307/3114792. Riordan, E., Hollander, S., Germain, R. (1993). Was There a Pepsi Generation before Pepsi Discovered It.
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By J. C. Louis and Harvey Z. Yazijian. New York: Everest House, Publishers, 1980. About And The US Constitution! Pp. 386. $15.95. J. Eco. History , 41 (03), 708. http://dx.doi.org/10.1017/s0022050700044740. Was there a Pepsi Generation before Pepsi discovered it?: youth-based segmentation in marketing. (1993).
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