Coke and Pepsi in the Twenty-First Century

In: Business and Management

Submitted By Nautica100
Words 2396
Pages 10
Running head: Cola Wars 1

Coke and Pepsi in the Twenty-First Century
University of Redlands
Deborah Bedgood-Ealy
Professor Richard Doyle
March 12, 2015 Coca-Cola and Pepsi function in the soft drink industry as dominating players and have remained market leaders for a long time. The key competencies of Coke and Pepsi range from the product, supply chain and distribution, marketing and customer loyalty. Each of them has developed operating procedure. The supply chain forms a major component or a competency that helps these companies form a competitive advantage for themselves (Wheelen & Hunger Page Ref: 332-335). Training of human resources also forms an important element as it helps strengthen the human resource. The main objectives of the training and the requirements are to be communicated to the employees along with details about when and where it has been organized. Several arrangements for the tainting session to be conducted, including the overhead projectors and stationary are to be arranged for in the office of Pepsi and Coke which leads to the strengthening of the human resources as an organizational resource (Page Ref: 246-247) The differences between resources important for competitive advantage and those that should be disinvested from industry/positioning perspective. The most important elements in this industry include the economics, market and competitive factors. The economic factors relate to the global economics conditions as the greatly impact the demand and consumption of soft drinks. This leads to there being a need for the marketers of the soft drink industry to ensure that the economics conditions of the markets that they enter or operate in are favorable and provide sufficient scope for them to operate successfully (Page Ref: 7 -10). The next most important elements is the market factors. As…...

Similar Documents

Cola Wars Continue: Coke and Pepsi in the Twenty-First Century

...4. ¿Pueden Coke y Pepsi mantener sus ganancias ante una demanda declinante y la creciente popularidad de bebidas no gaseosas?   Este problema lo obtuvieron ambas empresas desde el año de 1990 en el cual llevaban 2 años consecutivos donde el consumo anual por persona había disminuido, fue donde ambas empresas debieron de modificar su estrategia de comunicación en precio, embazado y la estrategia de la marca, así como también incluir en la marca productos de bebidas sin gas, tea, bebidas deportivas y agua embotellada. La estrategia que ellos han tomado en el negocio entero mejorando el proceso de entrega, de productos, de suministros para la producción, ha invertido en promoción y publicidad para impulsar las nuevas bebidas y las ya existentes. Desde el inicio de ambas compañías han luchado por la participación del mercado norteamericano y mundial introduciendo bebidas de sabores para seguir con la tendencia de crecimiento. Sin embargo ambas compañías no se dieron cuenta hasta después de hacer las investigaciones pertinentes que desde el año 1990 los consumidores empezaron a reflejar un cambio en el hábito de beber bebidas con gas y empezaron a tomar otro tipo de bebidas. Lo que paso con esto fue que el crecimiento fuera negativo o muy bajo sin embargo ambas marcas tiene una gran presencia en el mercado por lo cual la diversificación de productos según la tendencia del mercado. Si bien es cierto la competencia ahora es mayor sin embargo la estrategia de comunicación y de la...

Words: 297 - Pages: 2

Work Motivation Theory and Research at the Dawn of the Twenty-First Century

...Annu. Rev. Psychol. 2005. 56:485–516 doi: 10.1146/annurev.psych.55.090902.142105 Copyright c 2005 by Annual Reviews. All rights reserved First published online as a Review in Advance on June 21, 2004 WORK MOTIVATION THEORY AND RESEARCH AT THE DAWN OF THE TWENTY-FIRST CENTURY Gary P. Latham Rotman School of Management, University of Toronto, Ontario M5S 3E6; email: Craig C. Pinder Faculty of Business, University of Victoria, British Columbia V8W 2Y2; email: Key Words needs, values, goals, affect, behavior ■ Abstract In the first Annual Review of Psychology chapter since 1977 devoted exclusively to work motivation, we examine progress made in theory and research on needs, traits, values, cognition, and affect as well as three bodies of literature dealing with the context of motivation: national culture, job design, and models of person-environment fit. We focus primarily on work reported between 1993 and 2003, concluding that goal-setting, social cognitive, and organizational justice theories are the three most important approaches to work motivation to appear in the last 30 years. We reach 10 generally positive conclusions regarding predicting, understanding, and influencing work motivation in the new millennium. CONTENTS INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MOTIVATIONAL FRAMEWORK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...

Words: 15793 - Pages: 64

History of Coke and Pepsi

...1. INTRODUCTION 1.1 Brief History History of Pepsi:- Pepsi was first introduced as "Brad's Drink" in New Bern, North Carolina, United States, in 1893 by Caleb Bradham, who made it at his drugstore where the drink was sold. It was later labeled Pepsi Cola, named after the digestive enzyme pepsin and kola nuts used in the recipe. Bradham sought to create a fountain drink that was delicious and would aid in digestion and boost energy. In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore to a rented warehouse. That year, Bradham sold 7,968 gallons of syrup. The next year, Pepsi was sold in six-ounce bottles, and sales increased to 19,848 gallons. In 1909, automobile race pioneer Barney Oldfield was the first celebrity to endorse Pepsi-Cola, describing it as "A bully drink...refreshing, invigorating, a fine bracer before a race." The advertising theme "Delicious and Healthful" was then used over the next two decades. In 1926, Pepsi received its first logo redesign since the original design of 1905. In 1929, the logo was changed again. In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered bankruptcy – in large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a result of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Megargel was unsuccessful, and soon Pepsi's assets were purchased by Charles Guth, the President of Loft Inc. Loft was a candy manufacturer with retail...

Words: 9255 - Pages: 38

Effects of Globalization and Technology on the Twenty First Century Workplace

...Globalization and technology have made an impact on the twenty-first-century workplace and with the impact certain jobs are at risk while other jobs will be unaffected in terms of eradication. Globalization is the act of extending anything to other parts of the world and this has made the ability to acquire people with unique talents and skill far easier (outsourcing) and has also led to cultural diversity while affecting those cultures as well. Technology has diminished the requirement of people that could do basic job operations such as collecting cash at a toll booth by replacing workers with computer systems. Globalization and has impacted the twenty first century workplace by blending workers from all parts of the world leading to cultural and demand change while technology has improved work output, created new workplace rules, and has begun removing basic jobs. Globalization has brought upon many changes to the workplace; one of these changes lead to companies hiring workers from foreign countries in order to save more money; this is known as outsourcing. An example of outsourcing would be as follows; a company that makes computers can hire people in India to talk to customers that require technical support with the computers. Since hiring workers in India is far cheaper than in America it would make perfect sense to Outsource workers for other tasks that can be done without the workers have to be in the office at the same place. Outsourcing, however, can be a problem...

Words: 763 - Pages: 4

Coke and Pepsi

...Case Two: Coke and Pepsi learn to compete in India 1) The political environment has played key role in the following ways: Indian government viewed as unfriendly to foreign investors. Outside investment have been allowed only in high-tech sectors and was almost entirely prohibited in consumer goods sectors. If an item could be obtained anywhere else within the country, imports of similar items were forbidden. This gave Indian consumers have little choice of products or brands and no guarantees of quality or reliability. Also, Indian Laws, the government mandated that Pepsi’s products be promoted under the “Lehar Pepsi” name. For Coca-Cola, they attempted to enter into Indian market by joining with Parle and became “Coca-Cola India”. Some of these things may have been anticipated, especially the corruption within Indian government. As far as the contamination issues goes, that might not have been so easy to anticipate. Both companies held their own when trying to prove their products were within safe limits compared to other food products. They could have developments in political arena; Coke could agree to start new bottling plants instead of buying out Parle, and, therefore, wouldn’t agree to sell 49% of their equity. 2) Coca-Cola entered the market again a few years after Pepsi entered. While Coke's application was being denied, Pepsi's was being approved which gave them a head start in the market. Although it would seem that Pepsi would benefit from getting a......

Words: 756 - Pages: 4

The Importance of Marketing to Organisations in the Twenty-First Century

...Students are to individually complete a 3,000-word report entitled, ‘The Importance of Marketing to Organisations in the Twenty-First Century’. The report should: 1. Provide a case study of one organization which will provide the focus of the report, i.e. show via any one organization what marketing is, how this organization uses marketing strategies and techniques, why marketing is essential to this organization and how its use of marketing has changed and will change in the future. Theoretical models should be applied throughout. The case study should be integrated throughout the report with an analysis of the marketing process. 2. Be written, organized and laid out in an appropriate business report-like structure and format. (This will be discussed in lectures and seminars) 3. Contain recent material from the reading list and other relevant sources (including the media). 4. Use marketing models and examples throughout. 5. Contain a history and definition of modern marketing. 6. Explain the functions of marketing. 7. Describe the marketing process with particular emphasis on the development of integrated marketing strategies by organizations. 8. State why marketing is fundamental to the successful operations of an organization. 9. Outline recent changes in marketing and expected developments and challenges in the coming century. Developments in both technology and society are fundamental here. · Provide a personal statement (from each member of the group)......

Words: 416 - Pages: 2

Cola Wars: Coke and Pepsi in the 21st Century

...COLA WARS : COKE AND PEPSI IN THE 21ST CENTURY” INTRODUCTION "Cola Wars Continue: Coke and Pepsi in the 21st Century” explains the economics of the soft drink industry and its relation with profits, taking into account all stages of the value chain of the soft drink industry. By focusing on the war between Coca-Cola and PepsiCo as market leaders in this industry – with a 90% market share in carbonated beverages – the study analyses the different stages of the value chain (concentrate producers, bottlers, retail channels, suppliers) and the impact of the modern times and globalisation on competition and interaction in the industry. Throughout this analysis, I will assess how the strategic interaction between the two players allowed the creation of a “healthy" competition, where both companies need each other in order to remain competitive. Afterwards, I will go on to analyse the way that pricing and output decisions have affected the industry’s profits. Finally, I will discuss how Coca-Cola and PepsiCo could sustain their leadership in a market increasingly dominated by non-carbonated drinks. WHY IS THE SOFT DRINK INDUSTRY SO PROFITABLE? The soft drink industry refers to all drinks which do not contain alcohol. However, the original definition referred to carbonated and non-carbonated drinks made from concentrate. In this case discussion, I will take into consideration the US market, where the three major players – PepsiCo, Coca-Cola and Cadbury Schweppes –......

Words: 3841 - Pages: 16

Coke and Pepsi

...Financial Analysis: Coke vs Pepsi Computed 2009 Ratios and Commentaries (see table) Coke has higher operating and profit margin compared to Pepsi. The share price of Coke reflects a higher Price to Earnings ratio 18.4x compared to Pepsi 14.2x. This is likely due to the equity market having more confidence in the continuation and sustainability of Coke’s earnings than Pepsi. However, the equity market had priced a discount on Coke’s market capital structure compared to Pepsi. This can be seen from the market to book ratio where investors value Pepsi's balance sheet structure more than Coke. Pepsi is priced 5.5x of equity value compared to Coke which is priced only at 5x. Having a higher operating and profit margin, Coke is more likely to be able to sustain any shocks in the market (eg. from lower sales). The sustainability of Coke’s earnings are also helped by more efficient tax structure seen from lower effective tax rate compared to Pepsi. Its Selling General Administration expenses are also within the industry norm (compared to Pepsi). Coke’s has room to further improve its efficiency by improving its balance sheet structure. This includes a more efficient use working capital (eg. reducing receivables and inventory days), using higher leverage to attain higher return on equity and optimizing/sweating the assets more to generate higher asset turnover. Coke’s acquisition is substantially cashless. It exchanged $3.4bn of equity investment it had in CCE and...

Words: 443 - Pages: 2

Industrial Policy for the Twenty-First Century

...Faculty Research Working Papers Series Industrial Policy for the Twenty-First Century Dani Rodrik November 2004 RWP04-047 The views expressed in the KSG Faculty Research Working Paper Series are those of the author(s) and do not necessarily reflect those of the John F. Kennedy School of Government or Harvard University. Copyright belongs to the author(s). Papers may be downloaded for personal use only. INDUSTRIAL POLICY FOR THE TWENTY-FIRST CENTURY* Dani Rodrik Harvard University John F. Kennedy School of Government 79 Kennedy Street Cambridge, MA 02138 (617) 495-9454 Fax: (617) 496-5747 E-mail: This version September 2004 * This paper has been prepared for UNIDO. I am grateful to Francisco Sercovich for his guidance. I am also grateful to Robert Lawrence, Lant Pritchett, Andres Rodriguez-Clare, Andres Velasco, and especially Ricardo Hausmann and Roberto Unger for conversations over the last few years that led to the development of these ideas. None of these individuals should be held responsible for the views expressed here. I also thank Magali Junowicz for expert research assistance. I. Introduction Once upon a time, economists believed the developing world was full of market failures, and the only way in which poor countries could escape from their poverty traps was through forceful government interventions. Then there came a time when economists started to believe government failure was by far......

Words: 18461 - Pages: 74

Gulliver Disillusioned: Is Multiculturalism Dead in the Twenty-First Century?

...Gulliver Disillusioned: Is Multiculturalism Dead in the Twenty-First Century? On the 17th October 2010, Angela Merkel, chancellor of Germany, delivered a speech at a youth conference in Potsdam where she proclaimed that multiculturalism has “utterly failed” (Siebold, Reuters UK). This dire statement was pronounced in the midst of a German society torn by cultural tension between Germans and Muslim immigrants. In theory, a society that embraces multiculturalism is one in which two or more cultures coexist whilst harboring mutual respect for the other’s values and lifestyles and upholding a common national identity (Parekh 6). Multiculturalism implicitly assumes cultural equality, the notion that no culture is superior to another. The idea that cultural differences should be encouraged and protected is currently embraced by many Western political thinkers. The twenty-first century is an era of unprecedented globalization and cultural diffusion. However, the mingling of different cultures is often followed by disastrous consequences as seen in the turbulent political situation in Germany (Siebold, Reuters UK). Although Jonathan Swift wrote his travel satire Gulliver’s Travels in an age when multicultural societies had yet to emerge (indeed, cultural imperialism was the zeitgeist of the eighteenth century, an idea quite antithetical to multiculturalism), the cultural clash that Swift’s protagonist Lemuel Gulliver experiences with the foreign peoples he comes into contact with......

Words: 2621 - Pages: 11

Coke and Pepsi

...These days Coke and Pepsi are using the 4Ps of marketing mix (Price, Product, Place and Promotion) in such a way so that a good quality can be provided to the consumers at a reasonable price to attract the consumers towards their brands. Both the companies know that there is so much potential in the Indian soft drink industry and the can increase their sales by making good marketing strategies. So, they are spending a huge amount of money on advertising and other sales promotional activities of their brands SOFT DRINK INDUSTRY: AN OVERVIEW It all began in 1886, when a tree legged brass kettle in Hohn Styth pemberton’s backyard in Atlanta was brewing the first P of marketing leged. Unaware the pharmacist has given birth to a caromel colored syrup, which is now the chief ingredient of the world’s favorite drink. The syrup combined with carbonated the soft drink market. It is estimated that this drink is served more than one thousand million times in a day. Equally oblivious to the historic value of his actions was Frank Ix. Robinson, his partner and book keeper. Pemberton & Robinson laid the first foundation of this beverage when an average nine drinks per day to begin with, upping volumes as sales grew. In 1894, this beverage got into bottle, courtesy a candy merchant from Mississippi. By the 1950’s Colas were a daily consumption item, stored in house hold fridges. Soon were born other non- Cola variants of this product like orange & Lemon. Now, the soft drink industry has......

Words: 853 - Pages: 4

Pgdm Mba Material Case Study- Cola Wars Continue Coke and Pepsi in the Twenty-First Century

...9/8/2015 PGDM/MBA Material: Case Study- Cola Wars Continue: Coke and Pepsi in the Twenty-First Century Home Human Resource Marketing Information system management Images You are visitor # Case Study- Cola Wars Continue: Coke and Pepsi in the Twenty-First Century 110,588 Search This Blog Translate Select Language  ▼ Category Assignment Business Communication Business Environment Business Law Case Study Compensation MAnagement E- Business Summary: "Cola Wars Continue: Coke and Pepsi in the 21st Century” explains the economics of the soft drink industry and  its  relation  with  profits,  taking  into  account  all  stages  of  the  value  chain  of  the  soft  drink  industry.  By focusing on the war between Coca‐Cola and PepsiCo as market leaders in this industry – with a 90% market share  in  carbonated  beverages  –  the  study  analyses  the  different  stages  of  the  value  chain  (concentrate producers,  bottlers,  retail  channels,  suppliers)  and  the  impact  of  the  modern  times  and  globalization  on competition and interaction in the industry. Analysis: It is quite clear that there was a “war" between Coca‐Cola and PepsiCo: not only have they been rivals for entrepreneurship For your Information Formates Human Resource Management Human Resource Mangement Human resource Planning Indian Labour Law Industrial Relation Information system Management International......

Words: 1069 - Pages: 5

Coke and Pepsi

...Case Study, Coke & Pepsi Shuang Li Integrated Marketing, Section 008 September 12th, 2015 1. Why, historically, has the soft drink industry been so profitable? Customer High consumption need in the market. Since 1970 consumption of CSDs grew by an average of 3% per year for 30 years. Compare to other beverage, Americans drank more soda. Market Environment The soft drink industry just likes an oligopoly market, and Coke and Pepsi have too big market share to affect the industry. Therefore, other companies are very difficult to entry this industry Little capital investment and material cost The soft drink producers do not need much investment in machinery, labor, and overheads, so they can save their capital investment. Substitutes Although there are lots of substitutes, like beer, milk, coffee, but they do not have huge marketing. However Coke and Pepsi spend a lot on advertising and brand building, so they got brand loyalty. 2. Compare the economics of the concentrate business to that of the bottling business: Why is the profitability so different? Bottlers need huge capital to invest in their manufacturing processes, while concentrate companies do not need that much costs. 3.How has the competition between Coke and Pepsi affected the industry’s profits? The competition between the Coke and Pepsi often led to price war, which are companies offering products at discounted prices. This activity always makes lower price, and it weaken the......

Words: 327 - Pages: 2

Pepsi Coke

...STRATEGIC MARKETING Group Presentation Overview of Indian Market- Past • • • • • In the year 1991, the Indian Government adopted Economic Liberalization Policy “Cold Drinks” as popularly known in India were an Urban phenomenon and the favorites (soda based) were Campa Cola, Gold Spot, Limca and Thums Up Pepsi entered in the Indian Market as Pepsi Foods Ltd. and was known as Lehar Pepsi Coke tried to reenter* in 1990 by merging with Godrej but was denied; merged with Britannia Industries India Ltd. July 1993 Parle sold its brands and plants to Coke *Coke was present in India from 1970’s, but was banned in 1977 under FERA Overview of Indian Market- Present • • • • Today the Indian Market for Carbonated Drinks is worth more than Rs.17000 crore The present scenario of the carbonated drinks market is duopoly* situation. Although in every place there are local competitors and there is a huge unorganized flavored water market. As far as the carbonated drinks are concerned there are only two brands (as per the Market Share). – Coke (57.8%) – Pepsi (35.6%) *A duopoly is a competitive situation where there are two competitors, normally of roughly equal size. Coca-Cola BACKGROUND Coca- Cola Milestones • • • • • • • • • 1886: Founded by John Pemberton 1887: Registered as trademark. 1895: Sold in every state & territory in US. 2003: Headquartered in Atlanta with divisions & local operations in over 200......

Words: 1847 - Pages: 8

Capital in the Twenty-First Century

...Capital in the Twenty-First Century Capital in the Twenty-First Century, is a book written by the French economist Thomas Piketty, and published 2014. He also reviews the pertinent aspect of the works done by previous authors on this subject (Karl Marx, Arthur Young, David Ricardo and Simon Kuznets) and details historical changes in the concentration of income and wealth. He takes a profound look at the evolution of inequality since the beginning of the industrial revolution. In the 18th and 19th centuries western European society was highly unequal. Private wealth dwarfed national income and was concentrated in the hands of the rich families. This system persisted even as industrialization slowly contributed to rising wages for workers. Only the chaos of the first and second world wars and the Depression of 1929 disrupted this pattern. High taxes, inflation, bankruptcies, and the growth of sprawling welfare states caused wealth to shrink dramatically, and ushered in a period in which both income and wealth were distributed in relatively egalitarian fashion. But the shocks of the early 20th century have faded and wealth is now reasserting itself. From this history, the author derives a theory of capital and inequality. As a general rule wealth grows faster than economic output, he explains, a concept he captures in the expression r > g (where r is the rate of return on capital, including profits, dividends, interests, rent and other income from capital expressed as...

Words: 338 - Pages: 2