Coke Vs Pepsi Essay Research Paper Mounting

Coke Vs Pepsi Essay, Research Paper

Mounting competition between Coca-Cola (Coke) and Pepsi Cola (Pepsi) had a very long standing in the American history. Both cola have thus made themselves a household name in the global market, almost 200 countries since their introduction at the turn of the 19th century.

The history of beverages industry begins in May 1886, when Atlanta chemist ??Doe?? Pemberton developed a drink mix with caramel coloured ingredients, coca leaves, kola nuts and cocaine. The drink was first designed as a drug to help people feel better. Some time later, carbonated water was added to the syrup and that is how Coca-Cola was invented. Caleb Bradhem, a New Bern, N. C pharmacist, created Pepsi in the late 1890s almost ten over years after Coke was introduced into the beverages industry. Since then, these two cola company had been vying for the market share in its birthplace and also globally.

Being the world leading manufacturer, marketer, and distributor of the non-alcoholic beverages, the Coca-Cola Company??s and its subsidiaries employs 31,000 people around the world. PepsiCo, Inc. is among the most successful consumer products companies in the world had a workforce of 151,000. It was founded in 1965 through the merger of Pepsi Cola and Frito-Lay. Tropicana was acquired in 1988.The workforce of PepsiCo, Inc consist of:

Pepsi-Cola Company, the world??s second largest beverage company

Frito-Lay Company, the world??s largest manufacturer and distributor of snacks chips

Tropicana Products, Inc., the world??s largest marketer and produces of branded juices

With the potential of 6 million customer globally, these 2 companies had strive hard to compete against each other with the marketing campaign and strategies.

When Roberto Goizueta took it helms in 1980, the Coca-Cola Company was in a mess, especially in responding strategically opportunities and threats. The corporate-wide culture of risk avoidance and passiveness had limited the growth opportunities of the company. Pepsi introduce its campaign in Dallas, Tex, 1975, the Pepsi Challenge. Around the nation, both cola were brought to the street for consumer to taste and Pepsi had emerged as the winner of this campaign. Even the soft drink market was dominated by these two cola company, the onslaught of the Pepsi Challenge in the seventies and eighties had left coke battered and weary.

The environment factors of marketing

In the competitive world of marketing, the forces of environment factors governed the success of the company. These environmental factors are generally referred to the physical forces such as air quality, water pollution, disposal of solid waste and conserving natural resources, which are term as external environmental forces to the organisation and is uncontrollable. However, within the organisation, there lie the external and internal environmental forces that are controllable by the organisation itself.

The two distinctive external environmental forces are macroenvironment and microenvironment. The six elements of the macroenvironmental forces are:

?h Demographic

?h Economic Conditions

?h Competition

?h Social and cultural forces

?h Political and legal forces

?h Technology

The Coca-Cola Company term the demographic influences as the most critical when it tries to sell its flagship to the global market. Having recognised that, she started the bottling system. This implementation had however turned out to be the strength of the Coca-Cola Company. Under this system, she had further classified its bottles into three kind of relationship:

1. Independently own bottlers, in which she had no ownership interest

2. Bottlers in which she have invested and have a non-controlling ownership interest

3. Bottlers in which she have invested and have a controlling ownership interest

During 1999, the first two types of bottlers produced and distributed approximately 27% and 58% of the company world wide unit case volume. As for the controlled bottling operations, it only contributed and distributed approximately 15%. In view of the results from the non-controlled bottlers, the Coca-Cola Company views them as key or anchor bottlers due to their level of responsibilities and performance. The strong commitment of both bottlers to their own profitable volume growth helps the Coca-Cola company to meet its strategic goal and further the interest of its world wide production, distribution and marketing system. These bottlers tend to be large and geographically diverse, with strong financial resources for long-term investment and strong management resources. With them, the Coca-Cola Company is able to gain many strategic business partners in every major continent.

Marketing strategies Planning

Marketing and promotion of Coke went as far back as in 1891, when Asa Candler took charge. He handed out coupons for one free glass for coke. He also promoted the beverage by painted walls, clocks , outdoor poster, serving trays and fountain urns. Candler marketing strategy worked Coke was available everywhere. The sales took off, and by then, Coke is drank in every state and territory in the United States.

The strategic marketing planning is a five-step process:

1. Conduct a situation analysis

2. Develop marketing objectives

3. Determine positioning and differential advantage

4. Select target markets and market demand

5. Design a strategic marketing mix

Pepsi had always been the innovators in developing new products and its marketing strategies. In 1975, the Pepsi Challenge was launched in Dallas, Texas. This marketing campaign was a success as the sales of Pepsi rose between 1975 to 1983.

Pepsi prefers to segment itself as the beverage choice of the ??New Generation??, Generation Next, or just as the as the ??Pepsi Generation??. These terms adopted in Pepsi??s advertising campaigns are referring to the markets that marketers refer to as Generation X.

The Generation X consumer is profiled to be between the ages of 18 to 29. They have high expectation in life and are very mobile and active. They adopt a lifestyle of living for today and not worrying about long term goals. Those main emphases on this segment they have also have a focus on the 12 to 18 years old market. Pepsi believes that if they can get this market to adopt their product then they could establish a loyal customer for life.

Pepsi Cola is situated in an industry that is dominated by two competitors, Coca-Cola and of course themselves. Although Pepsi and Coke basically go after all consumer who purchase soft drink beverages, Coca-Cola targets its product at the head of household, This is evident in many of the ad campaign such as ??Always Coca-Cola??, which refers to the traditional beverage heritage of its products. They also reinforce this in the name, ??Coca-Cola Classic?? which is referring to the older consumer. This name reflects an image of value, reliability and old time values.