This Case is about COMPETITION, COMPETITIVE STRATEGY, FINANCIAL MARKETS, INTERNATIONAL BUSINESS, MARKETING
PUBLICATION DATE: May 09, 2006 PRODUCT #: 707S06-HCB-SPA
This note analyzes the industry structure and competitive strategy of Coca Cola and Pepsi over 100 years of competition. Both companies also started to change brand strategies, pricing, and their bottling. They considered emerging international markets to fuel increase and expand their portfolios of alternative beverages like juice, tea, sports drinks, energy drinks, and bottled water. Coca Cola and Pepsi Cola had vied for the “throat share” of the world’s drink marketplace. In a “carefully waged competitive battle,” from 1975 to 1995, both the brands Coke and Pepsi had reached average annual increase of around 10%, as both U.S. and global CSD consumption consistently increased. This cost scenario was endangered in the late 1990s, nevertheless, when U.S. CSD consumption decreased somewhat before reaching what seemed to be a tableland. Considers whether this clear slow down was only another blip in the course of a century of enviable operation or whether Coke’s and Pepsi’s age of continual growth and profitability was coming to a close.