Cola Wars Continue Coke vs Pepsi in the Twenty First Century Case Solution

Case Solution

Analyzes the dwelling and competitive manner of Coca-cola and Pepsi on the century of competition. New challenges in the 21st century incorporated enhancing flagging domestic cola sales and finding new revenue streams. Both firms also began to alter their bottling, prices, and brand techniques. They looked to emerging worldwide areas to fuel growth and broaden their brand investment investment portfolios to include non bubbly drinks like tea, juice, sports drinks, and canned water. For over a century, Coca-Cola and Pepsi-Cola had vied for your throat share in the world's beverage market. Most likely probably the most intense battles in the cola wars were fought against against inside the $60 billion industry inside the US, where the average American consumes 53 gallons of bubbly sodas (CSD) every year. In the carefully fought against competitive struggle, from 1975 to 1995 both Coke and Pepsi had accomplished average annual growth and development of around 10% as both U.S. and worldwide CSD consumption consistently rose. This cozy situation was threatened inside the late the 19 nineties, however, when U.S. CSD consumption dropped for just two consecutive many worldwide shipping slowed down lower for Coke and Pepsi. The case sights whether Coke's and Pepsi's era of sustained growth and profitability was going to an in depth or maybe this apparent recession was only another blip within a century of alluring performance. A rewritten type of a young case by Michael E. Porter and David B. Yoffie.

Excel Calculations

Questions Covered

1. Why was it that the concentrate producers have been so profitable?

2. Compare the profitability of the concentrate industry to the bottling industry -- why is the profitability so different?

3. What is happening in the soft drink industry? What are the challenges facing the industry?

4. Why was the Pepsi Challenge so successful? How would you evaluate Coke's response?

5. What should Coke and Pepsi do next?

6. How has the competition between Coke and Pepsi affected the industry’s profits?

7. Can Coke and Pepsi sustain their profits in the wake of flattening demand and the growing popularity of non-carbonated soft drinks?