Cola Wars: Case Write-Up for Many Decades, Essay

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Cola Wars: Case Write-Up

For many decades, the market for cola could be easily summed up as follows: Coca-Cola vs. Pepsi-Cola. Although Coke clearly dominated, Pepsi was a strong 'also ran,' particularly after branding itself as the taste of the Next Generation. However, in the 1990s, the palates of American consumers began to change, resulting in a sharp leveling off, and then a decline in soda consumption. The major soft drink companies had negotiated reasonably competitive agreements with the 'links' of their supply chains: smaller bottlers were dependent upon the major brands to survive and the major cola companies negotiated specific arrangements with bottlers to distribute only specific brands (such as Sprite rather than 7-Up, in the markets where these two uncolas were competing against one another). Coca-Cola dominated fountain sales, Pepsi concentrated on the retail market.

Analysis: Marketing gaffs and internal trouble at the organization caused Coca-Cola to lose market share. Pepsi engaged in more effective risk management by expanding into other retail venues, such as buying up well-known fast food chains; placing its emphasis on diet beverages; and promoting non-carbonated beverages. Although the individual markets for specific non-cola beverages like sports drinks…

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