STATEMENT OF THE PROBLEM
The Coca-Cola Co. is the leading company in the beverage Industry. It produces about 400 brands consisting of over 2,600 beverage products. Its major rivals are PepsiCo and Cadbury Schweppes PLC. The PepsiCo obtains 60% of its Revenues from its snack division. Cadbury Schweppes PLC is the largest confectionary company and has a strong regional beverage presence in the Americas and Australia.
Considering its rivals’ success in its snack division; The Coca-Cola Co. is considering to enter in the snack business as well.
This Case Analysis aims to identify the possibility of success for the Coca-Cola Co. in entering the snack business considering social, economic and other worldwide issues. Else, other possible courses of action to promote sales of already existing products.
II. FACTORS OF CONSIDERATION
The trend toward healthier eating and drinking is growing rampantly throughout the world. Many states in the U.S. ban soft drink products in public schools because of obesity issues. The use of some ingredients in Coke products may be hazardous to one’s health and regulations may soon require warning labels.
Coke collaborated with the Apple iTunes in a digital program that focuses on youth sensitivity marketing, the company commits not to advertise to target audiences under the age of 12 has gained the respect European Commission.
Cadbury Schweppes PLC plans to divest its beverage division on 2007. Hershey Foods has expressed interest as well as various private-equity firms. Federal regulations prohibit PepsiCo and Coke from bidding for Cadbury’s carbonated soft drink business. Analysts however believe that the brand Snapple which Cadbury sells would be a good fit for Coke. PepsiCo would likely benefit most from acquiring Cadbury’s Mexican Assets with such strong brands as squirt, crush and Canada Dry.
The 50-50 joint venture between Nestle and...
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