Coke and Pepsi: from Global to Indian Advertising

Coca-Cola and Pepsi-Cola vied for a “throat share” of the soft drinks market for more than a century. Carbonated soft drinks (CSD) contributed to majority of the revenues in soft drinks. 丁he core market was Ihc United States which had high per capita consumption (see Exhibit 1 for per capita consumption of carbonates in select countries). The Americas accounted for 54% of the global CSD market. Europe for 34.5%, and Asia-Pacific for 1 \%.] The industry was characterized by the presence of strong brands - with three brands ㅡ Coca-Cola, Pepsi, and Sprite ranked 1, 23，and 61 globally and valued1 $70 billion. $14 billion, and S5.8 billion, respectively by Interbrand a leading brand valuation and consultancy firm.2 Advertising had played a major role in building the brands of the two majors which largely competed on parity pricing.

Until the mid-1990s，consumption of soft drinks in the United States steadily increased while that of milk and coffee declined. Thereafter, owing to shilling consumer prefcrcnccs towards healthier beverages, the US market began to plateau. This posed a challenge to the two majors. Was their era of susiained growth and profitability in CSD coming to an end or could they drive growth from emerging markets such as India? I low much should they invest in advertising? Should Indian advertising be shaped by global advertising?
GLOBAL SOFT DRINK LUSTRY

[he term usofl drink” was coined to distinguish flavored drinks from hard liquor. The soft drink industry was horn when Coca-Cola syrup was formulated in 1886 by John Pemberton, a pharmacist in the United States who sold it at drugsiore fountains as a potion for *'menial and physical disorders/0 Tn 1894. Coca-Cola granted its first bottling franchise which led to the proliferation of Coca-Cola throughout the United States by 1895. An infrastructure of independent bottlers added sweeteners and carbonated waters to the syrups and bases received from Coca-Cola to produce the drink to exact