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|Coca Cola Vs Pepsi: how a competitive brand proliferation has determined their dominance in the global soft drink industry? |
| | |It is not a foreign notion that both Coca Cola and Pepsi have been competing with one another in the global soft drinks industry for many years. From the | |early stages, of both the drink brands development from 1910, when Pepsi took on Coca Cola in the American carbonated drinks market franchising 24 | |states. Too the current day in which Coca Cola this year celebrated, 84 years of being the official sponsors of the Olympic Games. As well as Pepsi | |wining the bid for sponsorship of the Superbowl halftime show once more; with last year’s show being viewed by an estimated 114 million globally. | | | |Their soda war has been raging for over a century. When Caleb Bradham created Pepsi in 1898, Coca Cola had already been incorporated for 6 years by Asa | |Candler who purchased John S Pembertons Coke recipe, and was selling a million gallons a year. By the time Pepsi had franchised 24 states; Coca Cola had | |established bottling plants in Cuba, Canada and Panama and understood the power of advertising. Ploughing large amounts of profits into marketing with | |D’Archy Advertising Company. Over the next 20 years Pepsi suffers two bankruptcies the first in 1923, the start of World War I (WWI). When government | |policies on sugar rationing left the company with no other viable option and Pepsi Cola was sold to Craven Holdings Corp. After two years the trademark | |went bust once again in 1931. Here though good fortune comes in the form of Loft Inc a candy store chain, with its intuitive president Charles G Guth; | |they initiate the first competitive pricing strategy between the two firms. Pepsi Cola introduced the 12 ounce bottle for 5 nickel in 1933. With profits | |rising Pepsi produces their first advertising campaign for radio and jukebox: ‘Pepsi Cola Hits The Spot, Twelve Full Ounces That’s A Lot, Twice As Much For| |A Nickel, Too, Pepsi Cola Is The Drink For You’. During this time Coca Cola has established bottling operations in Bordeaux, Paris, Philippines’ | |establishing a global distribution network of resources. Resulting in a huge group investment of $25 million persuaded by Ernest Woodruff who would become| |President of Coke in 1923. The investment spurs Coke to spread to Australia Norway and South Africa. | | | |By 1959 Coke is now a registered trademark under the name of The Coca Cola Company, their first ever television commercial has been advertised and the | |company’s distribution network crosses 100 countries and 1700 plants. From the 1940’s onwards Pepsi have learnt from previous events and at the beginning | |of World War II (WWII) purchase a sugar plantation in Cuba to avoid disruption to business. They have also developed their products container to a can, a | |more progressive and modern aversion from the traditional heavy glass bottle. By 1959 Pepsi was now available in a 120 countries; differentiating their | |target market the youth nicknamed the ‘sociables’. At this point, for the first time both Coca Cola and Pepsi Cola are equals. In the sense...
References: |1. |Mark Pendegrast (2000). For God, Country and Coca Cola: The Definitive History of the World’s Most Popular Soft |
|2. |Stoddard (1997). Pepsi: 100 Years. US: General Publishing Group U.S. 1-208. |
|4. |J. C. Louis and Harvey Z. Yazijian. (1980). The Cola Wars: The Story of the Global Corporate Battle Between the |
| |Coca-Cola Company and Pepsico, Inc
|5. |Dubé, Jean-Pierre. (2005). Product differentiation and mergers in the carbonated soft drink industry. Product |
| |differentiation and mergers in the carbonated soft drink industry
 Kim Bhasin. (02/11/2011). COKE VS. PEPSI: The Amazing Story Behind The Infamous Cola Wars. Available: http://www.businessinsider.com/soda-wars-coca-cola-pepsi-history-infographic-2011-11?op=1. Last accessed 04/11/2012.
 Sports Illustrated. (2012). Pepsi named Super Bowl halftime show sponsor. Available: http://sportsillustrated.cnn.com/2012/football/nfl/07/24/pepsi-super-bowl-halftime-show.ap/index.html. Last accessed 04/11/2012.
 Coca Cola. (2012). History of the Coca Cola Company - Coca Cola GB. Available: http://www.coca-cola.co.uk/about-us/history-of-coca-cola-2000-now.html. Last accessed 04/11/2012.
 Pepsi Co. (2012). Brands. Available: http://www.pepsico.com/Brands.html. Last accessed 04/11/2012.
 Lewis, Helen. (2009). Global market review of functional soft drinks - forecasts to 2014: Market values and volumes for global functional soft drinks. Global market review of functional soft drinks - forecasts. 1 (1), 4-14.
 Dubé, Jean-Pierre. (2005). Product differentiation and mergers in the carbonated soft drink industry. Product differentiation and mergers in the carbonated soft drink industry. Journal of economics and management strategy 14 (4), 879-904.
Muris, Timothy J; Scheffman, David T; Spiller, Pablo T. (1992). Strategy and transaction costs - the organization of distribution in the carbonated soft drink industry. Journal of economics and management strategy. 1 (1), 83-128.
 Jansen, Jos. (2011). On competition and the strategic management of intellectual property in oligopoly. Journal of economics and management strategy. 20 (4), 1043-1072.
 Mark Pendegrast (2000). For God, Country and Coca Cola: The Definitive History of the World’s Most Popular Soft Drink. 2nd ed. US: TEXERE (Thomson Corporation). ix-621.
 Bob Stoddard (1997). Pepsi: 100 Years. US: General Publishing Group U.S.. 1-208.
 J. C. Louis and Harvey Z. Yazijian. (1980). The Cola Wars: The Story of the Global Corporate Battle Between the Coca-Cola Company and Pepsico, Inc. Business History Review. 55 (04), 386-590.
 Independent. (2012). Lord Coe sparks confusion and anger over Olympics sponsorship row . Available: Bob Stoddard (1997). Pepsi: 100 Years. US: General Publishing Group U.S. 1-208. Last accessed 04/11/1990.
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