Competitors Analysis - Soft Drink Industry
Executive Summary Competition
In 2005, the global carbonated soft drink (CSD) market generated revenues of over $147 billion, all of which comes from three global powerhouse companies occupying 90% of the market. Coca-Cola, Pepsi, and Cadbury Schweppes, are one, two and three, respectively, in the very competitive CSD industry. Over past decades, the CSD market has been honored with record growth, showing consumption rates that have more than doubled over the last 25 years. Americans are consuming twice as many beverages as they were 25 years ago; however, while carbonated soft drinks continue to remain the most popular beverage, consumer preferences are changing to include other types of beverages, such as waters, juices, and other drinks perceived to be a healthier alternative. The changes in preferences and overall increases in new alternatives are beginning to bring the total consumptions rates for CSDs down from their 25 year high.
In 2004, 10.24 billion cases were sold, while 2005 showed a 0.6% decrease translating to 10.18 billion cases. This 2005 decline came after a small growth in both 2003 and 2004. Coca-Cola lost some market share, Pepsi gained some, and diet drinks seems to be what is fueling the overall category growth. Dr. Pepper, Cadbury Schweppes' only US sold CSD, was the only beverage to have growth in the US in 2005. This was due in part to the launch of Diet Cherry Vanilla Dr. Pepper.
As mentioned above, the top-three players in the CSD market are Coca-Cola, Pepsi, and Cadbury Schweppes (Dr. Pepper). Coca-Cola continues to hold the lead position with a market share of 45%, but Pepsi and Cadbury Schweppes are not far behind with 32% and 15%, respectively. At this stage in this very mature market, the only way market share will change significantly is through takeovers. However, the takeover targets that exist are so small, that the market share increase would be approximately 1%.
Despite the 2005 decrease in consumption, three-year sales
In 2005, the global carbonated soft drink (CSD) market generated revenues of over $147 billion, all of which comes from three global powerhouse companies occupying 90% of the market. Coca-Cola, Pepsi, and Cadbury Schweppes, are one, two and three, respectively, in the very competitive CSD industry. Over past decades, the CSD market has been honored with record growth, showing consumption rates that have more than doubled over the last 25 years. Americans are consuming twice as many beverages as they were 25 years ago; however, while carbonated soft drinks continue to remain the most popular beverage, consumer preferences are changing to include other types of beverages, such as waters, juices, and other drinks perceived to be a healthier alternative. The changes in preferences and overall increases in new alternatives are beginning to bring the total consumptions rates for CSDs down from their 25 year high.
In 2004, 10.24 billion cases were sold, while 2005 showed a 0.6% decrease translating to 10.18 billion cases. This 2005 decline came after a small growth in both 2003 and 2004. Coca-Cola lost some market share, Pepsi gained some, and diet drinks seems to be what is fueling the overall category growth. Dr. Pepper, Cadbury Schweppes' only US sold CSD, was the only beverage to have growth in the US in 2005. This was due in part to the launch of Diet Cherry Vanilla Dr. Pepper.
As mentioned above, the top-three players in the CSD market are Coca-Cola, Pepsi, and Cadbury Schweppes (Dr. Pepper). Coca-Cola continues to hold the lead position with a market share of 45%, but Pepsi and Cadbury Schweppes are not far behind with 32% and 15%, respectively. At this stage in this very mature market, the only way market share will change significantly is through takeovers. However, the takeover targets that exist are so small, that the market share increase would be approximately 1%.
Despite the 2005 decrease in consumption, three-year sales