purchasing Crush‚ Cadbury executives needed to restructure the Crush brand to gain a higher market share while neither contradicting its current brand image nor cannibalizing Sunkist soda sales. Restructuring is to occur through revitalizing the bottling network‚ developing a brand position‚ and developing a new advertising and promotion program. Analysis and Evaluation When Cadbury acquired Crush in 1989 they discovered that Crush was available in markets that represented only 62% of orange category
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Case Part 1: Why was concentrate manufacturing profitable until the late ‘90s? Porter’s Five Forces provides an in-depth understanding as to how the interconnected relationship between Entrants‚ Buyers‚ Suppliers‚ Substitutes‚ and Rivals allowed concentrate producers to increase profitability. Entrants: Existing Concentrate Producers create high barriers to entry Despite low capital requirements to enter the market‚ dominant concentrate producers successfully restricted new entrants
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1. Compare the economics of the concentrate business to that of the bottling business: Why is the profitability so different? The reason why their profitability is so different can be known by the fact that the costs they have to meet differ greatly. The concentrate producers need lower cost for building a manufacturing plant about $25 million to $50 million‚ and just one plant is needed. Concentrate producers pay the costs for advertising‚ promotion‚ market research‚ and bottler support. They
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profitable‚ more so for the concentrate producers than the bottler’s. This is surprising considering the fact that product sold is a commodity which can even be produced easily. There are several reasons for this‚ using the five forces analysis we can clearly demonstrate how each force contributes the profitability of the industry. Barriers to Entry: There are several major barriers to enter CSD industry. The value chain of the company consists of concentrate producer‚ bottlers and retailers. Assuming
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9-711-462 REV: MAY 26‚ 2011 DAVID B. YOFFIE RENEE KIM Cola Wars Conti inue: Coke an Peps in 201 C nd si 10 Fo more than a century‚ Co and Pepsi vied for “th or oke hroat share” o the world’s beverage m of s market. The most intense battles in the so-called col wars were fought over the $74 billio carbonated soft m b la e on drink (CSD) indus stry in the Un nited States.1 In a “carefu ully waged co ompetitive str ruggle” that l lasted from 1975 through the mid-199
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9-711-462 REV: MAY 26‚ 2011 DAVID B YOFFIE RENEE KIM Cola Wars Contiinue: Coke C an nd Pepsi in 20110 oke and Pepsi vied for “t hroat share” o of the world’ss beverage m market. For more than a century‚ Co The most intense battles in the so-called colla wars weree fought over the $74 billio on carbonated soft drink (CSD) industry in the Un nited States.1 In a “carefu ully waged co ompetitive strruggle” that llasted from 1975 through the mid-199 90s‚ both Cok ke and Pepsi achieved average annual
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BUAD497 Strategic Management Fall 2011 Session 3: Cola Wars Continue: Coke and Pepsi in 2010 Sun Hyun Park‚ Ph.D. Assistant Professor Marshall School of Business University of Southern California “Cola Wars” Blind Test “Can you tell the difference?” Student A 1: Coca Cola Student B 1: Big K Cola (Kroger) 2: Pepsi 3: Coca Cola Student C 1: Pepsi 2: Pepsi 3: Big K Cola (Kroger) 2: Coca Cola 3: Big K Cola (Kroger) Agenda for Today • Recap - Value chain analysis - Five Forces
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Introduction Case studies allow understanding and analyzing‚ the business scenario in better way. They help to facilitate learning and building strategies while one is working. The following report highlights three cases‚ Shimla dairy‚ The Cola Wars and Starbucks. Different tools for analyzing these cases can be applied in order to understand them in a better way. Some of the tools are: - * PEST Analysis * SWOT Analysis * Advantage of first mover * Barriers to entry * Buyers
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. . Pepsi.1 This cozy relationship was threatened in the late 1990s‚ however‚ when U.S. CSD consumption dropped for two consecutive years and worldwide shipments slowed for both Coke and Pepsi. In response‚ both firms began to modify their bottling‚ pricing‚ and brand strategies. They also looked to emerging international markets to fuel growth and broadened their brand portfolios to include non-carbonated beverages like tea‚ juice‚ sports drinks‚ and bottled water. Do As the cola wars
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and snack acquisitions. No As the cola wars continued into the 21st century‚ Co ke and Pepsi faced new challenges: Could they boost flagging domestic CSD sales? How could they compete in the growing non-CSD category that demanded different bottling‚ pricing‚ and brand s trategies? What had to be done to ensure sustainable growth and profitability? Economics of the U.S. CSD Industry
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