Cola Wars (Porter’s Five Forces) Barriers to entry The barriers to entry are high for new companies; therefore‚ the threats of new entrants are low. For example‚ retailers enjoy significant margins for their bottom-line. This makes it tough for the new entrants to convince retailers to substitute their new products for Coke and Pepsi. There are an economy of scale‚ high required investment‚ high costs for advertising and marketing promotion‚ high channels of distribution‚ and high products differentiation
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Cola Wars Case Analysis 1. The main way in which my case notes would be different for Cola Wars if I were to have a second try at writing them would be to include a breakdown of how they are able to apply to Porter’s five forces. For example‚ it is evident after reading this case that the soft drink industry is an extremely profitable one (especially for Coke and Pepsi). The reasons for this were discussed in class‚ and I will quickly explain each: There are great barriers to entry when trying
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packaging and sweeteners and it accounts for high portion of sales. However‚ the bottlers are allowed to handle the non-cola brands as well and they have the right to decide on final retail pricing; and top bottlers get contribution from the main companies such as Coca-Cola. 2. How has the competition between Coke and Pepsi affected the industry’s profits? In the 1980s‚ Cola Wars between Coke and Pepsi started to heat up. To get more profits than the other‚ they tried in doing so many things
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Cola Wars Pepsico – Profile PepsiCo is one of the world’s leading producers of snack foods and beverages including Pepsi soda. Its principal businesses include: Frito-Lay snacks‚ Pepsi-Cola beverages‚ Gatorade sports drinks‚ Tropicana juices and Quaker foods. PepsiCo brands are available in nearly 200 countries and territories. The company operates in four divisions: PepsiCo Americas Foods (PAF)‚ PepsiCo Americas Beverages (PAB)‚ PepsiCo Europe‚ and PepsiCo Asia‚ Middle East and Africa (AMEA).
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MKTS 7303 - PRINCIPLE OF STRATEGIC MANAGEMENT Cola Wars (Coke and Pepsi 2010) Case Study - Week 4 (S42166755) 1. Compare the competitive dynamics of the concentrate business to that of the bottling business? Why is the profitability so different? By using Five Forces Model by Michael Porter‚ it will shows competitive dynamics in the industry. Therefore‚ to define everything further this model will be used to do the comparison between concentrate business (CB) and bottling business (BB).
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Cola War Soft drinks are profitable because it is a $60 billion industry in the United States alone. Not only is it profitable in the United States‚ but both Pepsi and Coca-Cola have expanded their franchises internationally and both have become competitive brands. It is estimated that the average American can consume about 53 gallons of carbonated soft drinks a year. According to the article‚ Americans drink more soda than any other beverages on the market today‚ such as sports drinks‚ juices
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HTM 4101 Strategic Management Cola Wars case study – Five forces analyses Concentrate producers: Bargaining power of buyers: Refer to the case‚ direct buyer is the bottler and indirect buyers are the end consumer and suppliers such as supermarkets and other outlets. Bargaining power of buyers for concentrate producers refers to the bargaining power of the bottlers. From the industry perspective‚ it is true that bottler could choose to switch their concentrate producers. Bargaining power
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Eriko Ishikawa and Alexis Geaneotes © 2009 Harvard Kennedy School and International Finance Corporation This report is a summary version of a longer research study undertaken by the IFC and the CSR Initiative at the Harvard Kennedy School. The full report will be available on the CSRI website at: www.hks.harvard.edu/m-rcbg/CSRI Acknowledgements: The authors would like to thank Adrian Ristow‚ Marika McCauley Sine and Euan Wilmshurst from The Coca-Cola Company for their inputs in project design
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and competition are ultimately responsible for industry profitability‚ an analysis of the five competitive forces offers an explanation for the success of the soft drink (CP) industry. The soft drink industry benefits from generally benign forces. Colas characterized the first 50+ years of the soft drink industry‚ with Coke and Pepsi accounting for the top brand names. While substitutes for soft drinks certainly exist‚ the major players in the CP industry have successfully shaped this competitive
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was spending less money and gaining market share‚ what were they doing right? Research is an essential step in advertising because money cannot be wasted‚ there are many other uses within the company which money could be used for. In order for Coca-Cola to improve the above stated problems and improve their marketing research‚ the company could do a number of things. When the flavor changed of Coke‚ many were upset about this‚ even though a study was done to determine if the change should happen.
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