Case Study Presentation on COKE V/s PEPSI

By :
Yogesh kumar Thawait Rahul Singh John sachin Khalkho Rounak Tiwari MA1160 MA1134 MA1115 MA1137

Summary of case study

This case is about coke and Pepsi how they both trying to gain market share in beverage market which is valued at over $30 billion a year.
Both the company is coming up with new products and ideas in order to increase their market share. Although the goal of both companies are exactly the same, but market strategies are different. Pepsi always took the lead in developing new product and new advertising ideas and Coke soon learned their lesson and started to do the same The creativity and effectiveness of each company's marketing strategy will ultimately determine the winner with respect to sales, profits, and customer loyalty. Both companies have also relied on finding new markets, especially in foreign countries & in foreign markets, Coke has been more successful than Pepsi.

 In some cases both the company failed in launching a new product. For coke, changing their original formula and introducing it as new coke was a major failure. Pepsi has also had its failures. Some of their failure included : Pepsi light , Pepsi free, Pepsi AM, and crystal Pepsi.

Pepsi CO Profile
PepsiCo is a world leader in convenience foods and beverages. Its world renowned brands are available in nearly 200 countries and territories.

PepsiCo entered India in 1989 and has grown to become the countrys largest selling food and beverage companies.
PepsiCo India have invested more than U.S.$700 million since the company was established in the country in 1989. Revenues in 2007 was more than $39 billion. 43 bottling plants in India, of which 15 are company owned and 28 are franchisee owned.

PepsiCos Frito Lay snack division has 3 state of the art plants.
It has more than 185,000 employees across the world. In India, PepsiCo provides direct employment to 4,000 people and indirect employment to 60,000 people including suppliers and distributors. CEO : Mr.Sanjeev Chadha. India Headquarters : Gurgaon

Coca-Cola profile
Coca-Cola is the most popular and biggest-selling soft drink in history, as well as one of the best known products in the world. It was created in Atlanta, Georgia, by Dr. John S. Penberton. Coca-Cola was first offered as a fountain beverage by mixing Coca-Cola syrup with carbonated water

It was their in India till 1977 but due to strong resentment against MNCS It was re-launched again in 1993 It has more than 230 beverages to its portfolio

By the end of 1993, a deal that gave Coca Cola, ownership of the nations top soft drink brand and bottling network.

With the acquisition of major brands in India it went on to be known as The Hindustan coca cola Beverages PVT LTD.

Q. Critically evaluate the case and analyze the marketing implication ?

We are trying to evaluate and analyze the case through four marketing Ps. Product

Price
Place Promotion

Product Strategy
of

COKE and PEPSI

The Coca-Cola formula is The Coca-Cola Company's secret recipe for Coca-Cola. As a publicity marketing strategy started by Robert W. Woodruff, the company presents the formula as one of the most closely held trade secrets ever and only a few employees know or have access to. This Coca-Cola formula appears to be the original formula to Coca-Cola. It is from the book For God, Country and Coca-Cola Pepsi is a main competitor of coke so both company is having a range of product in the global market .

Products of coke

Products of Pepsi

Pricing Strategy
Of Coke

Coke was a company ruling the markets before Pepsi entered. Earlier the price of coke was cost based i.e. it was decided on the cost which was spent on making the product plus the profit and other expenses.

But after the emergence of other companies especially the likes of Pepsi, CocaCola started with a pricing strategy based on the basis of competition. Nowadays more expenses are spent on advertising rather than on manufacturing Coke has brought in a revolution especially in Indian markets with the Rs. 5 pricing strategy which was very famous. It was the first company. to introduce the small bottle of Coke for just Re.5 This campaign was very successful especially with the price conscious Indian consumers. Even today most prices of Coke are decided on the basis of the competition in the market.

Pricing Strategy Of Pepsi

Pepsi again decides it price on the basis of competition.

The best think about the company Pepsi is that it is very flexible and it can come down with the price very quickly.
The company is renowned to bring the price down even up to half if needed. But this risk taking attitude has also earned Pepsi losses. Though lowering the price would attract the customers but it would not help them cover up the cost incurred in production hence causing them losses. This was the situation earlier but now Pepsi is a full-fledged and growing company. It has covered all its losses and is now growing at a rapid rate

Place strategies
Coca cola and PepsiCo are worldwide famous for their Distribution channel. In India the Distribution network of Coca cola had 6.5lakh outlets/distributors across the country in 2010 Pepsi Co's distribution network had 6 lakh outlets/distributors across the country in the Same year.

Coca cola and PepsiCo had formulated different distribution strategy for urban Sector and rural sector.
For the urban distribution channel these companies adopted the Model like direct store distribution, broker warehouse distribution and Vending & Food Service (V&FS) systems where as these companies are following the Hub and Spoke model Rural distribution channel, in which they divided the different categories of distributors according to the area they are covering.

Market share of soft drink in India

Promotional Strategies of Coke

Coca cola adopts various advertising and promotional strategies to create an increased demand in the market by associating with life style and behaviour and mainly targeting value based advertising. You are more likely to see a coke ad individualised for a particular festival or in with a general positive message. Coca cola uses CSR as its marketing tool to gain emotional benefits in consumers mind. The current promotions through CSR include Support my school campaign with NDTV. It has many brand ambassadors like Shahrukh khan, Hrithik Roshan, South Indian Actor Vijay and Trisha , Ghambir, Aamir khan etc and has signed contract recently with Imran khan. It allows price discounts and allowances to distributors and retailers in order to push more products into the market.

It employs both push strategy through promotions and pull strategy through advertisements and campaigns.
campaign ahead of IPL seasons

CSR OF COKE

Promotional strategies of Pepsi

With the swinging fortunes of cricket stars, PepsiCo India is gearing up to launch a brand new advertising campaign for Pepsi without any star endorsers. Currently, PepsiCo India has twelve star endorsers from Bollywood and the Indian cricket team. Pepsis new campaign will be a consumercentric advertising campaign without any celebrities, informed industry sources. Celebrities may come and go but brands are forever, seems to be PepsiCos new motto. Incidentally, PepsiCo has not yet renewed Sachin Tendulkars contract which expired in May this year. According to industry sources, PepsiCo is now shifting its marketing focus to MS Dhoni, the highest paid IPL player. The company will bring in MS Dhoni to the centre space from side lines. Of course, PepsiCo will make Dhoni wear some decent clothes to erase his Lungi-clad image, said Prahlad Kakar, a leading ad film maker in Mumbai. Remember Pepsi ads featuring Dhoni, captain of the Chennai

Yeh Dil maange more

SWOT(COCA-COLA)

SWOT (PEPSI)