COKE & PEPSI IN INDIA

Y YOGESH

ARJUN

Case Synopsis Competitive

Landscape

Industry Background

Key issues Next Steps

RATUL SWOT PEST

SIDDHARTH

Porter’s five forces Recommendations Alternative

scenarios

PRIYANKA Facts & Analysis Potential risks Risk minimization

EpiloguePRIYANKA

AGENDA

INDUSTRY BACKGROUND

An American multinational beverage company headquartered in Atlanta,

Georgia.

Invented in 1886 by pharmacist John Stith Pemberton in Columbus,

Georgia.

The Coca Cola formula and brand was bought in 1889 by Asa Griggs

Candler

Offers more than 500 brands in over 200 countries and territories with

over 1.7 billion servings each day.

Brands under the Coca Cola Company : Fanta orange, Limca, Sprite,

Thums Up, Maaza, Minute Maid, Georgia Gold, Vitingo, Kinley etc.

INDUSTRY BACKGROUND

Creator Caleb Bradham, a pharmacist in New Bern, North Carolina.

Pepsi was originally named “Brad’s Drink”

Created in 1893 and was later renamed Pepsi Cola in 1898

In 1931 the Pepsi Cola Company went bankrupt

In 1939, it was purchased by Charles Guth, the president of Loft Inc.

Pepsi is a known brand available in over 160 countries.

Brands under PepsiCo : Miranda, Mountain dew, 7Up,

Tropicana, Gatorade, Lay’s, Aquafina, Doritos etc.

Company’s expansion strategies to enter into

India

Problems faced with advertising scenario

Cola war between Coke and Pepsi

KEY ISSUES

“A journey begins”

Tactics of entering in India

Challenges faced

Advertising – “Backbone of both companies”

CASE SYNOPSIS

Coca Cola Advertising Campaign

"Hill top" Commercial Always Coca Cola Coca Cola Enjoy Thanda matlab Coca Cola Open happiness

 

Pepsi Advertising Campaign

This is the right choice baby “ah-ha"

The choice of a new generation

Ask for more "Youngistaan's WOW

COMPETITIVE LANDSCAPE

Strength• Brand recognition• Strong

Advertisement policy.

• It has got high market share

• It has got a very wide distribution channel

• Customer Loyality

Weakness• Produces just

carbonated soft drinks

• It has got high debt level

• It has got undiversified produt portfolio

Opportunities• High consumption

of bottled water• High demand for

healthy food/beverege

• More growth through acquisitions

Threats• Changing customer

choices• Scarcity of water• Competition from

other brands• Health issues

SWOT ANALYSIS

PEST ANALYSIS

SWOT ANALYSIS

Strength• It has got very good

brand portfolio• It is world's second

best selling soft drink brand.

• Constant product innovation.

Weakness• Its mostly

concentrated in North America

• It has got lower operation margin in India.

• Only targets young generation

• It has weak distribution channel

Opportunities• The increasing

population• The diversification• The changing social

trend• Growth in the

healthier beverages

Threats• Water scarcity is a

major issue• Changing consumer

preferences• Tough competion from

Coke.

PEST ANALYSIS

Rivalry among existing firms

1. High competition among Coke and Pepsi

itself

2. Low exit barriers

Threat of new entrants

1. Strong existence of current market players

2. Tough competition from coke and Pepsi

3. High investment on advertising

Bargaining Power of Suppliers

1. Freedom to select the suppliers

2. Companies face low switching costs.

3. Very minimal price difference among suppliers

Threat of substitutes

1. Traditional drinks

2. Non-Carbonated Soft Drinks

3. Other soft drinks keep coming in the market at low prices.

Bargaining Power of Buyers

1. Direct buyers have very less power to set prices.

2. Indirect buyers are highly fragmented.

PORTER’S FIVE FORCES

Low

High

Low

Low

High

1. Indianization

RECOMMENDATIONS

2. More usage of electronic & print media

3. To increase infrastructure

4. Tie ups with restaurant chains

5. Advertise in more traditional

way.

6. Focus on older generation

RECOMMENDATIONS

7. Brand awareness:

Promotional offers on festivals

Sampling in traditional fairs

RECOMMENDATIONS

Promotional campaigns

Sponsorship for

games like

Cricket & Hockey

Focus on “Youth”

ALTERNATIVE SCENARIOS

1. To capture local demand – “Indianization” is important

2. Print and electronic media were the most popular mediums.

3. To generate more sales increasing infrastructure was necessary.

4. India has its own food habits so to connect colas with that and advertise

in traditional way – a great necessity.

FACTS AND ANALYSIS

5. Indian people love to dine on occasions in restaurants so to increase

sales, tie-ups are best way.

6. Older people who stick to their traditional drinks need more focus so to

get them also to consume colas.

7. Brand Awareness:

i. Promotions on festivals- High consumption of food and beverages

ii. Sampling in fairs- Most popular medium of entertainment in 90’s

FACTS AND ANALYSIS

1. Indianization

It may lose its own originality and content

Be with original content and use effective advertisement to go local

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

RISKS & MINIMIZATION

2. More usage of

electronic

and print media.

Left the illiterate people untouched and reach to only who have TV and Radios.

Use of billboards, flyers, picture advertising on banners.

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

RISKS & MINIMIZATION

3. To increase infrastructure

High cost of Capital

By introducing cost effective infrastructure

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

RISKS & MINIMIZATION

5. Advertise in more traditional way.

Misconception might happen that it could only be consumed with snacks.

Emphasize on other aspects as well like thirst

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

RISKS & MINIMIZATION

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

6. Focus on older people

RISKS & MINIMIZATION

Might lead to message that its only for older people

Effective advertising - which shows people from all age groups

7. Brand awareness:Promotional offers on festivals

Sampling in traditional fairs

People might wait for promotions always to purchase.High cost and be given more in quantity.

Don’t do frequent promotionsTrain employees for sampling

RECOMMENDATIONS

POTENTIAL RISKS

RISK MITIGATION

RISKS & MINIMIZATION

Thorough local market research should be

done

Move to health drinks sector as per Indian consumers taste.

NEXT STEPS

Use instead of pesticides such

as: DDT, Malathion, Chlorpyrifos

Tooth decay due to presence of harmful

Acid

High fructose corn syrup resulting

in obesity and diabetes

Reduction of ground water table

EPILOGUE