Executive Summary
Throughout the late 1960’s and 1970’s the soft drink industry saw tremendous growth in the United States Markets increasing from 20.3 gallons per capita consumed in 1965 to 40.1 gallons per capita consumed in 1982; This explosion in growth led to the era of what has become known in the industry as the “Cola Wars.” As the consumer trended towards becoming more health conscious, the diet cola segment represented a significant opportunity for growth in the industry and companies were scrambling to understand how to position themselves for a competitive advantage. With an emphasis on sales and profit margins and looking to increase their market share organizations began to shift their attentions towards the internationals landscapes and primarily Europe. With scope of responsibility for operations, finance, marketing, and technology services in the United Kingdom, France, Holland, Ireland and Scandinavia, Peter Kendal, Pepsi-Cola’s Regional Vice President of Northern Europe, had spent several years (1980-1982) positioning Diet Pepsi for success over other industry competitors especially Coca-Cola. Kendal, however, was faced with the reality that over the next 4 months Coca-Cola intended to introduce Diet Coke into the United Kingdom Market. Despite having only approximately $200,000 in advertising monies for the next several months, Kendal needed to present a plan of attack focusing on maintaining high operating margins and market share.
Before formulating implantation strategies one must understand the landscape in which they operate. Traditionally, Coca-Cola had outpaced Pepsi-Cola by a ratio of 4:1 in international operations however Pepsi-Cola dominated the Europe and UK Diet segmentation and looked to maintain this momentum. Several other products occupied the space in which Pepsi competed including tea’s and coffee, squashes, and