Substitute products of coca cola
Soft drink industries face an intense competition from within its industry as well as from substitutes. The biggest competitor is Pepsi Cola which competes in all the same markets and even outsells it in some of them. Other direct competition comes from local cola drinks, as well as other soft drinks. Close competition comes from items like fruit juices and other similar beverages. Alternates or substitutes can include water or even coffee or tea as sources of caffeine.
The Threat of Substitutes
There is medium to high pressure from substitutes in the beverage industry. As a product, most people can´t differentiate the taste from other similar cola products. So for many, it is an interchangeable product. In addition, the rising awareness of cola products and their negative repercussions on health have led to other beverages such as water and juices becoming more sought after.
When can find that during the last years it is increasing a very big variety of sports and health based drinks in the market. In addition, chain stores such as Starbucks now offer a large variety of products that cater to different tastes, affecting cola sales a lot. For those looking for a caffeinated drink, there is always coffee and tea, both of which are now available in a myriad of flavours and tastes.
There are low switching costs associated with a move from the product to another. While Coca Cola does enjoy some brand loyalty, this usually extends to refusal to drink another cola but not a refusal to consume another kind of drink. The quality of the products, both competing soft drinks and substitutes are similar enough for the quality factor to not be an anchor for existing consumers.
It remains in the interest of the cola industry to attempt to keep consumers within the industry. That mean that collectively, any positive advertisements of one