Study, Coke & Pepsi Shuang Li Integrated Marketing, Section 008 September 12th, 2015 1. Why, historically, has the soft drink industry been so profitable? Customer High consumption need in the market. Since 1970 consumption of CSDs grew by an average of 3% per year for 30 years. Compare to other beverage, Americans drank more soda. Market Environment The soft drink industry just likes an oligopoly market, and Coke and Pepsi have too big market share to affect the industry. Therefore
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The soft drink industry is very profitable and it can be analyzed using Five Forces analysis. Each force contributes in different extent to the industry profitability. The supplier power is low. The input required by concentrate producers (CP) consisted of color, citric acid, natural flavors and caffeine; while bottlers mainly purchased packaging (including cans) and sweeteners. These inputs are all relatively standardized materials that can be easily found and bought from large amount of suppliers
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My the product is the Stunts Energy Drink. Just one sweet sip will make you crave more. There are no horrible side effects like other energy drinks, such as drowsiness afterwards or sugar crashes. Just sip and go. Your energy is instantly replenished as you drink the refreshing citrus juice. Stunts Energy Drink advertisements would be all around. Newspapers, magazines, billboards, on the side of buses, even on tv. The eye catching ad would be placed in the front to middle section of the magazine
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Marketing Executive of Dr. Pepper Snapple Group, Inc. only major nonalcoholic beverage company in USA launched Accelerade RTD brand. Launching such a product is not only creating a new brand, it is entering new segment of market, going from CSD (carbonated soft drinks) and producing ready to drink tea to new segment, segment of Functional Beverages. The market segment of Energy Beverages (Functional Beverages) is field of huge battle field of many competitors, and idea to enter it is under question mark.
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Carbonated Soft Drink Industry Analysis A framework, known as the five forces model, was created by Michael E. Porter to assist managers with identifying opportunities and threats within an industry by analyzing the competitive forces. His five forces consist of: the risk of entry by potential competitors, the intensity of rivalry among established companies within an industry, the bargaining power of buyers, the bargaining power of suppliers, and the closeness of substitutes to an industry’s
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High Fructose Corn Syrup Terry Johnson Devry University 9/11/2014 HFCS was first introduced by Richard O. Marshall and Earl R. Kooi in 1957. They were, however, unsuccessful in making it viable for mass production, primarily because the glucose-isomerizing activity they discovered required arsenate, which was highly toxic to humans. An industrially feasible glucose isomerase, which did not require arsenate ion for its catalytic activity, was first discovered by Dr. Kei Yamanaka, Kagawa University
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Running head: Cola Wars1 Coke and Pepsi in the Twenty-First Century University of Redlands Deborah Bedgood-Ealy Professor Richard Doyle March 12, 2015 Coca-Cola and Pepsi function in the soft drink industry as dominating players and have remained market leaders for a long time. The key competencies of Coke and Pepsi range from the product, supply chain and distribution, marketing and customer loyalty. Each of them has developed operating procedure. The supply chain
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1) Why, historically, has the soft drink industry been so profitable? According to Exhibit 3a, the operation profit margin of the two giants kept robust growing from ~10% in 1970s to ~20% in 2005. That probably resulted from two reasons: 1) net sales enjoyed robust growth; 2) COGS and other expenses cowered fast. Net sales enjoyed robust growth. According to Exhibit 1, consumption per capita increased by 3% per year lasting for 3 decades since 1970s, due to A. Increasing demands of CSD and
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and reproductive systems, birth defects, and severe disruption of the immune system.4 In reaction to this report, the Indian government banned Coke and Pepsi products in Parliament and state governments launched independent investigations, sending soft drink samples to labs for testing. The Coca-Cola Bottling Company (Coke) stock dipped by five dollars on the New York Stock Exchange from $55 to $50 in the six sessions following the August 5 disclosure, as did shares of Coca-Cola
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RISK OF ENTRY Several factors contribute to the risk of entry into the carbonated soft drink (CSD) industry. Although profitable for existing concentrate manufacturers, the carbonated soft drink industry has a low risk of entry. The investment required to achieve competitive economies of scale increases the risk of entry into the market. Investments in capital to furnish the manufacturing plant are relatively low; however, the majority of the expense is in marketing, promotion, advertising, market
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