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Unformatted text preview: Cola Wars Continue:
Coke and Pepsi in 2006
We are fixing the seating chart today. Please
pick your seat for the rest of the semester.
Please have your name cards out…
Team lists due today. Case Questions
Case Why is the soft-drink industry so profitable?
How has the competition between Coke and Pepsi
affected the industry’s profits?
Compare the economics of the concentrate
business to the bottling business. Why are the
differences in profitability so stark? What is
causing concentrate producers to integrate
vertically into bottling?
Will Coke and Pepsi sustain their profits? What
would you recommend to Coke to ensure success
in the future? To Pepsi?
in Coke vs. Pepsi - Updates
Coke Coke 2007: $29 billion sales, annual growth 19%
Pepsi 2007: $39 billion sales , annual growth 12%
In 2008, Cadbury spun off its North American
beverage operations as Dr. Pepper Snapple Group.
beverage Coke vs. Pepsi – Final words
Coke Role of competition in influencing industry structure Price competition in duopoly vs. fragmented industries
Competitive convergence Role of company in influencing industry structure Coke and Pepsi managed industry structure by changing size and
division of the pie
Investments in brand image
Investments created barriers to entry
increased size of and distribution of the pie They also managed bottlers to keep their power low Industry structures are not static Big change may be imminent ...
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This document was uploaded on 11/04/2011 for the course BUSI 471 at UNC.
- Fall '10