37730043-Cola-Wars-Coke-vs-Pepsi

37730043-Cola-Wars-Coke-vs-Pepsi - Cola Wars: Coca-Cola vs....

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Cola Wars: Coca-Cola vs. PepsiCo By Manu Chauhan, WMP 6029 Mukul Priyadarshi, WMP 6030 Nikhil Nangia, WMP 6031 Nilanjan Sen, WMP 6032 Nitin Saxena, WMP 6033 Nitin Verma, WMP 6034 A project report submitted in fulfillment for Managerial Economics WMP 2010-13 Indian Institute of Management, Lucknow Noida Campus
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Date: 05-09-2010
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Table of Contents
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Introduction For over a century, Coca Cola and Pepsi vied for “throat Share” of the world’s beverage market. The most intense battles of cola wars were fought over the $60-billion industry in the United States, where the average American consumed 53 gallons of carbonated soft drinks (CSD) per year. In a “carefully waged competitive struggle”, from 1975 to 1995 both Coke and Pepsi achieved average annual growth of around 10% as both U.S and worldwide consumption consistently rose. According to Roger Enrice, former CEO of Pepsi-Cola: The warfare must be perceived as a continuing battle without blood. Without Coke, Pepsi would have a tough time being an original and lively competitor. The more successful they are, the sharper we have to be. If the Coca-Cola company didn’t exist, we’d pray for someone to invent them. And on the other side of fence, I’m sure the folks at Coke would say that nothing contributes as much to the present-day success of the Coca-Cola company than…. . Pepsi. This cozy relationship was threatened in the late 1990s, however,, when US CSD consumption dropped for two consecutive years and worldwide shipment slowed for with Coke and Pepsi. In response, both firms began to modify their bottling, pricing, and brand strategies. They also looked to emerging international markets to fuel growth and broadened their brand portfolios to include non-carbonated beverages like tea, juice, mineral water and sports drinks. As the cola wars continued into the twenty-first century, the cola giants faced new challenges: could they boost flagging domestic cola sales? Where could they find new revenue streams? Was their era of sustained growth and profitability coming to a close, or was this apparent slowdown just another blip in the course of Coke’s and Pepsi’s enviable performance?
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The Evolution of the Soft Drink Industry Early History Coca-Cola was formulated in 1886 by John Pemberton, a pharmacist in Atlanta, Georgia, who sold it at drug store fountains as a “potion for mental and physical disorders.” A few years later, Asa Candler acquired the formula, established a sales force, and began brand advertising of Coca-Cola. Candler granted Coca-Cola’s first bottling franchise in 1899 for a nominal one dollar, believing that the future of the drink rested with soda fountains. But the company’s bottling network grew quickly. Robert Woodruff, who became CEO in 1923, began working with franchised bottles to make
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37730043-Cola-Wars-Coke-vs-Pepsi - Cola Wars: Coca-Cola vs....

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