Friday, December 7, 2012

Alright, who is the predominant in the social media world? (Coca-Cola vs Pepsi)

We’ve posted a detailed information about the strategy of Pepsi to attract youth people and social media activities for this target. There is a current research about social media effectiveness of Pepsi and Coca-Cola. In despite of market share and selling rates, Pepsi has an hegemony on social media attraction especially with Pepsi's new strategy which has been implemented since 2008. Indeed, "Coca-Cola has by far the higher number of Facebook likes, 51 million to Pepsi's 9 million. But if you look at other numbers, the situation is different and, if anything, Pepsi might be winning in the social media world."
That research by exact numbers:

Thursday, December 6, 2012

Logo evaluation: Coca-Cola vs. Pepsi


If you compare the logo evolution of Coca-Cola and Pepsi cola, you may find there was a big different in the strategy of two companies. Today, you may find the Coca-Cola logo of is amazingly similar to the logo they used 130 years ago when the first time it being introduced, and it is the same as it was in 1900s.

However, we can see there was a panty of changes in the logo of PepsiCo. They began to use blue color in its logo after 1950s.  And they even try to not include the company name “Pepsi” in the logo in recent year. It is not a surprise because Pepsi continuously focus on radical change and periodic reinvention.

It is important to realize here, Coca-Cola is relying on the tradition and loyalty of the company and its customers. So that it creates consistency and history necessity, while Pepsi has a rich tradition of keeping pace with the changing customers needs and providing new and trendy soft drinks.

Customer Insight of Coca-Cola


As a marketing analyst might say, even a big company, such as Coca-Cola, needs to differentiate its products. Coca launched “Coca light”, and successively introduced “Coca zero” to soft drink market. They are coming for woman and man respectively, as Coca light seems to be more diet with lower carbon tax, and Coca zero sounds cool and extreme simultaneously. However, according to its own marketing survey, the original favor is still the best hit.

Pepsi, the second share owner of soft drink market, knows that the golden rule to follow customers, that is, it started the Pepsi Refresh program to focus on the young group, which boosted to be one of the most potential customers in this market. Then, let’s change the slide to Coca Cola, how could it maintain the top place?! Coca Cola knows well about customers for sure. The image of Coca Cola is cool, and just good to drink. The advertisements are always catchy and creative, like the animation one with the polar bear and his friends drinking Coca Cola and dancing. And another, a king of a trial somewhere faraway, and he gave Coca Cola a try, and then he went excited and surprised to make some funny moves. They keep conveying the spirit of cool, nothing but cool.

Nobody would refuse to be one of the cool. So, they don’t need so-called customized products. They are willing to pay for a red-and-black drink, just for a cool shot inside and a cool style outside. 

Tuesday, December 4, 2012

Customer Insight of Pepsi in spite of Coca-Cola

If you compare Pepsi with Coca-Cola in terms of reaching exact customer, it’s not a false observation that Coca-Cola beats Pepsi. Sales rates and market shares also endorse this observation. PepsiCo, the 2nd biggest soft drink company on the world, have began to create a new strategy in 2008 that the strategy is to attempt to reach youth market. Jill Beraud, who is Pepsi CMO, says in an interview that “Pepsi has, and always will, embody and fuel the spirit and optimism of youth”. For this aim, they have implemented a project named as Pepsi Refresh with a new Pepsi logo. In this project, the brand image has improved by social media connections and they have begun to get involved youth events as a sponsorship. The project website was refresheverything.com. You can check the website to see how they can manage youth events and strategies for youth people on their website. That website is now the official website of Pepsi. It means that the strategy is related with whole brand.

Product Touch Point and Differentiation


Widely-recognized, Coca-Cola and Pepsi are the two most popular beverage brands in the world. Within the lineup of beverages, their well-known predominant beverages are Pepsi-Cola and Cola Classic, the carbonated cola. Over the century, Coke and Pepsi have been at each other's throats in a constant strive for a bigger piece of the billion-dollar soda market. Although when compared in double blind taste tests, the majority of people could not tell the difference in taste, people will swear they love one or the other.

According to Interbrand's annual report, Coca-Cola is a more valuable brand than Pepsi. The reason is because brand image of Coca Cola is more deeply-rooted than Pepsi's. Both drinks are no longer seen as a beverage but primarily as a brand. Both companies oblige greatly to sponsoring outdoor music festivals and are even charitable

By appealing to pop culture, Pepsi tries to target on the younger generation. Their website is consisted flashy pages containing pop music, cars, and fashion. Even though, Coca-Cola's website also has links for music and sports, two arenas in which soda-pop is often consumed; but due to its long history as the standard for cola beverages, Coca-Cola's is less flashy and uses a classical appeal.

While Pepsi had Britney Spears, Keshauntae Brown, Michael Jackson, and Mariah Carey, Coca-Cola had Christina Aguilera featured in their commercials. Furthermore, while Pepsi with its younger audience tends to focus only on pop stars, it was Coca-Cola who is regarded as having one of the greatest TV advertisements of all time, featuring a far more mature pop band Blondie and the enormous hit "Atomic", the video played the main chorus of the song to the backdrop of professional footballers taking part in genuine competitive World Cup games and the noise a contender for the coveted title of Greatest Commercial of All Time in many nations.

Over the past several years, the brand at the top of the list of Interbrand's annual report has been Coca-Cola. That's not surprising, given the amount of effort and money the company put into creating their brand.
Surprisingly, spending just about as much money on branding as Coke and sell just about as much product. Pepsi comes in as the 26th most valuable brand in the world.
The important factors which indicated these circumstance is the difference of their brand's essence.

In other words, the brand essence for Coca-Cola has to do with things Americans hold close to their hearts, for example, people will think of America, Santa Clause, Polar Bears, World War II, History, and Family when they think of Coca Cola. Coca-Cola has a brand appeal that taps into some of the most deeply-ingrained emotions.

And for Pepsi, their brand essence isn't as deeply-rooted as Coca-Cola's. It's based on what's new, what's hot and what's trendy such as Britney Spears, Michael Jackson, Youth, The Choice of a New Generation, Cool, and Fun.

This happened because several decades ago, Pepsi decided to focus on the youth market since adults' brand loyalty for Coca-Cola was too well-entrenched to change their preferences. The company would like to spend their time, money and energy appealing to a younger market who, eventually, would replace the more mature Coke drinkers.
The problem was that by focusing on youth, Coca-Cola still keeps the brand values it already had. And those brand values are things that are deeply rooted in the American being. On the contrary, Pepsi has won abundantly of battles and has been keeping The Coca-Cola Company on its toes for decades. What Pepsi did with Gatorade, Aquafina and the non-carbonated beverage category are some of the examples.


U.S. Consumption of carbonated soft drinks has steadily declined in the past decade.
Part of that comes down to the range of other beverages the market now offers. Part of it comes down to health concerns in a nation with an obesity problem.

As a result, in the past few years, Pepsi comes up with their new strategy which they are focus more on the health-concerned product such as water, juices, teas and sports drinks.
Pepsi’s brands in those areas consist of Aquafina and Gatorade. And while it traces in soft drink sales, it leads the world in ready-to-drink teas through Lipton, though its Tropicana succeed in juices nectars.

The company is betting huge on creating healthy foods over its Quaker Oats, Gatorade and Tropicana divisions. And it just initiated the Global Nutrition Group to bring breakthrough products.

And also, Pepsi try to hired several well-known nutritionists to direct its efforts at reducing fat, sodium and sugar in its products.

In the meantime, Coca-Cola doesn’t seem to concern about what Pepsi has established. The company not only remains to focus on selling soft drinks worldwide, but even undertakes to rebuild Coke sales in the U.S. market. And undoubtedly, there was only 2% fall in Coke’s beverage volume in North America the year before. In 2009, it was tremendously tough economically on top of a relatively cool summer. In contrast, Pepsi’s beverage volume in the same region decreased 8%. While both brands have been declining, Pepsi is doing so at a slightly quicker rate.

As far as Pepsi is concerned, the cola wars are over. It now desires to focus on convincing investors that it has the right concentrate in this new strategy.

At present, the Global Nutrition Group is little but a nice marketing tool. It recently reduced the top end of its guidance for earnings growth. This may be because of increased investment in nutrition or due to a challenging, competitive global environment. Coke, among others, continues to giveaway market share from Pepsi. However, Pepsi had not neglected the company’s core business. Carbonated beverages still produce greatly of the company’s sales and for now, they’re still key to Pepsi’s upcoming health.


Monday, December 3, 2012

COCA COLA VS PEPSI


Coca Cola has been fighting against their main compeitor for many years. Pepsi was created in 1893. They have been competitors for more than 100 years.
When Pepsi got into this soft drinks markets, all their benefits where awfull because they bankrupt twice. After this occured the businnes started to be run by a Coca Cola distributor who finally sood up the other company.

Pepsi, as everyone knows , started with a very agressive actitude by increasing more quantity of the product and by reducing the price,compared with the coca cola one’s; The result was the sales increase.
In the other hand Coca Cola power dominated in EE.UU. Pepsi finally gained the same position as Coca Cola had. Changing their positioning was the key factor. They unificated the flavour and they started an agressive publicity strategy.
Pepsi marketing strategy was based on making differentiation between both brands trying to get closer to the young people section by identifying the brand Coca Cola with the traditional parents drink. This approach had a tremendous exit.
Now a days Coca Cola and Pepsi offer similar products, they attack mostly to one market section and they also want to get to the same range of people all around the world.


The Coca Cola Company succeded since the beginning because they used appropiate strategies as we said before. The brand development strategy of Coca Cola has been definied for a long term.
Loyalty of the brand is a very important factor to maintain their number one position. This loyalty was gained thanks to the useful and eficient strategies used by the members of the boards such as penetration strategy of the market, as the years passed Coca Cola provided many countries their products for example to South America, Asia, Africa…nearly all the world. Indeed, Coca Cola always conservate their main product as well as introducing new products but they have changed many times their packaging, drink tastes but they have never changed the logo since 1940, contrary Pepsi changed their logal frequently.


"Happiness" - customer insight of which brand?

Many brands have been using the word "Happiness" to reach consumers as a insight strategy. However, one of them has strong relationship with this basic word. All people who have drunk a coke even one time know that customer insight of Coca Cola is happiness. There is a great example of this insight to create a marketing method.


Product and the Purchase Constraint

Affected on the product and purchase.

The range of product is wide because all companies need high market share.The customers are involved highly in the product due to a high investment in marketing in order to build the relationship with customer in the long-term. So there are lots of customers that are addicted to the brand, but some still consider only the price especially between coca-cola and PepsiCo due to the almost same quality. Because of the health concern, people drink this kind of drink less frequency and begin to drink substituted product like juice and energy drink.




Key Success Factors



These are key characteristics of Soft Drink Market.


1. Size of the organization enable the company to negotiate the exclusive supplier for a specified period of time and purchases in a large quantity that dramatically lower their costs.  Large organization can have  effective distribution channels to make the business more  competitive.  
This factor make the company in industry diversify a lot to gain market share. Merger and consolidation has been needed in the soft drinks to increase the economies of scale; for example, PepsiCo acquired Quaker Oats, who bought Gatorade which will help increase its market share.

2. Brand loyalty is a big isssue of the soft drink industry.  Many consumers of carbonated beverages buy only a particular brand, and hardly purchase others.  This characteristic make brand image important. Every company spends a lot on marketing and advertising in order to create emotional relationship between brand and customer.

3. Price is also a key factor because consumers who has not preferred in a strong brand will select the product with the most competitive price. This factor makes branding more important. If the company can build relationship between the brand and customer, the company will get the competitive advantage because the customer will look for the brand, not the cheapest price. The company can increase the price for its branding to have higher revenue.

4. Global expansion is a important factor in the success of a company within this  industry.  Due to American market saturation, Movement into the global industry is required in order to maintain growth. This characteristics cause the company to find new market, like China which has the greatest number of population in the world. The companies invest highly in the infrastructure and the marketing in order to build brand loyalty in this large group of consumer.

5. High capital investment for warehouses, trucks, and labor, and economies of scale is a great barrier for new entrants . This factor limits the number of competitor in this industry, so, there is just Coca-Cola and PepsiCo which are the main leader. Thus, these two companies compete each other for a long time, and try to come up with a campaign that will beat its main rival. 

6. Product Innovation is also the important factor. The company should come up with the differentiated product which can respond the need of consumer. There is a lot of brand extension, such as coke cherry. The companies try to invest in a new product that can respond their customer’s need in that period. But some new product can hurt a lot their brand image, such as new coke.

7. Health Issue is also the key factor that affect the consumption of Soft drink. Manufacture in a range of flavors and marketed to both children and adults, soft drinks have been widespread in American society for decades. While the drinks may prove refreshing and palatable, the sugar and other chemicals found in many soft drinks can prove detrimental to your health.

Ingredients contained in many soft drinks are themselves sources of concern, for example, caffeine, when consumed in excess, is lead to the sleep disruption and anxiety, and some critics question the health effects of added sugars and artificial sweeteners. According to the researched from University of Sheffield, Sodium benzoate has been inspected as a possible reason of DNA damage and hyperactivity. Other substances have negative health effects, but are present in such small quantities that they are unlikely to pose any substantial health risk provided that the beverages are consumed only in moderation.

Obesity

The consumption of sugar-sweetened beverages is associated with weight and obesity. Weight gain and obesity develop owing to chronic overconsumption of calories, causing your body to store the excess energy as fat. While overconsuming any type of food can cause weight gain, soft drinks can easily add hundreds of calories to your daily caloric intake, facilitating weight gain. The consumption of sugar-sweetened soft drinks can also be associated with many weight-related diseases, including diabetes, metabolic syndrome and cardiovascular risk factors, and elevated blood pressure.


Bone Loss

According to the researches and studies, drinking soda correlates with a decrease in milk consumption along with the vitamin D, vitamin B6, vitamin B12, calcium, protein and other micronutrients. Phosphorus, a micronutrient, can be found in cola-type beverages, unfortunately there may be a risk in overconsumption.Phosphorus and calcium are used in the body to create calcium-phosphate, the main component of bone. However, the combination of too much phosphorus along with too little calcium in the body brings a degeneration of bone mass.

Tooth Decay

One major health problem assorted with drinking soft drinks is progressive tooth decay. Most soft drinks contain high concentration of simple carbohydrates: glucose, fructose, sucrose and other simple sugars. Your teeth, similar to bone, contain mineralized tissue that begins to dissolve after exposure to acid. Bacteria in your mouth feed on the sugars within soft drinks, and release tooth-dissolving acid as a byproduct of sugar metabolism, according to Elmhurst College.
All companies realize this problem and try to launch new brand in the new market to catch up the trend; for example, Coke launched Minute made, while PepsiCo launched Tropicana. Both are in juice market.


Source : http://www.csbsju.edu/documents/libraries/zeigler_paper.pdf
http://www.livestrong.com/article/402079-health-problems-and-soft-drinks/#ixzz2CUCjMkYL
http://en.wikipedia.org/wiki/Soft_drink
http://www.ifood.tv/blog/how-do-soft-drinks-affect-your-exercise
http://thesodasite.com/wp-content/uploads/2012/09/

Sunday, December 2, 2012

Soft Drinks Industry Profile

Companies in this industry produce soft drinks, bottled water, and other nonalcoholic beverages. Major companies are Britvic (UK), Coca-Cola (US), Cott (Canada), Dr Pepper Snapple Group (US), Nestlé (Switzerland), PepsiCo (US), and Red Bull (Austria).But the two main players on the global soft drink market are Coca-Cola, which has 25 brands and 133 varieties, and PepsiCo that has 17 brands and 161 varieties.

Soft drink industry Structure (2008)



The war between Coke and Pepsi still continues, but currently Coke has the top spot.

Top 10 Soft Drinks

2011
1.
Coca-cola Classic (coca-cola)
2.
Diet Coke (coca-cola)
3.
Pepsi-cola (PepsiCo0029
4.
Mountain Dew (PepsiCo)
5.
Dr Pepper (Dr. Pepper/Snapple)
6.
Sprite (coca-cola)
7.
Diet Pepsi (PepsiCo)
8.
Diet Mountain Dew (PepsiCo)
9.
Diet Dr. Pepper (Dr. Pepper/Snapple)
10.
Fanta (coca-cola)


Source : https://www.msu.edu/~howardp./softdrinks.html
http://www.energyfiend.com/top-10-soft-drinks
http://www.firstresearch.com/industry-research/Nonalcoholic-Beverage-Manufacturing.html


Key Market Products

1. Carbonated, or sparkling drinks, are expected to create revenues more than $209 billion in 2014, reported by MarketLine. Coca-Cola is the market’s leader company. Other big firms on the market include: Red Bull, Dr Pepper Snapple and PepsiCo. Key growth challenges are consumer consumption and health concerns.

2. Sports drinks, energy drinks, and nutraceutical drinks, is expected to exceed $62,000 million in 2015, according to MarketLine. In this segment, PepsiCo is the number one company . Sports drinks’ market grows well with steady consumption, while energy drinks is a rapidly growing market because consumers show greater awareness on health issue and need the drink that is beneficial for their health.

3. Bottled water market is expected to be more than $126 billion in 2015, reports MarketLine. This represents 27% market expansion in five years. Danone is leaded in this segment. Health awareness, higher consumer consumption, enlarged population and lifestyle trends are key market drivers, which leads to product innovation, and packaging.

 4. The worldwide juice market, which includes fruit and vegetable juice, nectars, and fruit drinks, will exceed 64 billion liters by 2015, according to Global Industry Analysts. Consumers turn to consume in this kind of product more than the previous period due to awareness of health and nutrition.


Products
Expected production in 5 years
Leader
Leading Product in each segment
Carbonated, or sparkling drinks
  10% rise
Coca-Cola with  42 % stake
40 % Carbonated drinks
Sports drinks, energy drinks, and nutraceutical drinks
30% rise
PepsiCo with 24 %  stake
58 % Energy Drink
Bottled water
20% rise
Danone with   14% stake
65% Unflavored Water
Juice
2% rise
Cadbury, Tropicana, Minute Maid
100% Fruit Juice



Thursday, November 29, 2012

History of Soft Drink




          The first “soft drinks” came naturally from mineral waters found in natural springs and geysers. Early people would bathe in these natural springs due to the believe that mineral is good for their health. This concept leads to the development of soft drink .


John Matthews patented portable mineral-water makers that used pressurized tanks full of carbonic acid gas. These "soda fountains" were considered to be set up in drugstores where a pharmacist would mix the pressurized gas with water to make a drink that good for everybody’s health. By the early twentieth century, soda fountains would mix carbonic acid gas, water, and syrup to create sparkling water. Then, pharmacists were making different flavors and adding additives to make the drink better in terms of taste and health benefit. Caffeine, tobacco, cocaine, bitters, fruity flavors, and phosphate are popular addictive. When time fled, Soda fountain was very popular and moved from drugstore. Then the word “soft drink” replaced “soda”.

Many entrepreneurs create their business from this concept. Coca-Cola was sold in 1896 as a therapy for headaches. Then in 1903, Pepsi-Cola was established and its good was sold as a remedy for dyspepsia.

The soft drink was developed as a medical drink and until the last century it was marketed heavily. By the mid 1960s, people can buy sodas in bottle in the supermarket, and besides everybody was thinking that soda cannot help them intoxicated anymore. Nowadays, these once medicines became the tasty beverages.


Wednesday, November 28, 2012

What is SOFT DRINK? ..




          ..Soft drinks are typically carbonated, non-alcoholic beverages. The term "soft drink" specifies the absence of alcohol in contrast to "hard drink" which contained some hard liquor. Beverages such as soda pop, sparkling water, iced tea, lemonade, root beer, and fruit punch are the most common soft drinks. These types of drinks are normally sweet and may be served chilled or at room temperature.

A soft drink, may go by a variety of aliases including soda, pop, coke, soda pop, fizzy drink, tonic, seltzer,mineral, sparkling water or carbonated beverage, is a beverage that generally contains water, and usually a flavoring agent, and usually a sweetener which may sugar, fruit juice,high-fructose corn syrup, sugar substitutes (in the case of diet drinks) or a combination of these. Soft drinks also may hold caffeine, coloring  preservatives and other ingredients. They are widely sold in many flavors such as cola, cherry, lemon-lime, root beer, orange, grape,vanilla, ginger ale, fruit punch, and sparkling lemonade.