Case Study : Soft Drinks COCA-COLA VS PEPSI HALDEBIQUE Geoffroy ROYER Johan

What do you know about Coca-Cola and Pepsi ? Coca-Cola, or Pepsi ?

Which one has the biggest ? PepsiCo has the highest revenue, with 65,5 billon dollars a year (48 for The Coca-Cola Company). The Coca-Cola Company has the largest net income, with 6,7 billion dollars (vs 6,55 billion dollars). Both are losing to Nestlé, dominating the food industry with a revenue of over 90 billion dollars and a net income over 10 billion dollars.

Concerning soft drinks The Coca-Cola Company only produces soft drinks and alcohol. PepsiCo also sells crisps (Lay’s and Benenuts). The product Coca-Cola and its derivatives represent 80% of the company’s revenue. Coca-Cola is still way ahead Pepsi-Cola in terms of market share.

Advertising campaings Coca-Cola’s ads aim at increasing brand awareness… http://www.youtube.com/watch?v=iX2xS9vPQ-Y#t=0m14s/ Whereas Pepsi’s ads target Coca-Cola specifically ! http://www.youtube.com/watch?v=LVyzUe_U0Jg#t=2m41

The Coca-Cola Company : SWOT Analysis Strengths Weaknesses Very strong brand image Numerous brand failures (dogs) Already existing market share Negative publicity Value of the company Undiversified activities Distribution channels High debt

The Coca-Cola Company : SWOT Analysis Opportunities Threats Bottled water consumption is increasing Health awareness Growing consumption and opportunities in BRIC Water scarcity & cost Growth of the company through acquisitions Hard competition from PepsiCo in BRIC

PepsiCo : SWOT Analysis Strengths Weaknesses Huge product diversity Low pricing Successful mergers and acquisitions of products Weak brand awareness compared to Coca-Cola Successful marketing campaigns Low net profit margin (9,7% compared to 18,55%)

PepsiCo : SWOT Analysis Opportunities Threats Bottled water consumption is increasing Health awareness Growing market in BRIC Decreasing gross profit margin Snacks consumption is increasing too Strong dollar

Coca-Cola Versus PepsiCo : The 4 P’s PRODUCTS : The Coca-Cola recipe Most of the products are soft drinks There are a lot of innovations… But most of products are brought in the market just for the sake of competition Coca-Cola has more products than PepsiCo (considering soft drinks only)

Coca-Cola Versus PepsiCo : The 4 P’s PRICE : Coca-Cola was ruling the market before PepsiCo’s arrival Now both companies are adjusting their prices on the basis of competition Pepsi is renowed to bring the price down to half, although they have a decent margin

Coca-Cola Versus PepsiCo : The 4 P’s PLACE : The whole world, for both of them (visible on the Coca-Cola Company website or with PepsiCo’s ads PROMOTION : Blind taste test film More ads on Pepsi-Cola than Coca-Cola, but Coca-Cola has a lot more programs (Sprite, etc.) Both are featuring celebrities in their ads

E-commerce objective and challenge Pepsi-Cola and Coca-Cola are already famous and a have lot of consumers. In a BCG Matrix they would be… They don’t have to present their product Just to keep people entertained!

Website presentation Let’s check Pepsi’s Website ! http://www.pepsi.com/en-us/d Very thumbs friendly Pop music topics Geolocation Consumer generated

Social networks Here are some figures : Coca-Cola has several Twitter accounts More than 2,32 million followers on the main account !

On Youtube COCA-COLA PEPSI 223k subscribers 689k subscribers 237M views 162M views Several videos a day Several videos a week

The Super Bowl 2014 A Polemic around a single ad http://www.youtube.com/watch?v=443Vy3I0gJs Extremely strong reactions to this ad

The Super Bowl 2014 What do YOU think about this ad ? What impact do you think it will have on Coca-Cola ?

THANK YOU VERY MUCH FOR YOUR ATTENTION ! ANY QUESTIONS ?