Wednesday, December 22, 2010

Marketing Warfare - Coca Cola and Pepsi

Pepsi used the concept of Megamarketing, a startegy that enabled a corporate to gain the cooperation of number of parties(usually govt functions, media and other pressure groups) to enter into or operate into the developing market. In crux, to offers freebies to find an entrance into the Profit Zone is called as Mega- marketing.

Coca cola rejuvinates its campaign and focussed its intentions on Indian Rural Market and augumented its thinking by introducing the ads such as Thanda Matlab CocaCola on the same lines as Unilever did on different occasions.

For both the companies, I would like to quote from Business India
"Both companies did not really concentrate on the fundamentals of marketing like building strong brand equity in the market, and thus had to resort to such tactics to garner market shares in india" Business India 2004
In the early 1970s, the US soft-drinks market was on the verge of maturity, and as the major players, Coke and Pepsi offered products that 'looked the same and tasted the same,'substantial market share growth seemed unlikely. However, Coke and Pepsi kept rejuvenating the market through product modifications and pricing/promotion/distribution tactics

The Modus operandi and the way they work remain the same and therefore thus both the companies resort to the competitive strategies in india.When Coca- Cola  introduced Mazza in  India; Pepsi correspondingly introduced Slice in the market.In essence, the companies were trying to increase the whole market pie, as the market-shares war seemed to get nowhere. This was because both the companies came out with contradictory market share figures as per surveys conducted by their respective agencies - ORG (Coke) and IMRB (Pepsi). For instance, in August 2000, Pepsi claimed to have increased its market share for the first five months of calendar year 2000 to 49% from 47.3%, while Coke claimed to have increased its share in the market to 57%, in the same period, from 55%

Coke was born 11 years before Pepsi in 1887 and, a century later it still maintained its lead in the global cola market. Pepsi, having always been number two, kept trying harder and harder to beat Coke at its own game.
In this never-ending duel, there was always a new battlefront opening up somewhere. In India the battle was more intense, as India was one of the very few areas where Pepsi was the leader in the cola segment.
Coke re-entered India in 1993 and soon entered into a deal with Parle, which had a 60% market share in the soft drinks segment with its brands Limca, Thums Up and Gold Spot.
Following this, Coke turned into the absolute market leader overnight. The company also acquired Cadbury Schweppes'soft drink brands Crush, Canada Dry and Sport Cola in early 1999.

The race numero uno will continue in Indian soft drinks market.In history, however on three separate occasions between 1922 and 1933, the Coca-Cola Company was offered the opportunity to purchase the Pepsi-Cola company and it declined on each occasion.Overall, Coca-Cola continues to outsell Pepsi in almost all areas of the world. However, exceptions include India, Saudi Arabia ,Pakistan (Pepsi has been a dominant sponsor of the Pakistan cricket team since the 1990s);
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