Introduction
The history of Coca-Cola, a company with a big name, began with the invention of headache syrup based on: sugar, water, caffeine, extracts from coca leaves, and cola nuts. In 1886, in Atlanta, a medicinal decoction was brewed at home, which was supposed to bring cheerfulness and neutralize Migraines. Doctor John Stith Pemberton started selling his drink through a pharmacy. The trademark “Coca-Cola” was registered in 1893, at the same time, a company was founded with the name The Coca-Cola Company (Zhang, 2019). Candler did it, and he is considered the father of the company, while Pemberton is the creator of the drink. The history of Coca-Cola, a world-renowned company, has developed effectively due to several aspects. Here, a great influence is exerted not only by the high taste properties of the effervescent drink but also by an exclusive approach (Zhang, 2019). One of the reasons these brands are struggling is that they are both very strong, spread all over the world, and have excellent marketing and sales policies.
Discussion
As a result, the maximum share of the world market belongs to these two brands, and – in almost any country. The Coca-Cola vs Pepsi conflict is a unique century–old struggle that continues to this day. At the same time, there will always be connoisseurs who distinguish drinks from each other. Fans of Cola and Pepsi themselves are interested in watching the unfolding advertising campaigns. (Zhang, 2019). The company’s shares have fallen from $80 to $53 apiece over the past six years. Despite the fact that the word “cola” is recognized as common, fans have divided the names into Cola and Pepsi for themselves. This made it easier to distinguish drinks and contributed to the disappearance of this postscript from the blue cans.
Pepsi marketers really, as they say in advertising, direct their efforts to attract young people. This is evidenced by frequent advertising moves, official and not confirmed by anything. You can find an advertisement where a Coke machine is covered in snow, and Pepsi is standing quietly and waiting for customers. There is also an advertisement where a path is trodden to the blue drink, but there is not a single trace of the competitor. And these are the most harmless options. Funny and provocative posters and videos amused fans of both drinks and added points to the Pepsi basket. But Cola steadfastly held on, continuing to bend its line of a calmer and more traditional drink. These interesting advertisements not only at Christmas allow her to stay afloat and be a sales leader to this day. As of 2010, the company’s value was estimated at $70 billion (Zhang, 2019). Pepsi has a slightly lower amount, but they don’t give up. Let’s not dissemble, Cola has always been the first, and it does not give up its place to this day.
Competitive Environment
For more than a century, Coca-Cola and Pepsi have been fighting not to the death but to life for the title of the most popular soft drink in the world. It is difficult to bring the relationship between them under such a banal category as competition – this is a really fierce battle in the name of increasing market share and dividends. Why is Coca-Cola bypassing its competitors in all respects? The most interesting thing in this story of the rivalry between the two drinks is that there is practically no difference in the quality and taste of drinks between Coca-Cola and Pepsi. However, it is Coca-Cola that is in branded refrigerators in every cafe, restaurant, bar, and supermarket. Historically, Coca-Cola appeared 12 years earlier than Pepsi in the trade – this is a decent period. Because of this, it was the first to release the drink and staked out a market niche for itself (Zhang, 2019). The name Pepsi soda was received in 1902 when sales from the market already amounted to 120 thousand dollars.
In general, Pepsi has the unenviable role of the second, who is always chasing the leader but never gets close to him. A priori, becoming a catch-up, Pepsi openly copied Coca-Cola and promoted it to the market as a drink similar to Cola. Another reason for Cola’s victory over Pepsi is that it is the most recognizable brand. It turned out that the recognition of Coca-Cola in the world is 98 percent, that is, almost every person on Earth knows what Cola is. If Pepsi often changes its slogans and marketing moves, then Coca-Cola is constancy itself, already this does not allow consumers to feel that they are getting old and lagging behind in life.
In order to catch up with the leader and fight with him for the consumer, brand No. 2 is simply obliged to attack brand No. 1, and create bright memorable commercials. And also to work against Coca-Cola in contrast (Michael, 2020). Here it would be appropriate to give the following example. Since Cola is consistently associated with Santa Claus among consumers, PepsiCo launched an advertisement “Summer is Pepsi time”. Since it was pointless to fight Coca-Cola on the territory it had captured (leadership, the older generation, family traditions, etc.), PepsiCo began to attack Cola from the flanks and take pressure. Alas, the fate of all alternative brands is to be cooler than the sales leader, subconsciously comparing yourself with him. To become the first, it makes no sense to catch up with what Pepsi has been trying to do for a hundred years. To do this, you just need to run in your direction to the field that your competitor did not occupy. It is pointless to imitate the inimitable. Pepsi is doing everything right in terms of “flank attacks” of classical marketing.
Pepsi, having once made a bet on the young and achieved an intermediate victory thanks to this, soon lost much of what it had gained. The fact is that the tastes of young people are known to be changeable and fickle. In addition, she is growing, which means that she is changing her youth preferences (Chali, 2019). So Pepsi has to look for new potential consumers every year, but it’s not easy to erase from people’s memories that Pepsi is a drink for young people. Practice shows that attempts to break consumer stereotypes are often doomed to failure. Coca-Cola, on the other hand, relies on values valued by existing groups. Therefore, it can be concluded that Coca-Cola is a leader and will succeed in the long run since it was founded much earlier than Pepsi and is the owner of the original idea of this drink.
Conclusion
In slow-cycle markets, firms tend to be able to maintain a competitive advantage for some period of time. In markets with a fast cycle, competition is significant because firms focus on creating a number of temporary competitive advantages (Michael, 2020). Consequently, it can be concluded that Coca-Cola has become popular in the market with a slow cycle of the company since it still retains its position as the most popular carbonated drink in the world. Thus, if the Coca-Cola company had developed in the market with a fast cycle, it would have had a quick but fleeting success. Coca-Cola has no temporary competitive advantages, as it is aimed at its own original idea and not at fighting with competitors.
Sources
Chali, G. A. 2019. Assessment of Marketing Mix Strategies of the Hawassa Millennium Pepsi-Cola Plant. International Journal of Research and Analytical, 37.
Michael A. Hitt. 2020. Strategic Management: Concepts and Cases: Competitiveness and Globalization. 13th ed. Cengage Learning.
Zhang, Z. 2019. Risk Analysis of Two Leader Drink Company: PepsiCo and Coca-Cola. Asian Business Research, 4(3), 42. Web.