Product differentiation of coca cola and pepsi

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Product differentiation of coca cola and pepsi

A sustainable competitive advantage helps brands get ahead of the competition and operate profitably. Coca Cola is a global brand that is found in almost all the corners of the world.

Its closest rival is Pepsi. These strategies are — cost leadership, differentiation and focus. These strategies can help a brand build a competitive advantage and overcome competitive pressure. This is a discussion of the generic and intensive strategy that Coca Cola has used to build sustainable competitive advantage and grow its market presence globally.

The main generic strategy used by Coca Cola is that of cost leadership. Everyone wants to spend less on any product. Coca Cola has kept the prices of its products low. These are affordable products and available easily in every corner of the world. Coca Cola has ensured both affordability and accessibility which has led to both higher sales and popularity.

This has proved to be a source of sustainable competitive advantage for Coca Cola. From time to time, Coca Cola also uses discounts and promotional campaigns to increase sales and popularity. It is mainly for the affordability of its products however, that the sales of the brand and its products have remained high.

Thus, the benefits of cost leadership are clear. It helps achieve higher sales, build a large customer base and also gain recognition. While cost leadership is the main generic strategy sued by Coca Cola, it has also used differentiation to gain an advantage over the competitors.

It has introduced a number of healthy products including health drinks and juices that are aimed at the health conscious customers.

Product differentiation of coca cola and pepsi

They are — market penetration, market development, product development and diversification. It is one of the key strategies Coca Cola has used to grow its sales.

Apart from keeping prices affordably low, the brand also uses promotional tactics like seasonal discounts to push sales among its existing customers.

This is the strategy of entering new markets or regions and selling to new customers. It is another key strategy that has helped Coca Cola become a global brand. Coca Cola products are sold in more than countries.

The brand has spread globally to nearly every corner of the world. Apart from the flavor of the coca cola products and there affordable rices, the credit also goes to the use of marketing and promotions for international growth. Product development is the strategy of bringing more products to the market to increase sales and revenue.

Overtime, the product array of Coca Cola has grown quite broad. Now, there are 21 billion dollar brands in its portfolio.

In this way, Coca Cola has achieved a lot of growth through product development. Its global growth story is a testimony of its use of generic and intensive strategies.However, until recently, the market share for Coca-cola and Pepsi has heavily favoured Coca-cola in Australia. It is estimated that Coca-Cola outsells Pepsi Cola by around three times in Australia and New Zealand supermarkets, and around five to six times in the whole cola market.

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For example Coca-Cola and Pepsi, two similar companies competing for the same market can employ these strategies to outdo each other. Differentiation is a marketing strategy where a company produces goods that are different from those offered by other companies.

In this, the firm offers niche buyers something different from rivals. Here, the firm seeks differentiation in its target segment.

Differentiation focus exploits the special needs of buyers in specified segments.

Competitors and their Marketing Strategies (With Diagram)

In this way, Coca Cola has achieved a lot of growth through product development. This was a discussion of the generic and intensive strategies that Coca Cola has used to grow its brand and earn a .

Product differentiation of coca cola and pepsi

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