Posted at 02.10.2018
Keywords: coca cola marketing failing, pepsi competitive position
Coca-cola may be considered to experienced one of the primary brand failures in all times, but its long standing up and arch rival Pepsi, also acquired its relative show of marketing mishaps. Consider the case in 1992, when Pepsi spotted what it possessed considered as a significant gap in the market. After a few months of experiments, checks and research the business had came with a new and clear solution and further decided to call it as Crystal Pepsi. The company also arrived with an eating plan version of Pepsi, and called it an eating plan crystal Pepsi. Based on the company, both the products answered the buyer demand for purity.
The primary problem experienced by the merchandise was its tastes. The product was under the brand of Pepsi and appropriately, it was likely to flavour well. But no one was actually apprehensive of what it tasted like. Moreover, there has been many more marketing issues experienced by Pepsi and Coca cola over the years.
The major marketing obstacle for both Pepsi and Coca-Cola had been in differentiating their brand identification from one another. Pepsi was the major company to handle this challenge. As Pepsi wasn't the first company joining the cola market segment, the company's name was never considered to as a general name. However, this situation could have been prevented, but Pepsi's branding over the past years failed towards giving its product its entity, or a stand-alone identification in specific. The company breached 'the rules of color', which is recognized as one of the 22 immutable laws and regulations in Branding. Coca-Cola possessed a reddish-brown water so accordingly the color of cola brand is red. But Pepsi faltered in choosing the perfect color for its brand. There should have been powerful logic in selecting the colour that was complete opposite compared to that of major competition. The ccompany made an unhealthy choice. It had picked red and blue as its brand's colors. Red symbolized cola and blue symbolized the differentiation of the brand from its major rival Coca-Cola. For many years, the company experienced struggled by getting less than ideal response compared to the Coca-Cola's color strategy.
Coca-Cola's brand profile through the years consisted of Central US Brands primarily attributed to Coca-Cola, Diet Coke, Dasani, Minute Maid, Powerade, Sprite and Fanta. The brand extensions of Coca-Cola are Vanilla Coke, Cherry Coke and Coke with Lime and the International Brands of Coca-Cola consistes of Sprite Snow, Crush Sarsi and Qoo. Taking about Pepsi, its product profile contains Frito-Lay, Pepsi, Quaker plus some International products.
Coca-Cola's advertising centered majorly on redefining of the Coca-Cola, replenishment, Rejuvenation and refreshment from the drink and Health insurance and Nutrition from some of its drinks like fruit drinks etc. On the other hand, Pepsi's advertising centered on Slandering Coca-cola, Junior and a particular market segment for a particular drink. Despite successful launches and marketing, both companies have been slipping in the scrutiny of certain issues particulary medical issues regarding the refreshments arising majorly in Asian and U. S market.
The major strengths of Coke have been that almost all of its brands enjoy a high-profile of global occurrence. Also, four of the leading five brands are of Coca-Cola and the company contributed for 47% of the global amounts of sales in carbonates. The major talents of Pepsi have been that it has the world's second greatest best selling carbonate soft drinks brand. The company also enjoys a high profile global occurrence and has made a continuous effort for product development. Pepsi has always involved in ambitious marketing strategies relating famous superstars along its extensive collection of products.
Successful product launches, maintenance of brand image, working with medical issues and intense marketing would be the primary factors that could determine the continuing future of these businesses. Also for future years there are a few lessons that require to be discovered from the sooner brand failures of Pepsi and Coca-Cola.
Firstly, both the companies shouldn't assume that the spaces should be stuffed. If a opening is spotted in the market, it does not always means that it ought to be filled. Secondly, both companies need to understand that a failed product needs never to be re-launched. For e. g. for Pepsi when Crystal once failed, the company still thought in the philosophy that the planet was crying for a specific cola. The start of the second version made things even worse and the merchandise failed even terribly. Thirdly, the best strategy says, an organization needs to identify itself from its major competitor. So both company's should target differentiate themselves from each other. This would apply majorly to Pepsi for the years its visually identity had been diluted using its red & blue branding.
This tool have been a very simple yet powerful tool towards understanding the awareness of vitality in a business situation. The porter's 5 makes have always helped companies in the past and is likely to perform the same role for the future.
The tools is very useful, majorly because it helps the business's understand the effectiveness of both their current competition position and the as the positioning they want to move in the near future. In another words, it asses the firms competitive scenario and understands the expected future position. Both the company's should use Porter's five makes as their main tool for the future. The variables that both Pepsi and Coca-Cola must concentrate are
Power in hands of the supplier
Power in hands of the buyer
Major competitive rivalry
Threats of substitution
Lastly, dangers of new entrants
To gain a competitive more powerful position in the foreseeable future and also to get ahead of the other major, both companies also need to concentrate of good product combination, appropriate market segmentation, maintenance of brand images, proper distribution channels, ambitious marketing techniques combined with the use of Porter's five pushes.