Pepsi Cola, a Global Leader in convenient foods and beverages. It was created two years behind Coca Cola, and the two have remained economic rivals since their creation. PepsiCo products are enjoyed by consumers one billion times a day in more than 200 countries and territories around the world (World Economic Forum).
Does the company have a comparative advantage over its rivals?
Pepsi is one of the largest international brand name beverage companies across the globe. They were created in a pharmacy like Coca-Cola just two short years behind them in New Bern, North Carolina (the birthplace of Pepsi-Cola) (Sievers, 2020). They were not considered a beverage rival until a few years later but that was short-lived, the Great Depression caused them to file bankruptcy twice (Sievers, 2020). Pepsi's number one rival is Coke. Both are well-known brand names, but Pepsi only dominates in North America vice Coke dominates globally. Pepsi has a strong brand equity position (Levin, 2022). In the past five years, Coke has gained 22.13% of market shares, while Pepsi has gained 49.20%. Pepsi also had a higher revenue at $65 billion, while Coke was at about half the amount with $32 billion (Sievers, 2020).
Explain the supply and demand for its key product or service.
There are several factors that affect the supply and demand of Pepsi-Cola as with any popular brand-named beverage such as the cost of the supplies (sugar, substitute sweeteners, bottling plant). There are several substitutes for off-brand beverages produced today but Pepsi and Coke are household brands with a large client base. With roots dating back to 1898, PepsiCo Beverages North America (PBNA) is one of the largest beverage companies in North America today, generating more than $22 billion in net revenue in 2020. that they will comparatively not outsell Coca-Cola. Pepsi has partnered with other local brands such as Frito lay
Provide the GDP of its home country and a key market (country).
The US is the largest economic country followed by Canada and Mexico (Statistics Times, 2021). North America where dominates the market with convenient foods and beverages. Despite being an international brand-named company, Coke does significantly better internationally with the many beverage choices that they provide.
How do fluctuations in GDP, economic growth, investments, and patents affect the company’s profitability?
Pepsi has introduced Pepsi+. They are investing in our future. The future of this planet and having a positive impact on communities. PepsiCo sources crops of over 7 million acres of farmland in 60 different countries (Laguarta, 2022). They are introducing more effective ways to be more environmentally safe while continuing to roll out their same quality products. Also, partnering with emerging brands in the fast-growing energy and value-added protein categories.
References
(n.d.). Retrieved from Peps-Cola Company: https://www.pepsico.com/who-we-are/about-pepsico
Laguarta, R. (2022). Pepsico. Retrieved from 2022 Sustainability Report: https://www.pepsico.com/our-impact/sustainability/sustainability-report
Levin. (2022, January 23). Wood Ward Avenue. Retrieved from What Gives Pepsi a Competitive Advantage: https://woodwardavenue.org/what-gives-pepsi-a-competitive-advantage/#7
Sievers, C. (2020, February 23). Pinckney Marketing. Retrieved from Pepsi or Coke? An In-Depth Look at Decades of Marketing Rivalry: https://pinckneymarketing.com/coke-vs-pepsi-rivalry/
Statistics Times. (2021, October 7). Retrieved from https://statisticstimes.com/economy/north-american-countries-by-gdp.php
Greetings Akuacia,
"Pepsi is such a great multinational company to research. I see some similarities with this company that I have in the company I chose to research which is Shell. One of the great advantages with pepsi is that they have an ambitious new goal to cut carbon emissions by more than 40 percent by 2030. This is more than doubling the objective they had for 2015. This is expected to result in the reduction of over 26 million metric tons of greenhouse gas emissions" (Streams, 2022).
Works Cited
World Economic Forum. 2022. Streams. [online] Available at: <https://www.weforum.org/partners/live-updates/week-ending-15-january#pepsico-ups-the-ante-on-climate-action> [Accessed 5 July 2022].
Hey Akuacla,
Thank you for your contributions on this blog. Global food and beverage leader PepsiCo has a diverse portfolio of well-known brands. According to a source, every day, people in more than 200 nations and territories across the globe consume one billion servings of PepsiCo products. Frito-Lay, Gatorade, Pepsi-Cola, Tropicana, Quaker, and Pepsi contributed around $63 billion in net sales for PepsiCo in 2016. There are 22 brands in PepsiCo's product portfolio that produce more than $1 billion in projected annual retail sales. An established position in the industry allows the organization to recruit and serve a wide range of customers.
References
PepsiCo Inc. Accessed July 2, 2022. https://search-ebscohost-com.ezproxy.regent.edu/login.aspx?direct=true&db=dmhls&AN=26FFE4D9-E51D-4F5B-AC02-76DC923525A7&site=bsi-live
Hey Akuacla,
While reading your post when it was talking about Global and International prowess, I can back up those facts with experience, having traveled most of Europe during my childhood, pepsi was not as big of a brand as coke was in the global markets. They use the idea of globalization marketing, an example being this, "This segment sought social bonding as marketing technique and used inspirational messages to celebrate social meetings. “Dayman Coca-Cola" which translates to “always Coca-Cola” in Arabic was a successful and relevant tagline for Coca-Cola." (Banutu-Gomez, 2012) References
Banutu-Gomez, M. B. (2012). Coca-Cola: International business strategy for globalization. The Business & Management Review, 3(1), 155.
Great post on Pepsi-Cola! It’s an interesting thing about Pepsi-Cola. While they have a large name in the international market, their focus seems to be on the US market. While Coca-Cola’s approach is to be the number one soft drink company in the world, Pepsi-Cola focuses on the US, making them the number one soft drink company in the United States. When traveling abroad, I often see Coca-Cola, not Pepsi. Why do you think Pepsi-Cola has focused on the United State’s market?
Akuacla,
I have enjoyed reading your blog milestone post this week. Coke and Pepsi have been rivals for years in the beverage industry. Both companies provide a variety of products to consumers. Coca-Cola and Pepsi both have trademark secrets that they must protect. If these secrets get into the wrong hands, it can be devastating to both companies. The secret formulas of Coke and Pepsi give them a trademark advantage over other companies. People will go to extremes to get the trademark secrets and try to sell them to competitors. Coke is Pepsi's biggest competitor. According to Goodman, on July 5, 2006, Federal agents arrested and charged an employee of the Coca-Cola Company and two others with stealing trade secrets and wire fraud, saying they tried to sell "highly classified" information to that company's competitor PepsiCo for $1.5 million (Goodman, 2006). Pepsi turned the information over to Coca-Cola instead of using it to their advantage.
Reference
Goodman, B. (2006, July 6). Agents arrest 3 in plot to sell Coca-Cola Secrets to Pepsico. The New York Times. Retrieved July 3, 2022, from https://www.nytimes.com/2006/07/06/business/06coke.html
Hi, and thank you for your organized post.
As Coke and Pepsi reign at the top of the soda beverage industry, it is no surprise that their companies follow similar business models. Companies like Coke and Pepsi share a similar customer avatar as they cater to a very similar market as top-tier business rivals. However, one of the most significant differences between the two companies is that Pepsi offers a wide variety of products that are produced within the company. Still, Coke provides a narrower, more focused product made. Coke specializes in soft drinks, whereas Pepsi has industry markets in not only soda but also prepacked snacks, sports drinks, pastries, and other consumable vending-styled foods (Forbes, 2022). As you had mentioned in your post, the numbers show that Pepsi has a significantly higher market share than coke; this is largely attributed to their contribution of products to the market. Despite growth in business between the two cola corporations, Coke is representative of the larger market presence (Gorton, 2022).
References:
Forbes. (2022). PepsiCo (PEP). Fobes. https://www.forbes.com/companies/pepsico/?sh=2cf6da0d4711
Gorton, D. (2022). Coca-Cola vs. Pepsi’s business models: What’s the difference? Investopedia. https://www.investopedia.com/articles/markets/081415/comparing-cocacola-and-pepsis-business-models.asp