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Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War - Business - Nairaland

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Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by hayoakins(m): 8:55am On Mar 11, 2016


COMPETITORS ARE NOT ALWAYS RIGHT.

The business environment of the 21st century is quite dynamic and different from the preceding centuries when there existed little or no competition, a business environment that was mechanically managed with infrequent changes and a few competitive products for consumers to select from.

Customers are not always right, a classic example is Coca-Cola vs Pepsi extra 20% content market war. Coca-Cola deciding to follow the bandwagon could be a strategic suicide, competition is beyond increasing revenue by reducing the market share of other competitors, retaining shareholders’ confidence in the enterprise ability to innovatively compete is as important as dividend declaration.

Pepsi didn't rollout "Customized Pepsi" because Coca-Cola did, Pepsi got thinking and dared to increase its content, Coca-Cola could have done better thinking out another strategy, no brand has the monopoly of ideas (It would be insane to stick with a strategy already heading down south however the competitor has no monopoly of ideas if you have the right team), the brain is a powerful store house of ideas to those who know how to effectively and efficiently call it to duty. Coca-Cola should also value its reputation; goodwill is so expensive that when impaired, it may be gone forever. Copying and pasting competitor's strategy will never make you the first/best but a second best. Coca-Cola also increasing its content may only close up the gap in profit margin “if any” on the short-run but may renege on the long-run. Innovation & strategy influence share prices not just profit, strategy is however directly proportional to the rate of organisational performance.

Why not copy a winning strategy and save management time you may debate, one key we need to always remember is that originality has a value even time can't buy/afford. Coca-Cola may lose out on the long-run for this strategic blunder. Copying a strategy may be ethical but not in all industries, reason strategic innovations are usually protected in the Pharmaceutical industry for a number of years. I support flexibility of organizational structure and strategy 150% but not when cashing in on others' creativity and strategy at little or no cost. Coca-Cola didn't tweak, it COPIED. However, copying is allowed as long as we tweak & redefine.

The input of a management accountant could have been invaluable as pricing appeals more to consumers than quantity which is a validation of the existence of marginal utility (the more you consume, the less satisfied you become). The cost of producing bigger bottles and the extra 20% could have been giving to consumers as discount. A discounted price in form of promo would have been a unique strategy to increase the market share and give competitors a tough pill to swallow. I could only imagine how the demand for Coca-Cola would have headed up north if the retail price had gone down south to 80.00NGN or 90NGN.

The performance of a enterprise is the reflection of brains behind it. Lazy thinkers will eventually fail. Gone were the days when profit was the sole objective of corporate citizens, now it is creation of wealth for shareholders which only profit does not guarantee that. A profitable enterprise breaking and abusing industrial rules and regulations would soon be sent packing. Profit isn't enough. iPhone uses differentiation strategy while Techno Cost leadership, Should Infinix adopt iPhone's strategy, It'll be sorry because what works for your competitor may launch you in liquidation. COMPETITORS ARE NOT ALWAYS RIGHT.

Written by Ayobami Akinade

https://www./competitors-always-right-ayobami-akinade?published=u

Photoillustration by Matt Connolly.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by yomalex(m): 9:23am On Mar 11, 2016
Food for thought
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by debbie(f): 10:38am On Mar 11, 2016
Well, I think the genesis of the increase in content of both Pepsi and Coca-cola pet bottles is a reaction to the impressive entrance of a new brand "Big cola" into the carbonated soft drink market . The Big-cola brand entered the market with the Unique Selling Points of more quantity,less sugar and no caffeine for the same retail price of N100 per Pet bottle. It has surprisingly gained wide acceptance and patronage from customers in the Lagos metropolis for a new entrance in such a short period of time. Thus, the consequent drop in sales revenue of the known brands Pepsi and Coca-cola. So it is only competitive response that resulted in Pepsi now coming up the "Longer Throat bottle" theme to increase its content by 20% and regain its lost market share and Coca-cola followed suit by adding 10cl-free 20% as they put it- of content for the same price. Well, call it bandwagon effect but it is a marketing strategy that will try to regain its lost sales revenue to competition.
The same can be seen in the telecom industry where each competitor is adopting same marketing strategy with maybe a little modification to make it unique to its brand but targeted at keeping its market share in the keenly competitive atmosphere of "brand eat brand" business. Most popular example is the per second billing and its various prepaid tariffs packages,recharge bounces and promotions of all kinds. It is a known and effective business/marketing strategy to always let the customer see that s/he is getting something free in purchasing a product or service -extra value. This has a way of influencing customer to buy even what the don't need just because there is a freebie or "awoof" to be gotten. It has always worked in push sales; hence you see on most showroom glasses % Sales discounts more less as a permanent decoration.
But in all reality, the customer always pays for the seemingly freebie in the long run. So don't be deceived as a customer...the business must go on and profits must be made. Just play along and be psyched.

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Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by hayoakins(m): 11:25am On Mar 11, 2016
debbie:
Well, I think the genesis of the increase in content of both Pepsi and Coca-cola pet bottles is a reaction to the impressive entrance of a new brand "Big cola" into the carbonated soft drink market . The Big-cola brand entered the market with the Unique Selling Points of more quantity,less sugar and no caffeine for the same retail price of N100 per Pet bottle. It has surprisingly gained wide acceptance and patronage from customers in the Lagos metropolis for a new entrance in such a short period of time. Thus, the consequent drop in sales revenue of the known brands Pepsi and Coca-cola. So it is only competitive response that resulted in Pepsi now coming up the "Longer Throat bottle" theme to increase its content by 20% and regain its lost market share and Coca-cola followed suit by adding 10cl-free 20% as they put it- of content for the same price. Well, call it bandwagon effect but it is a marketing strategy that will try to regain its lost sales revenue to competition.
The same can be seen in the telecom industry where each competitor is adopting same marketing strategy with maybe a little modification to make it unique to its brand but targeted at keeping its market share in the keenly competitive atmosphere of "brand eat brand" business. Most popular example is the per second billing and its various prepaid tariffs packages,recharge bounces and promotions of all kinds. It is a known and effective business/marketing strategy to always let the customer see that s/he is getting something free in purchasing a product or service -extra value. This has a way of influencing customer to buy even what the don't need just because there is a freebie or "awoof" to be gotten. It has always worked in push sales; hence you see on most showroom glasses % Sales discounts more less as a permanent decoration.
But in all reality, the customer always pays for the seemingly freebie in the long run. So don't be deceived as a customer...the business must go on and profits must be made. Just play along and be psyched.

You could be right. The big Cola company has also introduced the orange variant to give Fanta a chase, i doubt if they saw that coming. There are several ways to protect and increase market share and also manage entry of new competitors. Coca-cola chose the easy way out at the expense of their goodwill of being a strategic brand by copying with no modifications. When telecos copy one another's template, they modify that laying claim to being copied would be a tall order. Coca-cola could have done better than copying a template wholly.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by ITSaWRAPPP: 12:26pm On Mar 11, 2016
When decisions are premised solely on profitability, the outcome may be disastrous. In the dynamic business environment of the 21st century, it takes more than profit to achieve going concern. Profit is not enough and indeed competitors are not always right.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by panacheinc7: 2:24pm On Mar 11, 2016
yomalex:
Food for thought

As posited, both are reacting to the loss of market share caused by the acceptance of Big Cola in trade. It's a war fought on two fronts: Price and quantity.

Also, there is nothing 'really' wrong with Coca Cola copying Pepsi. When a strategy that works is replicated in another organisation, it is termed as 'best practices'.

However, I think Coca Cola should have been smarter and take a detour. Why not fight on Price instead of quantity? The same 20% extra content could have been treated as 20% lesser price per unit at the old price. That would have been a killer move. Coke pet becomes N100 less 20% thats 80 bucks.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by hayoakins(m): 3:05pm On Mar 11, 2016
panacheinc7:


As posited, both are reacting to the loss of market share caused by the acceptance of Big Cola in trade. It's a war fought on two fronts: Price and quantity.

Also, there is nothing 'really' wrong with Coca Cola copying Pepsi. When a strategy that works is replicated in another organisation, it is termed as 'best practices'.

However, I think Coca Cola should have been smarter and take a detour. Why not fight on Price instead of quantity? The same 20% extra content could have been treated as 20% lesser price per unit at the old price. That would have been a killer move. Coke pet becomes N100 less 20% thats 80 bucks.

Atleast one person agrees that Coca-cola could have attacked using another and perhaps better strategy and not using the same weapon(strategy) used by the Pepsi. Most times, you may not be able to use a weapon better than the inventor.

Lalasticalala, Mynd44, which do you prefer, Coca-Cola or Pepsi?

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Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by dynamix101(m): 8:26pm On Mar 11, 2016
panacheinc7:


As posited, both are reacting to the loss of market share caused by the acceptance of Big Cola in trade. It's a war fought on two fronts: Price and quantity.

Also, there is nothing 'really' wrong with Coca Cola copying Pepsi. When a strategy that works is replicated in another organisation, it is termed as 'best practices'.

However, I think Coca Cola should have been smarter and take a detour. Why not fight on Price instead of quantity? The same 20% extra content could have been treated as 20% lesser price per unit at the old price. That would have been a killer move. Coke pet becomes N100 less 20% thats 80 bucks.

Smiles......U are a Nigerian and should know dat reducing the price tag will only butter-up the bottomline of the middlemen, cos in Nigeria, what goes up never comes down. We have seen many products with the SRP stamped, yet retailers will tell you dat that is the price they got it for.
At least, I am happy dat I can get my favorite Teem @ a better deal. To all these companies that flagrantly exploit us Nigerians, dia ris God o.....Very soon, 1ltr will go for N100; afterall, its sugar water.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by hayoakins(m): 11:53am On Mar 14, 2016
dynamix101:


Smiles......U are a Nigerian and should know dat reducing the price tag will only butter-up the bottomline of the middlemen, cos in Nigeria, what goes up never comes down. We have seen many products with the SRP stamped, yet retailers will tell you dat that is the price they got it for.
At least, I am happy dat I can get my favorite Teem @ a better deal. To all these companies that flagrantly exploit us Nigerians, dia ris God o.....Very soon, 1ltr will go for N100; afterall, its sugar water.

Not in all cases, any manufacturer can monitor her retail price if she is really keen on achieving the objective(s) of regularising the retail price.
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by oothoney: 2:43pm On Mar 14, 2016
Reducing price won't work..will only be beneficial to depot owners, wholesalers and retailers since they buy in bulk but not to the consumers as retailers will still retail at
=N= 100....sighting no change

Thereby making more money and consumers buying more of big cola or Pepsi...even if 80 is inscribed on d bottle or cork..retailers will keep shouting no change

Frm Guinness to Nigeria brewery. That method has never worked as retailers will always round to the nearest hundred except u have exact amount in hand.

What they did its still ok....at least to maintain there market share while they come up with another strategy
Re: Coca-cola Vs Pepsi Extra 20% Content and Big Cola Market War by dynamix101(m): 12:04pm On Mar 15, 2016
hayoakins:


Not in all cases, any manufacturer can monitor her retail price if she is really keen on achieving the objective(s) of regularising the retail price.

Monitor you insist? Well, I am a true practical Nigerian and I still stand on my circle saying that it will never ever work. Their strategy, though shocking (I would never believe that Coca-Cola would ever do that), is on point, cos this is Nigeria; we are a nation of quantity versus quality esp down @ the grassroots where filling ur tummy is more important than what fills the tummy. coca-cola lovers will switch back to coke cos they are getting their real money value #OneLitreForHundredNaira

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