Soda Companies Business Case

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Coca Cola and Pepsi Cola are worldwide power brands. They existed for over 120 years, yet they now face an existential threat.

Recent studies have shown how bad both sugars and aspartame are for humans. Not to mention the other chemicals that are used in the production of sodas.

Public health messages and the public in general have been raising awareness about the harm that such drinks can cause. Social media facilitated the delivery of the news faster than anyone could have predicted a few years ago.

Hence companies like Pepsi and Coke had (still have) to adapt.

How can we sum the objective of the giants today:

“To adapt their brand to social changes as smoothly as possible, while gaining market shares.”

Approach:

1- Product diversification: Through innovations and mergers and acquisitions. A good example is the Coconut Water by Zico that is now part of Coca Cola’s portfolio since 2013.

Reference http://www.coca-colacompany.com/press-center/press-releases/zico-8482-beverages-joins-the-coca-cola-family

2- Adopt a transparency policy.  Companies started advertising the soda part of their portfolio for what they are. An occasionally acceptable sin to be enjoyed wisely and occasionally,

3- Smarter marketing techniques. Ex: decrease the size and volume of soda cans and so on.

4- Drafting regional strategies. Every part of the world has different consumption habits. Large corporations will need to develop SMART short medium and long term adaptation strategy per target audience.

5- Social responsibility. Do more for the environment, and be a good irreproachable entity.

Smart corporations are now leveraging the popularity of their brands to up-sell other healthier choices.

Some companies may have to face the inevitable and either change their branding or close down, while others like Pepsi, have too much brand power in stake to not fight and win this battle.

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