Case Study Coke vs Pepsi Essays

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Managerial Economics

Coke vs. Pepsi: An Economic Analysis

Rebecca Simmons
Managerial Economics
Dr Sol Drescher
December 4, 2012

Executive Summary
In this case study we will do an economic analysis of two major competitors; Coke® and Pepsi®. We will look at the history of these to competitive giants and discuss how they have evolved over the years to become rivals in the 21st Century. In this case study we will also look at the supply and demand of each company’s products. Coke and Pepsi are not only in the beverage business they have branched out into other arenas to continue being the leaders in their market. Both companies do business all over
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Pepsi has been known to use mega stars like Michael Jackson and Brittney Spears to be spokesmen for the brand which has been a big success over the years. Both Coke and Pepsi have evolved and changes in look at take over the years. Coke in the early 90’s tries to change the formula to New Coke and was soon back to what is known now as Coca-Cola Classic®. Pepsi has also tweaked its formula only to revert back to the original. Both of these companies have many many brands and brand extensions. The competitive nature is apparent in each of these companies and will continue on.
Coca-Cola seems to have a slight lead in the market and has always been a leader but not by a landslide Pepsi is always running close behind. There is both loyal Coke and Pepsi customers and some who enjoy both products and go back and forth. Coke has many brands like Minute Maid, Vitamin Water, Aquafina, Sprite, and many more. Pepsi also has many of the same or similar brands like Tropicana, Sobe Life Water, and more to coincide with Coke. Brand extensions are very important in the success of these companies. Pepsi Cola and Coca-Cola were both started in the late 1800s by pharmacists in the south Pepsi in N.C. and Coke in GA. Pepsi Co was formulated in a merger with the Frito Company which became Frito Lay. Brands like Frito Corn Chips and Lays Potato Chips and Pepsi together were formed in 1965. Though apart Frito was started in 1932 and Pepsi in 1895. This 1965

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