Coke and Pepsi have remained the leading marketers of carbonated drinks. The firms have been using powerful corporate strategies to emerge successfully. Coke’s intensive strategies focus on new markets and product developments. For instance, the company has been redesigning its products to address the health needs of many customers. The same strategy has also been used by Pepsi. As well, the companies have identified new markets and age groups.
We will write a custom Case Study on Coca-Cola and Pepsi Companies’ Corporate Strategies specifically for you
301 certified writers online
The two firms also use similar integration strategies. The firms have been attracting new distributors and bottlers. The firms have also been identifying cheaper sources of fructose. Diversification is achieved by producing non-carbonated drinks. Such unrelated products have continued to support the company’s goals. Coke has produced coffee, water, and tea. Pepsi has also introduced “Aquafina” to compete with Coke’s “Dasani”.
These companies can embrace better strategies in each of the above directional practices. To begin with, Pepsi can widen its intensive strategies by developing every product. This approach will produce superior products and attract more consumers. Coke can use powerful advertising strategies to increase the market share of its present products. New integration strategies can focus on different business partners. The firms can open their retail stores and outlets to increase sales. They can also purchase more bottling plants. Coke and Pepsi can transform their diversification strategies by introducing similar products that target new individuals. For example, they can produce specific products for elderly citizens.
It is agreeable that Coke and Pepsi have developed similar business models. However, an intensive corporate strategy can work effectively for the firms. The approach will ensure such products address the changing needs of more customers. They can also acquire more bottling plants to achieve their potentials. However, the “decision to take actions to pursue growth is never a risk-free choice for firms” (Hitt et al., 2010, p. 158). Such approaches will reduce costs and attract more customers.
Hitt, M., Ireland, R., & Hoskisson, R. (2010). Strategic Management: Concepts and Cases. Boston, MA: Cengage Learning.