Coco cola vs Pepsi

Coca cola vs Pepsi                     

The competition between Coco cola and Pepsi comes under oligopoly

The soft drink industry is oligopoly, because the two firms holds vast market share i.e. coca cola and Pepsi

Generally, it is B2B MARKET. To enter into this kind of markets we need heavy capital and there is no guarantee that you can survive in this market.

There will be neck to neck competition like the competion between Coca Cola and Pepsi.

These firms constitute of majority of the soft drink industry and they are not agreed to fix prices or collaborate with each other. Although they are mutually and strategically interdependent, as a decision made by one firm invariably affects the others.

If there is reduction of coke price 200ml bottle from RS 14 to RS 12 the demand will get effected and so Pepsi will also change its price

For example, is coca cola is coming up with new advertisement Pepsi will come up new advertisement.

The war between Coca Cola and Pepsi is not started now it has been for more than a century.

This explains about 5 porters model

Bargaining power of supplier is low

Bargaining power of buyers is also low for consumers

Threat to substitute consumers prefer soft drink over any other beverage

Threat of new entrants the risk is every high it involves huge capital

Industry rivalry secret ingredients