Difference Between Pepsi And Coke

973 Words 4 Pages
Brand awareness is the extent to which a brand is recognized by consumers, and creating brand awareness is one of the key steps in promoting a product such as soft drinks. The Coca-Cola Company (KO) and PepsiCo, Inc. (PEP), are dominant players in the soft drinks market. Both companies own several brands of liquid refreshments that generate more than $1 billion in revenues (Lin). Two companies also have similar products for example, Pepsi-cola and Coca-cola (coke). They taste basically the same and have similar price; for that reason, they can be considered as the perfect substitution for each other. However, the demand for coke is much higher than Pepsi. So, why is KO dominating the market? There is not a simple answer, but it is for sure …show more content…
KO and PEP have been rivals for years, which has resulted in high advertising costs for both companies. On average, PEP spends over $1 billion per year on advertising, whereas KO $2 billion per year. It is not hard to see why KO is dominating from the perspective of cost. Between 1993 and 2006 KO had spent $ 26.7 billion just on advertising, and it is one of the first companies ever to spend more money on marketing than on the product itself (Thomas) . In addition, KO has also sponsored many famous events and associations such as American Idol, NBA, NCAA, and the Olympic Games for same reason: strong advertising and marketing (Thomas). Social Media is also a great way for companies to interact with and advertise to their customers, and it is also an important piece of KO branding strategic (O 'Brien). For instance, KO has over 92 million followers on Facebook whereas PEP has about 34 millions. KO has always relied in advertising to promote and market their brand, and this is probably why they are always the best one among all the beverage companies on the Earth, and it is fair to say that it is not the product itself that made Coca Cola one of the most recognizable brands in the world; it is the exceptional marketing around it …show more content…
It might not be obvious but true that Coke is easier to get comparing to Pepsi. Many major food outlets like McDonald 's, Subway, and Burger King all sell Coke rather than Pepsi. Thus, if you want to buy a drink, you will likely to find KO’s product. If you have no specific preference between the two, then it is likely that you will get a coke to save time and money. Hence Coke has a convenience advantage (Bailey). Due to this advantage, consumer would purchase Coke more often and thus leads to brand loyalty because of the frequent consumption of Coke. In addition, food outlets typically only serve one of the two brands, either KO’s or PEP’s rather than both brands competing against each other. This results in an in-store monopoly effect (Bailey). As Coke is the only option in most food outlets, we tend to drink it more and thus reinforces consumers’ loyalty to Coke. The greater of brand loyalty leads to higher demand for Coke, thus food outlets purchase more Coke for their inventories. Overtime, as more businesses stock Coke instead of Pepsi it amplifies the convenience advantage, and thus creates a chain for Coke’s dominance

Related Documents