Do an economic analysis of two giant competitors brand coke and Pepsi in the con
ID: 1158705 • Letter: D
Question
Do an economic analysis of two giant competitors brand coke and Pepsi in the context of them being rivals in the twenty first century. Please do not make it a financial case. It is to be an economic case study utilizing economic model of pure competition monopolistic competition oligopoly or monopoly paper should have a intro body an conclusion three pages with five reference an apa format remember this is not a report but an economic analysis biscus supply and demand and resulting price is lease don’t use the same information that I continue to see use fresh and new material the same paper has been filtering around and please try to give references so that I know where to get more info if I need it please help me Do an economic analysis of two giant competitors brand coke and Pepsi in the context of them being rivals in the twenty first century. Please do not make it a financial case. It is to be an economic case study utilizing economic model of pure competition monopolistic competition oligopoly or monopoly paper should have a intro body an conclusion three pages with five reference an apa format remember this is not a report but an economic analysis biscus supply and demand and resulting price is lease don’t use the same information that I continue to see use fresh and new material the same paper has been filtering around and please try to give references so that I know where to get more info if I need it please help meExplanation / Answer
Ans.
The present century cold beverage industry is dominated by the two giants namely, Coke and Pepsi. Both these products are considered to be the perfect substitutes for all practical purposes. Since the Coke and Pepsi have dominated the market over years, this market is an appropriate instance of an Oligopoly.
They have been successful in maintaining their oligopolistic stature in their industry for a long time because of cartelization. Whenever a new company entered their market, both these companies reduced their prices in order to eliminate competition. This oligopolistic cartel is the reason for their market dominance.
Despite both products being perfect substitutes, Coke has acquired a major market share globally in recent times. Let's analyse the reasons for this market dominance. Firstly, Coke is available at more common places as compared to Pepsi. For example, McDonald's, Subway & many other food chains sell Coke as compared to only KFC, who sells Pepsi. Further, Pepsi is available at places such as supermarkets and petrol stations; however, these places also sell Coke as well. Pepsi can be purchased, but it’ll take more efforts and travelling. As a rational consumer, anyone would choose Coke, saving time and money to minimise travel costs. Hence Coke has a convenience advantage.
This advantage leads to consumer loyalty & even more consumption of Coke. As brand loyalty leads to higher demand for Coke, food outlets would rather purchase Coke for their inventories, rather than Pepsi.
There are other factors as well, that make Coke dominant over Pepsi such as its marketing strategy, product design etc. However, if Coke is replaced with Pepsi, it won't make much of a difference to consumers, since they are perfect substitutes.
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