Environmental Analysis Assignment

Competitive Advantage and Strategies

PepsiCo and Coca Cola are the largest food and beverage companies in the overall market. PepsiCo is focused towards providing the convenient foods and beverages to the consumers. On the other hand, Coke is focused towards fulfilling the moments of happiness, create value and make difference. Coca Cola spend large amount of funds for its marketing strategies. Company is more concentrated to improve its brand awareness. Effective marketing is the competitive advantage for Coca Cola. Although, Coca Cola product diversity is not very strong but through effective marketing strategy company can be able to give competition to rivalry firms (Coca Cola, 2012).


PepsiCo main competitors are the Coca-Cola, Dr. Pepper/Snapple and Kraft. In order to give competition to PepsiCo, Coca Cola has to focus towards their product category and offer a diversified range of products. PepsiCo is the leading food and beverage company in the United States in comparison to their competitors. Product diversity of PepsiCo helps in giving competition to the Coca Cola. PepsiCo has around 17 distinct brands that help in increasing their sales around 1 billion per year. Product diversity helps in fulfilling the diversified needs of their customers (PepsiCo, 2011).


PepsiCo has used various international marketing strategies in order to sustain in the competitive market environment. Additionally, company has used market penetration strategy in order to capture the large amount of customers. Company has also used market development strategy in order to expand their operations in global market. On the flip side, strategy of Coca Cola is to serve the customers with creativity and consistency. Company also focuses on its system and operational activities to improve profitability and capability through their bottling partners. Coca Cola also make direct investments in the high potential market areas (PepsiCo, 2011).


Business Strategies

Every company can be able to create values through satisfying the customer needs and wants. PepsiCo declare that their values are reflected in their socially and environmentally responsible company. Moreover, company is also able to provide sustained growth through acting responsibly and building trust. PepsiCo is focused towards talent sustainability, which is helpful in developing skills and sustaining competitive advantage of the company. PepsiCo is also engaged towards adopting low cost differentiation strategy that can be achieved through economies of scale (Bachmeier, 2009). Through low cost differentiation strategy, company can be able to make difference in their products through taste and marketing.


In case of Coca Cola, its main aim is to create value for their shareholders. Moreover, in order to achieve these values and sustaining competitive advantage company has adopted different business strategies. Coca Cola has adopted value based market segmentation, which is helpful in capturing the industry value potential. Apart from this, Coca Cola has also implemented well-planned product, packaging and pricing strategies that are helpful in sustaining their competitive advantage (PepsiCo, 2011). Company has also adopted strategies that are helpful in achieving the full operating potential of the company’s commercial models.


Company has also made efforts to make improvements in their overall operational efficiency. Improvement in efficiency of workforce helps in sustaining the competitive advantage of company.

Measurement Guidelines

In order to measure the performance, PepsiCo has adopted the corporate standards that are helpful in governing the company’s operations. Along with this, PepsiCo is also able to ensure the accountability of actions that are taken by the company in order to achieve the goals and objectives. Company has framed different policies such as quality and food safety programs, responsible marketing and healthcare reforms in order to measure the overall performance of company (Annual Report, 2010). PepsiCo is the environment responsible corporate citizen and they have declared this statement in their environment policy.


Quality and Food Safety Programs are introduced that gives detailed information about safety of products and package. PepsiCo also developed Quality Organization in order analyze the compliance of their products with PepsiCo’s Quality Policy. This Quality Organization also analyzes the qualities of different areas such as food safety, manufacturing quality, supplier quality, plant quality, etc. (Annual Report, 2004).


Coca Cola use to measure their key products and quality through analyzing their materials, ingredients, regulating manufacturing and distribution. Company ensures that products that are introduced in market must fulfill company requirement and consumer expectations. Moreover, in order to ensure the reliability, Coca Cola has introduced The Coca Cola Management System (TCCMS) (Coca Cola, 2012). After sometime this system was replaced by Coca Cola Operating Requirement (KORE), which helps in analyzing the changing scenario. KORE also helps in supporting the strategic growth of the company.


Coca Cola has introduced Hazard Analysis and Critical Control Points (HACCP) in order to manage the risk in the company and also provides problem solving methods (Coca Cola, 2012).


Effectiveness of Measurement Guidelines

Measurement Guidelines used by both the companies are very much helpful in improving their performance in competitive market. Measurement guidelines used by the PepsiCo helps in capturing the large part of market shares and customers as well. Additionally, Quality and Food Safety Programs are proving to be very effective in performing strongly across the business units, its brands and market (PepsiCo, 2011). Company has also adopted the code of conducts that are useful in providing proper guidance to all the employees. These codes of conduct help PepsiCo in protecting the human rights in the workplace.


Effectiveness of these codes of conduct is measured by the Internal Audit methodology that analyzes the compliance of employee’s performance with stated rules. Through measurement guidelines company can be able to encourage the suppliers, partners, contractors and vendors to support policies (PepsiCo, 2011).


Coca Cola measurement guidelines are very much effective in overcoming the future problems. Coca Cola analyzed that HACCP proves to be very effective in managing the risk of future. Company makes assessment of all the activities on the basis of HACCP norms and conditions. Measurement Guidelines adopted by Coca Cola is an instrument that helps in improving performance and gaining recognition in the marketplace. Company is also able to minimize its impact on the natural environment. Company is also responsible towards fulfilling the needs and wants of community (Coca Cola, 2012).



Annual Report (2004). PepsiCo. Retrieved from http://www.pepsico.com/Download/2004-Annual-English.pdf

Annual Report (2010). PepsiCo. Retrieved from http://www.pepsico.com/Download/PepsiCo_Annual_Report_2010_Full_Annual_Report.pdf

Bachmeier, K. (2009). Analysis of Marketing Strategies Used by PepsiCo Based on Ansoff’s Theory. Germany: GRIN Verlag.

Coca Cola (2012). Retrieved from http://www.coca-colafemsa.com/femsa/web/conteudo_en.asp?idioma=1&conta=44&tipo=27617

Coca Cola (2012). Retrieved from http://www.coca-colahellenic.com/sustainability/environment/

Coca Cola (2012). Retrieved from http://www.thecoca-colacompany.com/citizenship/sustainability_roadmap.html

PepsiCo (2011). Retrieved from http://www.pepsico.com/Careers.html

PepsiCo (2011). Retrieved from http://www.pepsico.com/Company/PepsiCo-Values-and-Philosophy.html

PepsiCo (2011). Retrieved from http://www.pepsico.com/Purpose/Overview/Policies.html

PepsiCo (2011). Retrieved from http://www.pepsico.com/Purpose/Sustainability-Reporting/GRI-Index.html

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