History

Pepsi Cola and Coca Cola has been in the cola wars for centuries now. It erupted 13

years after the birth of Coca Cola by pharmacist Caleb Bradham, when Pepsi Cola

was created. This made the two cola producers a direct competitor with one another.

Over the decades after the creation of the two colas’, Coca Cola continuously evolved

its brand and expanded to Europe while Pepsi was struggling to keep track as it

suffered from bankruptcy a couple of times due to the WWI. In the 50’s, both

companies were at their peak with advertising and expanding their business to other

countries. They had strategies to stay in the business competitively, both companies

embraced advertising platforms, celebrities endorsements, merging with other

companies; as Pepsi merged with Frito Lay in the 60s which created PepsiCo which

hauled a great revenue for Pepsi until today (Bhasin, 2013).

Firstly, to compare the branding strategies of these two household brands, it can be

compared and discussed using the five levels of meaning for a product.

The core benefit

Pepsi Cola and Coca Cola has the same core benefit for their products, which is to

quench the thirst of their consumers as well as selling a non-alcoholic soft drink. Core

benefit is the fundamental need or want that consumers satisfy by consuming the

product or service (Kotler/Keller 2012)

The generic product

A generic product is the basic version of the product containing only those attributes

or characteristics absolutely necessary for it’s functioning but with no distinguishing

features (Keller, 2012). Thus generically, both Pepsi Cola and Coca Cola are both soft

drinks.

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The expected product

The expected product is defined as a set of attributes or characteristics that buyers

normally expect and agree to when they purchase a product. When consumers get a

hold of a Pepsi Cola product, they are expecting the sweet, citrusy flavor burst (Lubin,

2012) and when other consumers grab a Coca Cola product they await the raisiny –

vanilla taste of the soft drink (Gladwell, 2012). The Coca Cola products are constantly

produced in a red background with the iconic Coca Cola writing. Conversely, Pepsi

products are packaged in a can with their blue writing.

Augmented Product

The Coca Cola products would also feature the label and nutritional facts of the

product. It also provides the contact details of the manufacturer and place of

manufacturing for after sales service purposes. Other additional information such as

the website domain is given for product support.

Pepsi Cola on the other hand may have some similarities to the coca cola product.

Pepsi Cola has a great customer support as they offer easy accessibility and fast

response as well as Pepsi Cola’s availability for contact if an issue occurs (Sheikh,

2002).

Potential product

Potential product is including all the augmentations and transformations that product

might ultimately undergo in the future (Keller, 2012).

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As for Coca Cola, they pledge to help their consumers be active and make informed

nutritional choices (Coca Cola Company, 2012). Coca Cola is offering array of

products that would be hydrating and fitting for their individual needs and lifestyle

that offers low and no calorie beverages and regular calorie beverages packaged in

smaller portions (Coca Cola Company, 2012). This solution was made to address the

global problem of obesity as reported by World Health Organization statistics. Coca

Cola believes that the impact of obesity on the health of the consumer affects the

health of their business thus they became more concerned with the public health. A lot

of researchers and health advocates blame the consumption of sugar-sweetened

beverages as the cause of obesity.

Pepsi Co is also affected by the global issue of obesity and is taking an initiative to

help curb the situation. Pepsi Co is looking at lowering their salt, sugar and saturated

fats that is in their food and beverage products. The company will also increase whole

grains, fruits, vegetables, nuts and low-fat dairy incorporated in their food products.

They are also looking at being environmentally conscious, for example the fully

compostable chip bag that will decompose entirely in 14 weeks (PepsiCo).

Brand knowledge

Brand knowledge as explained as Kevin Keller, as the awareness of the brand name

and belief about the brand image (Keller, 1993). Branding is a potent element for a

product and between the two brands; Pepsi Cola and Coca Cola; the latter is seen as a

more valuable brand (Lubin, 2012). It can be deducted that brand knowledge is

important for the health of the company. The Coca Cola brand is worth $79 billion in

the year 2013 according to Interbrand in comparison of Pepsi Cola brand, which is

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only $17 million worth. Adding on, according to an article written in Interbrand titled

“Best Global Brands”, the brand awareness disseminated by Coca Cola is a powerful

spread as according to a survey by Research Now, the company scored 90% in brand

awareness among the respondents from various countries such as Canada, United

Kingdom, United States, Germany, France and also Australia. The company scored

big when they sold millions of beverages during Olympics London 2012, but they

scored a bigger win with a high return of global viewership. The event also allowed

Coca Cola to solidify a powerful association in the minds of billions of people around

the globe. The company has used this event to also show their strong presence as a

sponsor and also as a strong brand. A consumer from a different country can identify

a Coca Cola product, even though it’s in a foreign language and they may still

recognize the product immediately (Lauren, 2012). As for Pepsi Cola, their strategy to

heighten their brand awareness was with multiple projects under the name “Pepsi

Refresh Project” as well as bringing back the old Pepsi Challenge where a blind taste

test is conducted against Coca Cola. The favorable outcome for Pepsi Cola from these

tests is that the testers would always prefer Pepsi to Coca Cola. On a different point,

the availability of the two products worldwide could be a contributing factor to their

differences in brand awareness. Coca Cola is much more widely available than Pepsi

Cola. Coca Cola creates a sort of convenience for consumers for being widely

available thus getting the loyalty of the consumers. There is a higher demand for Coca

Cola than Pepsi thus the monopolization in restaurants are more favorable towards

Coca Cola. For example, McDonalds, Subway, Nando’s are all providing Coca Cola

as a beverage in comparison to KFC as one of Pepsi’s territory (Lin, 2012).

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According to an article by Design Council UK regarding ‘The Power of Branding’,

the brand association with Coca Cola and its product would be that the brand

promises their consumers the great same taste; with the original recipe which is

branded as The Real Thing, and also happiness, youthfulness, classic, energetic, and

refreshing. In comparison, Pepsi also associates themselves with these keywords; fun,

refreshing, youthfulness. Pepsi would appeal to the younger generation with the usage

of celebrity endorsers. A great list of famous celebrities such as Michael Jackson,

Britney Spears and most recently the singer Beyoncé as the brand’s endorsers was

used to gain vast attention from all ages of consumers (Johnson, 2011). The usage of

celebrities as endorsers of the brand adds to the brand image (Erdogan, 1999). Apart

from that, the visual for Coca Cola adds to the association of the product as the

familiar red and white colors of the brand as well as the iconic Coca Cola writing

complemented with the unique shape of the bottles represents the brand itself

The brand image helped the associations of this brand in the minds of their

consumer. Brand image is consumer’s perception about a brand as reflected by the

brand associations. As for Coca Cola, their logo is an iconic logo that has been

consistent throughout the years (Emily, 2013). Thus, when a consumer sees the brand,

they have the perception of devouring in a classic, great tasting soft drink that is

refreshing. Equally, Pepsi bears in mind that Coca Cola tries to be “timeless” so Pepsi

goes to be “timely” meaning they would be in the now, being a modern and edgy cola

brand (Colom, 2012). Therefore, consumers perceive the brand as the current and

younger brand to consume.

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Product Class Information

Product Category Information

Product Type Information

Brand Information

Product Category Hierarchy

Above is the product category hierarchy for the two brands. Both brands have the

same product class information which is both brands selling beverages. Categorically,

both brands are focused to selling flavored drinks more than water, although Coca

Cola has a mineral water branded as “Dasani”, Coca Cola’s company reels in most of

its revenue and market share with their soft drinks; Coca Cola and Diet Coke. Moving

on to the third level, the product type information groups the two brands under the

same category, which is non-alcoholic that reflects all of the products under the two

brands that offers non-alcoholic beverages. Finally, the lowest level is the level that is

regarding the brand information, which describes what are the types of product under

the brand.

Beverages

Water Flavored

Non-Alcoholic

Milk Hot Beverages

Juices Soft Drinks

Pepsi Cola Coca Cola

Alcoholic

Wine Beer

Distilled Spirits

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Brand Positioning

Ideally brand positioning is the act of designing the company’s offer and image so

that it occupies a distinct and valued place in the target consumer’s minds (Kotler and

Keller, 2006). It is also a way to delicately position the brands in the minds of

consumers so that they think of the brand in the right or desired manner, which will in

the end, maximize potential benefit to the company. The cola wars between the two

name brands has been started for centuries, they are well aware that they are in

competition with one another and at multiple occasions have directly compared

themselves publicly; The Pepsi Challenge. To distinguish themselves, they have

targeted different audiences, as Pepsi Cola has always had the younger generation in

mind. Their advertising and marketing strategies are fixed to target teens aged 14 or

even younger with a fun and most often interlaced with music. This is evident over

the years as Pepsi had musical celebrities like Michael Jackson, Britney Spears and

now Beyoncé (Vendredi, 2012). In contrast to Coca Cola, their target audience is

wider but ensuring the products pleases the generation Y as well as the older

generation. They achieve this by trying a fresher new image to reach the younger

generation but maintaining the originality of the cans and bottles as well as taste for

the older generation. Adding on, Coca Cola also targets diversifying their audience

and taking geographical aspects in high consideration as they target the world filled

with different cultures (Lyle, 2010). Coca Cola also positions themselves as a drink fit

for the entire family while in contrast Pepsi aims to reach the teens (Vendredi, 2012).

These brands position themselves also knowing their indirect and direct competitors.

Other cola beverages in the market are their direct competitors and between the two

they are the most competitive with each other. Indirect competitors are other produces

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of beverages such as juices, teas or coffee (Dixon, 2009). Pepsi Cola and Coca Cola

falls under the same product category, which is beverage, they however have some

similarities; points of parity and differences; point of differences. The potent

differences are the taste, ingredients as well as the branding between these two

brands. As mentioned before in this study, Pepsi Cola has a taste of citrust in the drink

while Coca Cola has a more raisin and vanilla in their product. The ingredients of

these products also can be differentiated as Pepsi has slightly more sugar, caffeine and

calories while Coca Cola has slightly more sodium (Lubin, 2012). Coca Cola is a

much fizzier drink due to its high percentage of carbonation in comparison to Pepsi

Cola. Other than that, according to an article written on Soft Drink Face Off website,

on the surface the product looks different with Coca Cola using the familiar red label

with the iconic Coca Cola writing and Pepsi with the blue, white and red stripes as the

background with a Pepsi writing (2013). Both brands also have different bottling

packaging, which each company has patented. For example Coca Cola’s iconic

contour shaped bottle that was patented in 1915. Not to mention the company of Pepsi

Cola does not only focus on beverages but has reaping in revenue from their flagship

food, mainly chips products. Despite the differences, vast consumers lean towards

Coca Cola more than Pepsi which can be concluded that Coca Cola’s branding is

much more valuable (Lubin, 2012). On another note, the similarities of these two

brands are that they have a wide variety of soft drinks beverages that enter the market

and of course the basic of the products being soft drinks. Other more straightforward

similarities are that they are both soft drinks and non-alcoholic that was created by

southern pharmacists. Other than that, both brands offer a product that has the same

core value that is to quench the thirsts of consumers with a cola carbonated drink.

Brand elements

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Brand elements are implemented to distinguish one brand from its competitors. It

consists of the brand names; what does it mean and why it was named that, its logos

and symbols, the URL it may use to help consumers get to the website of the brand,

the slogans the brands use to describe their product, packaging of its products,

characters that goes along with it as well as jingles. Starting with the Coca Cola

brand, it evokes images of the red Coca Cola logo with a red and white themed

advertising and packaging. The logo itself is distinctive enough to help consumers

identify the brand (Coca Cola UK). The name came about by the creator, Dr John

Stith Pemberton who decided that two c’s would be great on a label thus created the

brand name. In comparison to the typical look of the cans, the packaging of the

products can be better distinguished by their iconic contoured bottles. They also

introduced the six packs carriers to encourage people to bring their drinks home,

which was a huge success (Coca Cola UK). According to their website, Coca Cola

have used slogans as a part of their advertising or marketing purposes thus it has

changed over the years from 1886 to 2006. Their famous ones are from the year 2001

which Life Tastes Good, 1963; Things go better with Coke, 1969; it’s the Real Thing

and the recent one “The Coke Side of Life” (2012). A part of their advertising efforts,

a jingle was created to accompany most of their commercials and it became

synonymous with the brand as written on Wordlab website (2005). Adding on to their

brand elements, the URL for the company is easy enough to be retrieved by memory

as its just the brand name; www.cocacola.com. Other than that, it is evident in their

advertising that the polar bears are the characters they use in those advertisements or

billboard posters. The creator of the character, Ken Stewart wanted to depict a

character that is cute and innocent, fun and also reflects human attributes (2012).

Conversely, Pepsi brings an image of the predominantly blue colored Pepsi logo with

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its red, white and blue background that was a patriotic approach by the company

(Bhasin, 2013). Its brand name on the other hand, was a brainchild of the creator

Caleb Bradham, whom at first regarded the drink as “Brad’s drink”, he then named

the product something that had to do with the ingredient of the product; which was

Pepsin and Cola. Overtime the product was branded as Pepsi Cola as reported by the

website Pepsi Store. An article from Timetoast that was written regarding Pepsi’s

packaging and logo stated that, its logo has been the writing of Pepsi Cola which

underwent drastic facelifts over the years however today the logo are represented only

by the three colors of the brands which are the iconic blue, red and white (2013).

Adding on to the brand elements of Pepsi, the company also generates their slogans

that would give a younger feel and targets the younger generation. Their slogan “The

Pepsi Generation” and the year 2000 slogan, “For those who feel young” clearly

depicts their brand that attempts to attract more younger audiences (Mary, 2012).

Other than that, as reported by Giant Bomb, the mascot for Pepsi is the Pepsiman, a

well-known character in Japan that was created in 1990s. Another part to the brand

element of Pepsi would be its URL. The company uses www.pepsi.com as its main

website which a simple method of connecting the consumers to the brand. The same

as Coca Cola, both brands continue to create their own packaging. Over the years

Pepsi has patented their bottles, this goes for Coca Cola as well, and it has become

their distinguished differences that helps consumers identify the brands involved.

Adding on, Pepsi recently has created a bottle that could secure favorable aromas as

when the bottle or can is opened, it releases these favorable aromas to enhance the

drinking experience (Wagner, 2013).

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