Cola Wars Questions

1. Describe the industry using Porter’s 5 forces model. You need not go beyond 5 pages plus one great exhibit. 6 slices needed: one for overall conclusions and then one slide for each of the 5 forces to justify your conclusion.

2. Take one or two of the significant strategic moves of either or both companies and assess the impact of the initiative on industry structure.

2-4 slides needed: one slide to explain the move and a slide (or two) to show how it impacted industry structure.

3. The industry structure analysis shows why concentrate producers can sustain high levels of profitability. But many failed. Use the VRIO idea to explain why Coke and Pepsi succeeded.

3 or 4 slides needed

An industry is a collection of firms offering goods or services that are close substitutes of each other. Alternatively, an industry consists of firms that directly compete with each other. For the purpose of industry analysis, an industry can be defined rather broadly (the beverage industry) or more precisely (the carbonated soft drink industry). How one defines and circumscribes an industry depends on the kinds of analysis to be performed. In “industry analysis”, it is generally better to define an industry as precisely as possible. For example, in discussing companies like Coca-Cola and Pepsi, one would want to define the boundaries of the “carbonated soft drink industry” rather than that of the “beverage industry”. Once the industry is defined as the “carbonated soft drink industry”, other beverages (bottled water, milk, beer, juices, etc.) can be treated as substitutes in five forces analysis.