The Coca-Cola and Pepsi: The external environment factors that will affect the two companies

Question I: External and Internal Factors 

Both Coca Cola and Pepsi have the internal environmental advantage of being powerful brands recognized globally and also holding patents to the products associated with those brands. Carbonated drinks associated with the two brands will continue to be popular into the future. The two companies also have elaborate and sustainable supply chain management systems from the perspective of supply of raw materials and sales of their respective products. Pepsi has the added advantage of rapidly expanding first food subsidiary brands that could prop it up in the case the carbonated soft drink market diminishes. The external environment factors that will affect the two companies into the future are the diminishing demand for carbonated drinks and competition from one another. 

Question II: Market Creator or Recipient 

The Coca Cola Company are creators not recipients of the market for their products. Based on the case study, it can be argued that Coca Cola created the carbonated drink market itself when they transformed a product meant for medicinal use into a carbonated drink. Having begun with only one brand, the company has expanded to create products such as Fanta, Sprite and many others. When the market for CDS started diminishing, the company bottled drinking water and created a market for it. Being a market creator, Coca Cola has been researching the target markets for potential needs that they can create products to fill, then mold this market needs to make them compatible to products that the company can make easily and sell profitably. 

Question III: Recommendations 

For most of the 20 th century, the two companies have flourished in part due to the competition between them but this competition is petering away. Both companies need a marketing strategic plan that will compensate for the marketing boost that their competition was creating for one another. Secondly, both companies have focused on marketing their traditional brands of Coke and Pepsi both of which are CSDs. The future of beverages is predicted on substantive drinks with health benefits hence the need to focus on marketing their healthier brands such as fresh juice and juice drinks.