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Sse cola wars_7b_2011

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Transcript

  • 1. Jonatan Schwamberg Pontus Wiehager Ender Yunus Xiqing Deng Media Management Group 7b Case Study
  • 2. The five forces framework
  • 3. Five forces applied to the case
  • 4. The concentrate producers industry – rivalry and profitability
      • RIVALRY
      • High industry concentration
        • Coke and Pepsi both have huge market shares
      • High importance of brand awareness and identity
        • Marketing wars
      • PROFITABILITY
      • Extremely high profitability (ROE 15% - 55%)
      • Due to industry concentration and brand awareness and identity
  • 5. Supplier and customer bargaining power
      • LOW SUPPLIER BARGAINING POWER
      • Due to the concentrated concentrate producers industry vs the fragmented bottlers industry
      • Resulted in vertical integration
      • RATHER LOW CUSTOMER BARGAINING POWER
      • Customers with rather low bargaining power (smaller stores)
      • Customers with rather high bargaining power (McDonalds, Wal-Mart etc.)
      • THE BARGAINING POWER FROM CUSTOMERS DECREASES PROFITABILITY, BUT ONLY SLIGHTLY
  • 6. Threat of entry and substitutes
      • LOW THREAT OF ENTRY
      • The actual threat is low due to the entry barrier of brand awareness and identity
      • LOW THREAT OF SUBSTITUTES
      • The same goes for substitutes, brand awareness and identity are important here as well
      • Although, this is another factor contributing to the rather static prices of Coke and Pepsi
      • THE BARGAINING POWER FROM CUSTOMERS DECREASES PROFITABILITY, BUT ONLY SLIGHTLY
  • 7. The bottlers industry – rivalry and profitability
      • RIVALRY
      • High industry fragmentation
        • Many players with small market shares puts emphasis on price
      • High customer bargaining power
        • Coke and Pepsi
      • High importance of brand awareness and identity
        • Marketing wars
      • PROFITABILITY
      • Extremely low profitability (ROE 2% - 13%)
      • Due to price wars and high rivalry
  • 8. Industry attractiveness – concentrate producers vs bottlers
      • EXTREME DIFFERENCES IN PROFITABILITY
      • Makes the concentrate producers industry more attractive
      • ENTRY BARRIERS
      • Concentrate production industry: brand awareness and identity
      • Bottlers industry: high minimum efficient scale
  • 9. Future challenges
      • INDUSTRY SPECIFIC CHALLENGES (source: 1)
      • Diet related problems
      • Food safety and consumer trust
      • Global economy turndown
      • 1. http://www.htrends.com/report-2158332-Issues__Trends_And_Challenges_Facing_The_Food_And_Drink_Industry___Forecasts_To_____.html