Friday, July 18, 2008

Coca Cola prices going up. Pepsi Prices Going up next?

I was SURE I read yesterday that Coca Cola was raising their prices this Fall.

Maybe it was on Comcast?

I checked into it on Google today, and there are only a handful of articles, and they are all pretty vauge. In a nutshell, HeadQuarters say they are down about 20%, the bottlers claim that they are losing money, and so we are all going to see the prices go up.

The Moms at were talking about it here.

They also discuss some great USES for Coca Cola...other than

(How come there is not a list for 10 great uses for PEPSI? Isn't it still COLA??!?!)

When are Prices going up? - After Labor Day.

How much? - No one is saying yet.

So what does Pepsi do?

They can:

a) keep their prices where they are, and hope to capture market share. OR

b) raisee their prices TOO, much like the way Gas Prices all go up in unison in your town.

But is strategy 'A' a viable one? Would it 'matter'?

In 99% of the restraunts you go in, you don't get a 'choice'. They serve Coke or Pepsi, and you take a tall cold glass of whatever they've got.

In the grocery stores, you DO have a choice...but so much of the public has already made up their mind as to what they prefer. Will people pay a little more for Coca Cola? Sure they will.

Will they pay a LOT more for Coca Cola before switching to Pepsi?

Well, that remains to be seen, right?

What is the 'walk away' price on Coca Cola? Coke fans, especially in the South, have been incredibly loyal. At what point do they say 'AH, hell. It's just a cola!" and switch to Pepsi.

And to the earlier point, if Coke and Pepsi drinkers are both brand Loyal, couldn't the Blue Brand raise THEIR prices too...enough to be less expensive than Coca Cola but enough to squeeze out some more profit points?

Afterall, if Pepsi can win the profit margin war, they can reclaim their greatness in the Coca War, like Roger Enrico did in his book from 1986. Has it really been more than 20 years since the Cola Wars got personal?!

Both teams have been pretty demure as of late as far as the 'war' is concerned...but an opportunity for Pepsi to announce that they've become more profitable could not only reignite the fires, it could reignite the marketing campaigns.
What is YOUR walk-away price on Coca Cola?
Is there a price that would make you loyal COke drinkers switch to Pepsi?
(Coke and Pepsi continue to fight it out at


Anonymous said...

Thank you for the grate article. It does raise some important questions. What I believe people will do is substitute the coke/pepsi into another product if the cost is too high. Perhaps people will drink more water instead of soft drinks. Maybe we will see a global reduction of consumption of High Fructose Corn Syrup! Time to sell your shares of ADM!

Anonymous said...

I,m done with their sleazy methods. Pepsi here in FL is now marketing 8 packs and 18 packs at the same prices previously paid for 12 and 24 packs.

Screw them !!! I'm not about to pay 50% more for their product.

AsiaVoss said...

I'm always amazed when a manufacturer changes the shape of the bottle or the label on it, and then suggests it more valuable...or at the least AS valuable.

Do like Anonymous suggests...drink water. It costs much less and is much better for you.

Oh my GOSH! Did I just diss soda?!?!?