INTERNATIONAL STRATEGIC ALLIANCE

International Strategic Alliance

Table of Contents

Introduction3

Analysis3

Current Strategies4

SWOT Analysis4

Strength4

Weakness5

Opportunities5

Threats5

Recommendation and Conclusion5

International Strategic Alliance

Introduction

This essay will take a look at the company Pepsi Cola. For a better understanding of the subject company? this paper will delve into a brief history of the Pepsi Company's growth over the years and the effects of competition on Pepsi's strategies in the international and domestic market. This essay will attempt to discuss the effectiveness of Pepsi's marketing strategies and its results. (Clifford, 1994) Pepsi was one of several other brands that got their start in the late 1800s. A North Carolina pharmacist named invented "Brad's Drink" in 1893? which was later? renamed Pepsi-Cola. (www.pepsico.com)Pepsi's early growth was less significant than that of Coke's? and its real strength as a competitor to Coke began after became CEO in 1950? a time when Pepsi was nearly bankrupt. (Clifford, 1994) Was expected to liquidate the Pepsi-Cola Co. Instead? he made it his goal to "beat Coke".(Rudy, 1997)

Analysis

Before breaking into an international market? a company must familiarize itself first with the new country's culture? people? and economy and government regulations. The company must also define their objectives for entering a new market. Pepsi began in the early 1900's; a time when government regulations for business were less strict. (www.pepsico.com)But Pepsi did not break into the international market immediately. It first cultivated a solid consumer base in their homeland? America. Only then did the soft drink company set their sites on foreign countries. Canada was their first target. Their objective at the time was not simply to gain profits? but to broaden the reach of their company. Canada was? perhaps? closest to America? and therefore was the easiest to reach and their economy and government regulations there were familiar to Americans. (Clifford, 1994) Pepsi used their old strategy as well as a new one; they just concentrated on selling their cheaper but plentiful drink? and they expanded their distribution system from carriages to cars. In Canada? they maintained their target audience through the image of Pepsi being the Poor Man's Soda. (www.pepsico.com)Pepsi is also active in securing alliance deals with other big corporations. This is a merger-like strategy proven to be effective in marketing. For example? Pepsi has closed an alliance with Warner Brothers International Theaters and with Major League Baseball. (Center, 2003) Warner Brothers has granted Pepsi exclusive pouring rights? which means it is the only drink served in all the Warner Brothers International Theatres. Another component of the new competitive strategies of Pepsi-Cola is their increasingly complex and sophisticated advertising and promotions--a major tactic in the so-called Cola Wars. The two (Pepsi and Coca Cola) constantly strive to devise advertising campaigns that best each other. But the ultimate success of these campaigns often depends on the cooperation of the bottlers to implement the campaign in their territories. Bottlers must cooperate by arranging spot coverage and by implementing coordinated promotion and pricing policies that build on the theme of the national advertising campaign (Rudy, ...