Coke and Pepsi in India

PepsiCo entered India in July 1986 and CocaCola decided to renter the India market in May 1990 after a previously unsuccessful stint which ended in 1977. No matter what time you enter the Indian market it is always a difficult market to crack because of its reputation for not embracing foriengn owners. The figures that the average Indian only bought three bottles of carbonated drinks a year would also be quite worrying especially after comparing to these figures to other countries.

However Pepsi clearly felt that the Indian market could be a hugely profitable one long term and felt making an early entry was essential.. Pepsi felt that the first mover advantage would reward them the oppurunity to gain competive advantage over companies who have arrived later than they have. However there is also the huge risk sometimes the very first entrant fails even before the followers enter the market. The follower, on the other hand, may be able to free-ride on the earlier entrants' investments and gain from the languished uncertainties that characterize the new markets. At first the latter occurred with Pepsi having huge problems dealing with the intense local completion especially because thet were not as high profile as other brands and their aggressive pricing policy which did seem like a smart move at the time di not work because their main competitor dealt with this by introducing a bigger bottle for the same price. After 7 years in the Indian market there were still a large 34% behind market leader Parle in market share.

The entry of CocaCola was different to different to Pepsi because they had already been in the region previously. CocaCol