Market Share
Categories: Marketing
The soft drink biz is only so big. It doesn't change that much, year after year (after year). Like...1.732 billion cases shipped and drunk by thirst Whos in Whoville all over the world. And there's a small tailwind behind the biz: the world is getting warmer, more populous, thirstier. So it grows like 3% a year...maybe.
Since growth is pretty blah, then it's a Game of Thrones vibe in who has more market share than everyone else. KO has something like 36.3% this year, and PEP has something like 32.1%, and then there are tons of tiny players who comprise the rest. Since the industry doesn't really grow, in order for an individual player in it to grow, they have to take share from the other players. (See: Zero Sum Game.) Hence the wars among players being so heated and strange.
The big secret: KO and PEP are very happy being a duopoly...so yes, they want to grow, but they don't want to be regulated. That would spoil the party for all.
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Finance: What does it mean to be a marke...1 Views
And finance Allah Shmoop What does it mean to be
a market leader Well it's way better than Vienna market
Half gallon Oh wait Yeah different leader A market leader
is like this guy the Alfa dog the man or
the womb There the price center not the price taker
there The one who sets the standard in that industry
Okay think Disney Land They're the unquestioned unrivaled market leader
in theme parks They set prices meaning that they simply
figure out what price optimizes whatever Disney wants to optimize
like profits or throughput or revenues And it says Hey
Walt it's one hundred fifty bucks a day each to
come here with your whining kid cranky grandma and angry
Nanny don't like it Well then don't come We have
a million others all waiting for the privilege So Disney
sets the prices market leader and a visit to every
other theme park has to cost less than it does
to attend Disneyland or Disney World or Disney Town or
Disney Escape Room Or you know whatever in the land
of soda and soft drinks while Coke is the leader
with Pepsi just a skosh behind the two of them
comprised eight duopoly I eat a monopoly comprised of two
sellers who together completely dominate the industry They set price
in terms and distributing their wares to grocery stores and
restaurants and ballparks And you know desert vending machine thing
is everywhere We'll market leaders don't have to be huge
behemoth things either However Ferrari is the market leader in
mid life crisis cars For men they're the best The
gotta have the best distanced Yeah and they set prices
for their cars and more or less wherever they want
within a range and buyers pay up Very few if
any Ferraris ever go unsold Ferrari is the market leader
the brand leader the pack leader while other things come
to you as market leader like while the best employees
right the best at rule following grinded out corporate America
are new lamented MBA is from Harvard Business School They
run forward with blinders and enormous horsepower and when you're
the market leader they all want to fall in line
working for you Market leaders also get first dibs on
things like acquisitions like your Anheuser Busch the market leader
biggest producer of beer in the world Along comes a
whippersnapper upstart local chain of microbreweries whose customers just love
their cantaloupe line flavored drink beer Well the founders are
really ready to start enjoying life instead of smelling molding
yeast all day Who's there first phone call Gonna be
Yeah to you but no but wiser Why then while
Anheuser Busch gets first look at all the hot acquisitions
Because well they're the market leader and pretty much everyone
heart's being associated with the market leader The winner the
Alfa the Tiger the Michael The downside of being a
market leader Well there's room to fail and fall The
ladder gets slippery up there Coca Cola didn't always used
to be the bomb R the Mentos in the Coke
bottle in the early nineteen seventies Some genius exactly Coke
recognized that they bought a lot of TV ads so
that exact got Coke toe by a movie studio Columbia
Studios Yes they actually thought that buying a lot of
TV ads qualified them Tio you know tell stories of
love drama and pathos and put butts in seats in
theaters So Coke bought Colombia in the string of total
flops almost bankrupted the company Finally they sold it and
got back to repurpose ing sugar and fizzy water and
well they're really good at that Really really good Market
leaders also risk missing a big cycle especially in the
hard fought landscape of tech companies You know technology land
well in two thousand eh Well was the largest market
cap company in the world along with Yahoo and a
few other noteworthy Sze all of whom ended up being
sold for a tiny scrap fraction like just a few
percent of what they were worth That their peaks Companies
get protective they get conservative they get bureaucratic and slow
moving Sometimes live hungry entrepreneurs a lot of them from
Silicon Valley these days have all kinds of weaponry Teo
you know go whale hunting against market leaders so you 00:04:05.545 --> [endTime] know beware if you're one of them No