ds enjoy a huge lead over Pepsico brands. In the second major segment of the market supermarket shelves, however, Coca Cola brands hold only a two percent lead over Pepsico brands. Thus, a successful introduction of the Tea Breeze product could provide the Pepsi Cola Company with a needed boost in the fountain segment of the business.
There are two major threats to the soft drink industry. First, there is the decline in the growth of the domestic market. Second, there is the demographic change, in which the teenaged population segment, traditionally the largest consumer of soft drinks, is declining in proportional terms, and some projections say will decline in absolute numbers.
Significant opportunities are also available to the soft drink industry. One of these opportunities is the other side of the coin of the declining significance for the industry of the teenaged population segment. The baby boom generation is aging. The soft drink producers have an opportunity to reverse the trend of low per capita soft drink consumption among the older population segments. The popularity of iced tea with non teenaged consumers provides an opportunity for the Pepsi Cola Company with respect to the Tea Breeze product.
Nature of Problem, and Analytic Framework
The Pepsi Cola Company faces two major problems in conjunction with the introduction of the Tea Breeze product. First, the company must deal with the issue of consumer satisfaction. Iced tea, the company's marketing research has determined, tends to be more critically appraised by consumers than is true of most soft drink beverages. Second, the company must be prepared to deal with the potential of channel conflict stemming from a decision to introduce the Tea Breeze product. Resistance may be anticipated from both the Bottle and Can Division and from independent bottling companies.
Consumer satisfaction is (or should be) the goal of all mark...