Competitive Strategies Case Study

WAHAHA: POSING A THREAT TO COCA COLA AND PEPSI IN CHINA

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Abstract:
Hangzhou Wahaha Group Co Ltd (Wahaha), since 1987, has been in the Chinese soft drink industry. Qinghou Zong, the Chairman and Chief Executive Officer, was responsible for the company?s transition from a small entity selling ice-creams to children, to one of the leading players in the industry. The company had a wide range of products, catering to different segments. It had bottled water, fruit juices and ready to drink tea with various flavours. Wahaha was the market leader in the bottled water segment, while Coca Cola and Pepsi dominated the carbonate sector. To compete in the carbonate sector, Wahaha introduced Future Cola in 1998 which soon picked up pace. The company knew that competing with these giants in the urban sector, would not be fruitful. Thus, it chose the strategy of ?flank attack? and became the leader in the rural sector.

Pedagogical Objectives:

• To gives an overview of the Chinese soft drink industry and illustrates the various strategies of Wahaha to compete with Coca Cola and Pepsi in China.

Keywords : Wahaha; Coca Cola; Pepsi; China; Soft drink industry; Carbonate sector; Bottled water; Fruit juices; Distribution; Target segment; Growth rate; Disposable income; Advertisements; Per capita consumption; Marketing

Contents : 
Soft-Drink Industry In China
Wahaha’s Strategy
Share Of Marketing Budget Of Wahaha
The Product Life Cycle Of Soft Drink Categories In China
Disparity In Income Between Rural And Urban Populations