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The “Soda War” between Coke and Pepsi has lasted for more than a century. Historically, Coke has been the preferred consumer choice even though research has shown Pepsi wins in taste tests. The marketing campaigns of both Coca-Cola and PepsiCo demonstrate the efforts of both companies to influence and capitalize on cultural and consumer trends. From celebrity endorsements to branding and product image, the marketing battle rages on. Recent trends toward healthier lifestyles are causing both companies to rethink their strategies. Method Discussion Coke vs. Pepsi Francis Garcia, Chloe Kim, Lisa Pearson, Jennifer York Azusa Pacific University Figure #2 References Literature Review Results Data was collected from 20 current graduate students at Azusa Pacific University. The students were from two different campus locations, and were asked if they would like to participate in a survey. They were selected through a verbal agreement and a sign-up sheet. Demographic data or personal characteristics were not factors in our research and therefore were excluded in our survey. Although our research sample is small, we believe the data will be useful for further research. 20 graduate students participated in the study and completed the survey that was provided through the website SurveyMonkey. The website provided a summary of the results and the researchers analyzed the data. All the data for the quantitative questions used in the survey are summarized in Table 1. For our study, we hypothesized that graduate students at Azusa Pacific University would prefer Coke over Pepsi. The “Soda War” between Coca-Cola and Pepsi started when Pepsi came on the scene in 1903 and continues today. Each corporation has invested in, and continues to use new advertising and marketing strategies to attract consumers (Moraru, 2010). Brooks, S., (2013, August). Soda problems: It’s a new public health enemy number one. What’s a restaurant to do? Restaurant Business , 29-39. Figure #1

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Literature Review The “Soda War” between Coke and Pepsi has lasted for more than a century. Historically, Coke has been the preferred consumer choice even though research has shown Pepsi wins in taste tests. The marketing campaigns of both Coca-Cola and PepsiCo demonstrate the efforts of both companies to influence and capitalize on cultural and consumer trends. From celebrity endorsements to branding and product image, the marketing battle rages on. Recent trends toward healthier lifestyles are causing both companies to rethink their strategies.

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One current strategy given the technology explosion is to build brands through social media. Coke and Pepsi are choosing Facebook, Twitter and other social sites like Pinterest to communicate with their followers and buy in to social media’s ability to strengthen their brands. Currently, consumers are 55% more likely to recall ads that include social media components over traditional ads, according to a 2011 Nielsen survey. Companies are discovering that consumers are incredibly empowered and what used to work to get their attention now needs a bit more thoughtfulness, creativity and sophistication (Snider, 2012). Studies have also shown that commercial positioning of a product is crucial.

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The question among ad agencies is “how do we get our product to stick in someone’s mind, knowing the vast amount of choices there are?” Jack Trout and Al Ries book, Positioning: the Battle for your Mind (as cited in Moraru, 2010), focused on delivering the commercials message to the customer’s mind in order to integrate the brand in his world of connections and similarities. They discovered the longer, the more complicated the mess, the quicker it will be deleted from a very busy mind. Thus, less is more. Their commercial strategy to get consumers to take notice is “sharpen the message to cut to the mind, simplify the message and then simplify it some more, if you want to make a long lasting impression” (p.48). The intense competition for people’s taste buds is due to today’s overloaded messages and communication. Advertising is looking for new sources to win the battle for a stable place inside consumer’s minds, and is using lots of tricks to stimulate their perceptions (Moraru, 2010).

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Coca-Cola was discovered/created before Pepsi. Coca-Cola was invented in 1886. PepsiCo began in 1903. The battle between the two has been intense from the beginning. Both brands have strived to connect with their consumers, aligning with powerful images. For example, Coca-Cola was featured with Santa Clause in 1931. Both position themselves as a high-status product associating with celebrity type stars from political, social and cultural stages (Moraru, 2010). In the last few years, the fight is developing in the field of integrated marketing communication, but also in the creative area. Everyone remembers the commercial in which a little girl is given a Coke instead of a Pepsi. As a result of this competition, both have capitalized on innovation, diversity, ambition, and especially avoiding dangerous limitation.

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Pepsi started as a poor and distant relative, but has used every moment of Coca-Cola’s weakness to try to gain advantage of its rival. The Pepsi brand has a stable position that could still threaten Coke if they don’t keep up with changing trends. Throughout the years the focus of Coca-Cola’s advertising has been to associate with personalized American pride, national culture, patriotism, and satisfaction, where Pepsi has chosen to position itself on the life styles of being young, dynamic and nonconformist: thus the Pepsi Generation (Moraru 2010).

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In spite of the great popularity of both sodas, there are rising public health concerns about the links between consumption of sugar-sweetened beverages and weight gain, obesity and other cardiometabolic problems. And although major beverage companies continue to rely on their flagship brands of Coke and Pepsi and their diet equivalents, they have responded to public health concerns, sluggish sales growth and consumer preferences by expanding their beverage portfolios and shifting production to new, healthier options. These options include lower-calorie carbonated soft drinks, bottled water, and ready to drink teas (Kleimen, Ng, and Popkin, 2011).

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This has become a bit of a concern to advertisers that watched the market share of CSD’s (carbonated soft drinks) decline from 70 to 50% of non-alcoholic liquid refreshment market between 1988 to 2008, led by declines in full-calorie CSD’s (Kleimen, Ng, and Popkin, 2011). The rise of bottled water and sports and energy drinks is suggesting patterns of change across beverage categories. Also in response to the demand for healthier options, Coca-Cola and PepsiCo are revamping their ‘healthier’ offerings enabling both companies to increase in net revenue and profit for their global operations. Although value sales of CSD declined in the US from 2000 to 2010, overall soft drink sales increased 12% for Coca-Cola and 22% for PepsiCo, demonstrating that these companies can profit even as their portfolios shift away from CSD’s (Kleimen, Ng, and Popkin, 2011).

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Regardless of the healthier demand in the cola industry, Pepsi and Coke still have the strongest name recognition of all sodas. This is a result of longevity of the product and the greater classical attitudinal conditioning that has resulted over the past 100 years. As a result, lesser known colas such as Shasta or RC are more malleable than the more firmly established attitudes toward the icon-like Coke and Pepsi (Shimp, Stuart and Engle 2004).

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In another unique study, Michael Koenigs and Daniel Tranel (2007) addressed the Pepsi Paradox: a microcosm of the effectiveness of commercial advertising where in blind taste tests, subjects prefer Pepsi over Coke, or have no reliable preference for one cola over the other, but yet Coke consistently outsells Pepsi. The conclusion is “brand recognition is what sells.” This was shown in a study where they looked at VMPC damage (ventromedial prefrontal cortex) which is an important area for drawing upon emotion. Those that had damage to their VMPC did not show a preference for Coke, which has been shown to have greater brand recognition. In other words, those who had damage to their prefrontal cortex of the brain did not choose Coke over Pepsi because they were not influenced emotionally by the commercial images that directed their brand preference.

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Another population that is very valuable to advertisers is children and youth. In 2007, children and teens watched on average 3 hours and 25 minutes of television per day, and television remains the primary advertising medium used to reach children and youths (Powell, Szczypka, and Chaloupka 2010). The majority of food ads seen by children were products high in sugar, fat or sodium. Fun and happiness themes were the most common persuasive appeals used. In 2003 and 2007 fruit drinks and regular soft drinks made up the greatest proportion of beverage ad exposure. Among teens in 2003, regular soft drinks ads were by far the most frequently seen beverage ads. In 2007, exposure to diet soft drink ads increased among all ages groups: 2-5, 6-11, and 12-17 (2.5%, 82.7% and 106.3%) (Powell, Szczpka, and Chaloupka 2010).

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Ultimately, it still comes down to personal choice between Coke and Pepsi, even though Pepsi usually wins taste tests, but Coke has been the leader in most categories of marketing: packaging, pricing, distribution, and advertising, for the past 30 years. The future challenge and success for both Coke and Pepsi depends on a highly segmented advertising approach in which both companies go after a predefined sector that represents the cutting edge of contemporary trends and fashions (Louis 1985).

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Method Participants Data was collected from 20 current graduate students at Azusa Pacific University. The students were from two different campus locations, and were asked if they would like to participate in a survey. Participants were selected by way of verbal agreement and a sign-up sheet. Demographic data or personal characteristics were not a factor in our research and therefore were not included in our survey. Although our research sample is small, we believe the data will be useful for further research.

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Materials We formed our research group and idea through our online Research Methodology course. We communicated through the Sakai course web page in the forums section, as well as through email. The group section in forums provided us with resources and guidelines for completing our project. After designing our research project, developing a hypothesis, and reviewing the literature on our selected topic, we developed a survey of 10 questions to send out to the participants in our study. The survey consisted of 8 quantitative questions utilizing the Likert Scale format, and 2 qualitative, open-ended questions. We conducted our survey by utilizing the online service of SurveyMonkey.com.

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Procedure Once we developed and completed our survey questions, one member of the group sent the following information to Reyna Guzman, representative of the OIRA (Office of Institutional Research & Assessment) for approval: 1. A list of our survey questions 2. Contact person 3. Group members (names and email addresses) 4. Start to finish dates for conducting the survey ( March 8-29, 2014) 5. General description of our sample of participants Upon approval from Reyna Guzman to proceed with our research, we sent the approval header from OIRA, our informed consent letter and link to our survey to all our participants via email. The consent letter stated that participants could stop or opt out of their participation in the research project at any point without repercussions. At the finish date of our survey, we were pleased to discover that all 20 participants completed the survey. We then gathered and analyzed our results through Survey Monkey, and created charts and graphs through Microsoft Excel to visualize the data.

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Results 20 graduate students participated in the study and completed the survey that was provided through the website SurveyMonkey . The website provided a summary of the results and the researchers analyzed the data. All the data for the quantitative questions used in the survey are summarized in Table 1. The answers from the survey showed that graduate students today prefer to drink Coke over Pepsi, when they do choose to drink soda. In addition, participants are not drinking soda and are choosing to drink healthier beverages.

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The results of the survey support the hypothesis and also the recent trends in drinking healthier options instead of soda. When participants were given the statement “I prefer the taste of Pepsi over Coke” 8 disagreed, 5 strongly disagreed, 3 remained neutral, 2 agreed and 2 strongly agreed ( M=2.4, SD=1.27). Most of the participants disagreed with this statement ( M=2.4) and as shown in Figure 1 only 20% of participants agreed with the statement. Participants also felt that Coca Cola was more popular than Pepsi ( M=4.05) . 16 participants agreed with the statement “I consider Coca Cola to be more popular than Pepsi.” Figure 2 displays the results and as it shows only 1 participant disagreed with this statement.

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The results also gave some interesting insight into how people see marketing affecting their product choice. In our research of past data a lot of attention was paid to the marketing practices of Coca Cola and Pepsi. When the participants were given the statement, “Advertising is an important factor in determining my preference for Coke or Pepsi,” 10 participants strongly disagreed, 6 disagreed, 3 neither agreed nor disagreed, and only 1 participant agreed ( M=1.75, SD=.91). A total of 16 participants did not feel advertising impacted their choice in soda which is 80% of participants as illustrated in Figure 3. Participants in the study also seem to not actually be big soda drinkers ( M=3.8). When given the statement “ I rarely drink Coke or Pepsi” 8 participants strongly agreed, 5 participants agreed, 3 neither agreed or disagreed, 3 disagreed, and 1 strongly disagreed ( M=3.8, SD=1.28). Figure 4 illustrates the participant’s responses.

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In addition, when reviewing the qualitative data which 19 out of 20 participants answered 5 participants responded that they don’t drink soda in response to being asked to share what influences their soda purchases. Some participants listed availability, price and taste as to what influences their soda purchases. Participants were also asked to summarize if past and current trends impacted their attitude toward Coke or Pepsi and 18 out of 20 participants answered the question. 6 participants reported that trends do not affect their attitudes towards Coke. One participant reported that because Coke appears to be more popular it causes the participant to like Coke better. Two participants reported that familiarity with the soda (i.e. grew up with the product in the home) influenced their choice. Six participants shared that the trends in recent years towards healthier options have actually influenced them not to drink soda because of the recent knowledge of how unhealthy soda is. There was a wide range of responses but it does seem that trends influence people, in different ways, but they do influence.

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Figure IV

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Discussion For our study, we hypothesized that graduate students at Azusa Pacific University would prefer Coke over Pepsi. The “Soda War” between Coca-Cola and Pepsi started when Pepsi came on the scene in 1903 and continues today. Each corporation has invested in, and continues to use new advertising and marketing strategies to attract consumers (Moraru, 2010). From the data collected and analyzed it appears that participants in the study believed Coke to be more popular than Pepsi, and reported preferring Coke over Pepsi when choosing to drink soda. Therefore, this part of our hypothesis was supported.

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The results from this study are similar to the results found in previous studies where Coke wins in preference (Koenigs & Tranel, 2007). In addition, the study attempted to find what influential factors are important to people when choosing their soda. We were surprised to learn that advertising was not a factor. This contradicted much of the literature we examined. Therefore, this part of the hypothesis was not supported. In reality, it seems that participants feel that taste, availability, price and familiarity with a product are stronger influential factors. Although, some of these factors could also be included or controlled by marketing strategies, the participants in the study did not feel that advertising played any role in their drink choice.

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The questions used in the survey asked participants about their drink choices, thoughts of popularity, and influential factors in their choice. However, the results are limited because participants were only asked a small number of questions. In addition, the study involved a low number of participants with a narrow population. All participants are graduate students that attend Azusa Pacific University and therefore generalizability is limited. Further research on what influences purchases of Coke or Pepsi would be informative. Moreover, the study produced additional areas for investigation, specifically, the trend in choosing healthier drinks. Many participants in this study expressed that they actually don’t drink soda on a regular basis or at all. Further research on this topic would give some more insight into preferred beverages. This information could be beneficial for corporate companies who produce soda or any soft drinks in general.

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References Brooks, S., (2013, August). Soda problems: It’s a new public health enemy number one. What’s a restaurant to do? Restaurant Business , 29-39. Cho, S., Lee, M., Yoon, T., Rhodes, C., (2011). An analysis of the Olympic sponsorship effect on consumer brand choice in the carbonated soft drink market using household scanner data. International Journal of Sport Finance, 6(4), 335-353. Kleiman, S., Ng, S.W., Popkin, B., (2011). Drinking to our health: Can beverage companies cut calories while maintaining profits? Obesity Reviews, 13, 258-274. doi: 10.1111/j.1467-789x.2011.00949. Koenigs, M., Tranel, D., (2008). Prefrontal cortex damage abolishes brand- cued changes in cola preference. SCAN (Social, Cognitive & Affective Neuroscience), 3, 1-6. doi: 101093/scan/nsm032. Louis, J.C., (1985, January). The cola wars: Pepsi and Coke are fighting a global struggle for the hearts and minds of cola drinkers. Management Review , 52-58. McClure, S.M., Li, J., Tomlin, D., Cypert, K.S., Montague, L.M., Montague, P. R. (2004, October). Neural correlates of behavioral preference for culturally familiar drinks. Neuron, 44, 379-387. doi: 10.1016/J.neuron.2004.09.019.

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McKelvey, S.M., (2006). Coca-Cola vs PepsiCo ---- a “super” battleground for the cola wars? Sport Marketing Quarterly, 15(2), 114-123. Moraru, M., (2010). The “positioning” concept and the fight between two well- known brands, Coca cola and Pepsi. Journal of Media Research, 7, 47-62. Paracha, A.M. J., Wayas, M., Khan, A.R., Ahmad, S., (2012). Consumer preference: Coca Cola versus Pepsi-Cola. Global Journal of Management and Business Research, 12(12), 7-10. Abstract retrieved from http://www.creativecommons.org. Powell, L., Szczypka, G., Chaloupka, F.J., (2010). Trends in exposure to television food advertisements among children and adolescents in the United States. Arch Pediatric Adolescent Medicine, 164(9), 749-802. Retrieved from http://archpedi.jamanetwork.com. Shimp, T.A., Stuart, E.W., Engle, R.W., (1991, June). A program of classical conditioning experiments testing variations in the conditioned stimulus and context. The Journal of Consumer Research, 18(1), 1-12. Retrieved from http://jstor.org. Snider, M., (2012, April 30). Cola companies get social in battle. USA Today , p. B2.

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