Wildlife: Biodiversity and Net Deforestation Rates

Around the world, forests are being logged for timber and paper pulp and cleared to grow mono-crops like soy and palm oil while they are deteriorating from the impacts of global warming. Deforestation is a major driver of global warming, responsible for up to 20 per cent of global greenhouse gas emissions–more than all the cars, trucks, planes, boats and trains in the world combined. Deforestation doesn’t just threaten our climate, it threatens the livelihoods of 1. 6 Billion people that rely on forests for food and economic activity.Forests also serve as habitats to rare and undiscovered animal and plant species and play a key role in providing water and preventing flooding and erosion. Ending deforestation and protecting forests will not only preserve biodiversity and defend the rights of forest communities, it is also one of the quickest and cost effective ways of curbing global warming. Greenpeace is campaigning for zero deforestation, globally, by 2020. Deforestati on,  clearance  or  clearing  is the removal of a forest or stand of trees where the land is thereafter converted to a non-forest use. 1]  Examples of deforestation include conversion of forestland to farms, ranches, or urban use. About half of the world's original forests had been destroyed by 2011, the majority during the previous 50 years. [citation needed]  Since 1990 half of the world's  rain forests  have been destroyed. [citation needed]  More than half of the animal and plant species in the world live in tropical forests. [2] The term  deforestation  is often misused to describe any activity where all trees in an area are removed. not in citation given][neutrality  is  disputed]  However in  temperate climates, the  removal of all trees in an area[not in citation given]—in conformance with  sustainable forestry  practices—is correctly described as  regeneration harvest. [3]  In  temperate mesic climates, natural regener ation of forest stands often will not occur in the absence of disturbance, whether natural or anthropogenic. [4]  Furthermore, biodiversity after regeneration harvest often mimics that found after natural disturbance, including biodiversity loss after naturally occurring rainforest destruction. 5][6] Deforestation occurs for many reasons: trees are cut down to be used or sold as fuel (sometimes in the form of  charcoal) or timber, while cleared land is used as  pasture  for livestock, plantations of commodities and settlements. The removal of trees without sufficient  reforestation  has resulted in damage to  habitat,  biodiversity  loss and  aridity. It has adverse impacts on  biosequestration  of atmospheric  carbon dioxide. Deforestation has also been used in  war  to deprive an enemy of cover for its forces and also vital resources.A modern example of this was the use of  Agent Orangeby the United States military in Vietnam during the  Vietnam W ar. Deforested regions typically incur significant adverse  soil erosion  and frequently degrade into  wasteland. Disregard or ignorance of intrinsic value, lack of ascribed value, lax forest management and deficient environmental laws are some of the factors that allow deforestation to occur on a large scale. In many countries, deforestation, both naturally occurring and human induced, is an ongoing issue.Deforestation causes  extinction, changes to climatic conditions,  desertification, and displacement of populations as observed by current conditions and in the past through the fossil record. [5] Among countries with a per capita  GDP  of at least US$4,600, net deforestation rates have ceased to increase. [when? ][7][8] ————————————————- Causes According to the United Nations Framework Convention on Climate Change (UNFCCC) secretariat, the overwhelming dir ect cause of deforestation is agriculture.Subsistence farming  is responsible for 48% of deforestation;  commercial agriculture  is responsible for 32% of deforestation;  logging  is responsible for 14% of deforestation and fuel wood removals make up 5% of deforestation. [9] Experts do not agree on whether industrial logging is an important contributor to global deforestation. [10][11]  Some argue that poor people are more likely to clear forest because they have no alternatives, others that the poor lack the ability to pay for the materials and labour needed to clear forest. 10]  One study found that population increases due to high fertility rates were a primary driver of tropical deforestation in only 8% of cases. [12] Other causes of contemporary deforestation may include  corruption  of government institutions,[13][14]  the  inequitable  distribution of wealth and power,[15]  population growth[16]  andoverpopulation,[17][18]  and  urbanization. [ 19]  Globalization  is often viewed as another root cause of deforestation,[20][21]  though there are cases in which the impacts of globalization (new ? ws of labor, capital, commodities, and ideas) have promoted localized forest recovery. [22] The last batch of sawnwood from thepeat forest  in Indragiri Hulu, Sumatra,Indonesia. Deforestation for  oil palmplantation. In 2000 the United Nations  Food and Agriculture Organization  (FAO) found that â€Å"the role of population dynamics in a local setting may vary from decisive to negligible,† and that deforestation can result from â€Å"a combination of population pressure and stagnating economic, social and technological conditions. [16] The degradation of forest ecosystems has also been traced to economic incentives that make forest conversion appear more profitable than forest conservation. [23]  Many important forest functions have no markets, and hence, no economic value that is readily apparent to the fore sts' owners or the communities that rely on forests for their well-being. [23]  From the perspective of the developing world, the benefits of forest as carbon sinks or biodiversity reserves go primarily to richer developed nations and there is insufficient compensation for these services.Developing countries feel that some countries in the developed world, such as the United States of America, cut down their forests centuries ago and benefited greatly from this deforestation, and that it is hypocritical to deny developing countries the same opportunities: that the poor shouldn't have to bear the cost of preservation when the rich created the problem. [24] Some commentators have noted a shift in the drivers of deforestation over the past 30 years. 25]  Whereas deforestation was primarily driven by subsistence activities and government-sponsored development projects like  transmigration  in countries like  Indonesia  and  colonization  in  Latin America,India,  Jav a, and so on, during late 19th century and the earlier half of the 20th century. By the 1990s the majority of deforestation was caused by industrial factors, including extractive industries, large-scale cattle ranching, and extensive agriculture. [26] [edit] Wildlife conservation  is the practice of protecting  endangered plant and animal species  and their  habitats.Among the goals of wildlife conservation are to ensure that nature will be around for future generations to enjoy and to recognize the importance of  wildlife  and  wilderness  lands to humans. [1]Many nations are  government agencies  dedicated to wildlife conservation, which help to implement policies designed to protect wildlife. Numerous independent  nonprofit organizations  also promote various wildlife conservation causes. [2] Wildlife conservation has become an increasingly important practice due to the negative effects of  human activity  on  wildlife. The science of extinction.An e ndangered species is defined as a population of a living being that is at the danger of becoming extinct because of several reasons. Either they are few in number or are threatened by the varying environmental or predation parameters. ————————————————- Government involvement The Wildlife Conservation Act was enacted by the Government of India in 1972. Soon after the trend of policy makers enacting regulations on conservation a strategy was developed to allow actors, both government and non-government, to follow a detailed â€Å"framework† to successful conservation.The World Conservation Strategy was developed in 1980 by the â€Å"International Union for Conservation of Nature and Natural Resources â€Å"(IUCN) with advice, cooperation and financial assistance of the United Nations Environment Programme (UNEP) and the World Wildlife Fund and in collaboration with the Food and Agriculture Organization of the United Nations (FAO) and the United Nations Educational, Scientific and Cultural Organization (Unesco)†[9]  The strategy aims to â€Å"provide an intellectual framework and practical guidance for conservation actions. [9]  This thorough guidebook covers everything from the intended â€Å"users† of the strategy to its very priorities and even a map section containing areas that have large seafood consumption therefore endangering the area to over fishing. The main sections are as follows: * The objectives of conservation and requirements for their achievement: 1. Maintenance of essential ecological processes and life-support systems. 2. Preservation of genetic diversity. 3. Sustainable utilization of species and ecosystems. * Priorities for national action: 1. A framework for national and subnational conservation strategies. . Policy making and the integration of conservation and development. 3. Environmental planning and rational use allocation. * Priorities for international action: 1. International action: law and assistance. 2. Tropical forests and drylands. 3. A global programme for the protection of genetic resource areas. Map sections: 1. Tropical forests 2. Deserts and areas subject to desertification. Importance Of Wildlife 37  Ã‚  6  StumbleUpon4 If you were of the opinion that cultivated plants and domesticated animals is what wildlife consists of, you are mistaken.Wildlife, in fact, comprises of the innumerous varieties of wild plants, animals, fungi and microorganisms that exist on our planet earth, rather than just cultivated plants and domesticated animals. Knowingly or unknowingly, we largely depend on this wildlife for every elementary requirement in our life. The food we eat, the clothes we wear, the medicines we consume, a variety of building materials used for construction, numerous chemicals used for manufacturing our necessities, all are extracted from the wildlife existing around us.A study by the American Association for the Advancement of Science indicates that as many as 40,000 species of plants, animals, fungi and microscopic animals benefit us in some way or the other. To know the various benefits that this wildlife provides us, read on further. Benefits Of Wildlife Benefits To People Wildlife and nature have largely been associated with humans for numerous emotional and social reasons. A simple stroll around the park amidst some birds provides a fresh breath of life and charges our batteries. Apart from bird feeder in the backyard, we can also take up other active pastimes, such as hiking, hunting, canoeing or wildlife photographing to relieve our parched nerves. Since prehistoric times, animals have been highly useful to us in providing food, clothing and source of income. Benefits To Natural Processes Wildlife plays an essential role in the ecological and biological processes that are yet again significant to life. The normal functioning of t he biosphere depends on endless interactions amongst animals, plants, and microorganisms. This, in turn, maintains and enhances human life further.To add on, these ecological processes are vital for agriculture, forestry, fisheries and other endeavors that support human life. Besides, there are several biological processes wherein wildlife plays a key role, such as pollinization, germination, seed dispersal, soil generation, nutrient cycling, predation, habitat maintenance, waste breakdown, and pest control. Benefits to Science, Agriculture, & Medicine Studies indicate that woodpeckers are capable of destroying 90% of codling moth larvae residing under the bark of trees. This shows the significance of wildlife and wildlife habitat for preserving genetic diversity.Hence, places where agriculture, forests, and fisheries depend on crops or stocks can ensure that such living resources are enough to withstand the ever-increasing list of threats. Further, in medicine, development of new d rugs and treatments are largely dependent on wildlife and wildlife habitat. Interestingly, most pharmaceutical products are a result of discovering or developing wildlife species and not discoveries through the traditional chemistry principles. Today, most medicinal remedies contain at least one ingredient derived from a wild plant or animal.

Summary of Instructional Problem

In the state of Kentucky Social Studies education focuses on five big ideas that all topics can fall under. These topics are government and civics, cultures and societies, economics, geography, and historical perspective. (Kidwell, 2012) Geography is one of the big five ideas and is extremely important. One of the foundations of geography is the use of map skills. Map skills can include simply reading a map, using visual literacy to decode information represented on a map, tracing a route from point A to point B, and using the information on a map to problem solve and make inferences.At Conway Middle School students in 6th, 7th, and 8th grades have problems with map skills. Specifically, students do not know how to correctly read a map, identify the different types of maps, locate information on a map, and when given a starting point and directions could not correctly trace/navigate to a disclosed or undisclosed end location. For example, when given the starting point for the explora tion of the Louisiana Territory by Lewis and Clark on a map and basic directions students could not correctly follow the path using geographic tools such as maps, atlas, globes, and photos.These are skills that students will need as they progress through their academic pursuits and in life. Based on data collected and a needs analysis there is a need for interventions to help resolve this instructional problem. Goal Statement Students in the 6th, 7th, and 8th grade at Conway Middle school after successfully completing the instructional unit will be able to apply the map skills that have been learned in the real world. Conway Middle School is an inner city, title 1 school. A reality of this is that many students rely on riding public transportation to get to and from school.One of the real world goals for instruction is that students will be able to look at a road map and navigate from Point A to Point B without the need for electronic devices to assist with mapping. The students wil l be able to correctly give someone directions to get from their present location to another location. The students will examine a map of the bus routes in the city of Louisville and be able to correctly pick the buses they would need to get on to get home from any location serviced by the Transit Authority of the River City.Students will use their learned map skills to problem solve using maps, graphs, and charts in other subject areas such as math and science. In addition to these real world applications students will be able to perform at a level greater or equal to 80% correct on a summative assessment given by the teacher that encompasses all the topics from the unit of instruction. The summative assessment will include topics from the desired conditions of this needs analysis. While map skills are a social studies topic they have many applications in other core content areas and within the real world.Many people use them on a daily basis and do not even realize their importanc e. While the goal of middle school social studies education should be to provide students with the skills to become good citizens and prepare them with the content knowledge and skills necessary to lay a foundation for college and career readiness that will lead to successful high school academic endeavors. The reality is that we must also meet state standards and often loose site of the most important part of the social studies content. The part of social studies content that I am referring to is the preparation of students to become good citizens.Learner Analysis Before beginning the learner analysis needs, the researcher feels it important to take moment to introduce the instructional setting of the group. For this learner analysis the instructional setting is Conway Middle School in Jefferson County, Kentucky. Conway Middle School is an inner city, title 1 school. The school is located in the Pleasure Ridge Park community of Louisville, Kentucky. Pleasure Ridge Park is located o n the south side of Louisville. Like many other major metropolitan areas the south side of town is not the most sought after area to live in or be from.Some students are bused into the area from other sections of town. Conway Middle School is home to almost 1000 students of various genders and ethnicities. The instructional unit will be taught in a 6th grade social studies classroom. The average amount of students in the classroom on a daily basis is 120. The 6th grade is made up of three teams of teachers. Each team has a social studies, math, language arts, and science teacher. Throughout the course of a normal school day a group of 130 students will rotate into each content area for seventy minutes.Now that the setting has been discussed let’s talk about the learners. Requisite Knowledge and Skills In the state of Kentucky middle school social studies has no prerequisite social studies skills or knowledge needed to be successful. However, there are certain requisite skills and knowledge that will help all students succeed. First, students need to have reading comprehension skills. The students must be able to read and write within one or two levels of the current grade. Second, the students need math comprehension skills.Math skills might sound funny as a requisite knowledge for social studies but it is true. Without math skills students would be ill prepared to understand the numbers on a map, the dates of events, cost of wars, and even the reasons behind the migrations of millions of people to new areas seeking better jobs, economic success, and untold fortunes. The reading skills are essential because what we know about social studies is made up from artifacts. Many of those artifacts are journals, diaries, declarations, newspapers, books, and interviews that in order to understand them a person would need reading skills.If a student has the requisite skills listed above the teacher can design an instructional unit that builds knowledge from the g round up. Now that the requisite skills have been discussed let’s take a look at the prior knowledge and skills of the learner group. Prior Knowledge and Skills The learner group has been assessed for prior knowledge and skills. A part of the assessment took place when the researcher administered a test/pre-test for the needs analysis in task 1. The teacher has also been assessing the students as the school year progressed.It was found that despite the best efforts of the learner group’s previous teachers many of the students lack basic knowledge of map skills. The students were taught map skills in the 5th grade, but very little was retained. During other assessments the teacher found out that many students could remember some of the words related to map skill but were unable to define them or their importance. The data from the previous assessments showed that there was a foundation to build upon but essentially the teacher was starting from the ground up when design ing the instructional unit.Most students knew their directions but very little otherwise. When given an atlas to assist with the pre-test the students’ average score overall was 52%. The data gathered from the needs analysis and other assessments of prior knowledge and skills will drive the design and focus of the instructional unit on map skills. Now that prior knowledge and skills have been discussed let’s move on to the demographic information of the learner group. Demographic Information The demographic makeup of the learner group is diverse. There are a total of 130 students in the group.62 of the students are male and 68 are female in gender. The ethnic makeup of the males is as follows: 49% African American, 40% white, 10% Latino, and 1% Asian. The ethnic makeup of the females is as follows: 53% African American, 41% white, 5% Latino, and 1% Asian. The females outnumber the males by almost 10%. 55% of the students come from single parent households. The ages ran ge from 10 years old to 12 years old and are of varied maturity levels. With over half of the students coming from single parent households, parental support is sometimes at low level.Having a majority of the students being female and/or African American influences the way in which the teacher must design the instructional unit. The demographics can sometimes make it difficult to design instruction in a way that is both relevant and interesting for all students. Along with taking into account the demographics of the learner group the teacher must account for the learner group’s attitudes towards the topic when designing instruction. Learner Group Attitudes Attitude is everything. When designing a unit of instruction a teacher must take into account the learner group’s attitudes toward the topic, education, and teachers.That might sound like an easy task but it is not. Students bring past experiences and attitudes toward teachers and education into the classroom every d ay. This has a profound influence on the learning environment. For example, almost half of the students that this teacher sees on daily basis say social studies is their least favorite subject at school. Some of those same students attribute this to previous teachers and the experience that they have had. Other students like social studies but hate map skills calling it boring and useless. These students are the ones that make designing instruction a little more time consuming. To combat thenegativity towards social studies the teacher must go out of his/her way to build the relationships with students to foster a mutual respect and hopefully instill a lifelong love of learning. While building the relationships the teacher is able to design instruction in a way that is relevant to each student and interesting. Despite best efforts there will always be one or two students with a negative attitude towards the topic. One way that I have found to make learning fun and interesting is thr ough the use of whole brain teaching. Whole brain teaching accounts for all learning styles and at the same time manages behaviors in the classroom.Speaking of learning styles, let’s take a look at the unique characteristics of the students in the learner group. Unique Characteristics Within the teacher’s class there is a diverse group of learners. They are made up of various ethnicities from many different backgrounds. First, let’s take a look at the learning styles of the group. About halfway through the school year the teacher was introduced to a new to him style of teaching. That style was called Whole Brain Teaching. The teacher is bringing this up because of the variety of learning styles in his classroom.Those learning styles are kinesthetic, visual, and auditory. When the program was implemented in this teacher’s classroom he surveyed the class to ask about their learning style. It was very informative. Over half of the class said that they learne d best in more than one way. At first the teacher was worried. He thought to himself how am I going to teach to all of these learning styles? I will spend all my free time designing instruction. It really wasn’t that bad. The whole brain teaching method allowed the teacher to reach the students that were kinesthetic learners by incorporating movement in the classroom.The visual learners learned by watching the teacher teach, other students teach, reading, and by watching short video clips incorporated into the lessons. The auditory learners heard the teacher teaching, listening to other students during the turn and teach portion of the lesson, by listening to the oral reading of exerts, and by listening to the video clips incorporated into the lessons. The unique characteristics of the learners means that the teacher must design lessons that incorporate visual, auditory, and kinesthetic pieces into the instruction.At times it can be very difficult to design a lesson that reac hes all learning styles. This only takes into account the unique characteristics of a little over three quarters of the class. Almost 15% of the class were/are ECE or Special Education Students. The special education students have a variety of diagnoses that range from Attention Deficit Disorder, Attention Deficit Hyperactivity Disorder, Other Health Impairment, Learning Disorder, Behavior Disorder, to Oppositional Defiant Disorder. Those are a wide range of diagnoses and they must be taken into account as well.In addition to those diagnoses one student suffers from seizures that can be triggered by flashing lights. What does all of this mean? It means that a great attention to detail must be used by the teacher when designing the instructional unit and the learning environment. The teacher has a binder with all of the Individual Education Plans and a spreadsheet to make instructional design easier. When designing the instructional unit and assessment the teacher must take into acco unt the accommodations that these IEP’s allow.Accommodations As stated above 15% of the class is made up of ECE or Special Education students. These students all have IEP’s that allow for accommodations. The accommodations are as follows: extended time, paraphrasing, the use of a reader, the use of a scribe, prompts and cues, redirection, preferential seating choice, and a special behavior plan. When designing the instruction the teacher accounts for extended time by creating fill in the blank note sheets for all students. This way the students aren’t singled out by others.Paraphrasing is allowed for when the teacher is reading the text or lecturing. Usually it is qualified for the students with a statement that starts out with â€Å"in other words it means this. † The reader is allowed for during the lessons and during assessments. During assessments the teacher reads each question out to the class. When that is not possible a qualified special education profession will take the students that require reader to another location to administer the test. The one student that is allowed a scribe has a special electronic device that he carries with him each day.The lessons are scanned into a document for him to complete on the device. Assessments are handled in the same fashion. The students that are allowed prompts and cues receive them throughout the lesson. Sometimes it is just a matter of walking by and pointing something out to the student. At other times it requires a verbal cue or redirection. Two students have IEPs that allow for preferential seating because they have very poor eyesight. At the beginning of the school year I asked the two students in private which seat they would prefer in the front row.Those two students pointed out their seats and have been in them ever since. When the lesson or classroom is moved around these students get preferential seating. One student has a special behavior plan. He is a very smart student . This student only has an IEP because his disruptive behavior sometimes requires removal from the stimulus of the class. All students that are allowed accommodations based on their IEPs receive them. Performance Context The performance context in which the students are expected to use the new skills and knowledge has several locations.Based on the real world instructional goal the students will go be able to go out into the city and do certain tasks but for the class the students will practice these in a safe and controlled environment. For example, one of the goals discusses being able to read a map and give directions to from Point A to Point B. Before this will be applied in the real world students will apply it in the classroom. Am I saying that all the students are going to go give someone directions or ride the bus home? No, what I am saying is that at the completion of the instructional unit the student will be prepared to do these tasks if needed.The teacher has an instruct ional lesson that involves the students using only a map and or atlas to route a family vacation to another state. Through demonstration of using the atlas to correctly route a family vacation the students will have simulated part of the real world goals in a controlled environment. In light of the fact that many students use public transportation to get to and from school the teacher has designed a lesson that again allows the students to practice this real world activity in a safe and controlled environment.For that lesson all the students will have a copy of the Transit Authority of the River City, the city bus company, TARC for short’s routes. The assignment requires the students to examine the bus routes and correctly list the buses that they will need to ride to get from Conway Middle School to their house. When the students complete this assignment they will also have to account for the bus schedule and determine what time to leave, how long they will be at each bus st op, and the amount of time it will take them to get from school to home.One of the performance contexts is in the current classroom and future classrooms. What I mean by this is that after the successful completion of the unit the students will have better map skills that can be applied in this social studies classroom and in other classrooms both in the present and the future. Through a thorough learner analysis the teacher is better prepared to design the unit of instruction to meet the needs of all of his students and prepare them to be successful.

5 Coke vs Pepsi 21st Century Case Study

op y 9-702-442 REV: JANUARY 27, 2004 DAVID B. YOFFIE tC Cola Wars Continue: Coke and Pepsi in the Twenty-First Century For over a century, Coca-Cola and Pepsi-Cola vied for â€Å"throat share† of the world’s beverage market. The most intense battles of the cola wars were fought over the $60-billion industry in the United States, where the average American consumed 53 gallons of carbonated soft drinks (CSD) per year. In a â€Å"carefully waged competitive struggle,† from 1975 to 1995 both Coke and Pepsi achieved average annual growth of around 10% as both U. S. nd worldwide CSD consumption consistently rose. According to Roger Enrico, former CEO of Pepsi-Cola: No The warfare must be perceived as a continuing battle without blood. Without Coke, Pepsi would have a tough time being an original and lively competitor. The more successful they are, the sharper we have to be. If the Coca-Cola company didn’t exist, we’d pray for someone to invent them. And o n the other side of the fence, I’m sure the folks at Coke would say that nothing contributes as much to the present-day success of the Coca-Cola company than . . . Pepsi. 1This cozy relationship was threatened in the late 1990s, however, when U. S. CSD consumption dropped for two consecutive years and worldwide shipments slowed for both Coke and Pepsi. In response, both firms began to modify their bottling, pricing, and brand strategies. They also looked to emerging international markets to fuel growth and broadened their brand portfolios to include non-carbonated beverages like tea, juice, sports drinks, and bottled water. Do As the cola wars continued into the twenty-first century, the cola giants faced new challenges: Could they boost flagging domestic cola sales?Where could they find new revenue streams? Was their era of sustained growth and profitability coming to a close, or was this apparent slowdown just another blip in the course of Coke’s and Pepsi’s e nviable performance? 1Roger Enrico, The Other Guy Blinked and Other Dispatches from the Cola Wars (New York: Bantam Books, 1988). ________________________________________________________________________________________________________________ Research Associate Yusi Wang prepared this case from published sources under the supervision of Professor David B.Yoffie. Parts of this case borrow from previous cases prepared by Professors David Yoffie and Michael Porter. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright  © 2002 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www. hbsp. harvard. edu.No part of this publication may be reproduced, stored in a retrieval system, used in a s preadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School. Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 Economics of the U. S. CSD Industry Americans consumed 23 gallons of CSD annually in 1970 and consumption grew by an average of 3% per year over the next 30 years (see Exhibit 1).This growth was fueled by increasing availability as well as by the introduction and popularity of diet and flavored CSDs. Through the mid-1990s, the real price of CSDs fell, and consumer demand appeared responsive to declining prices. 2 Many alternatives to CSDs existed, including beer, milk, coffee, bottled water, juices, tea, powdered drinks, wine, sports drinks, distilled spirits, and tap water. Yet Americans drank more soda than any other beverage. At 60%-70% market share, the cola segment of the CSD industry maintained its dominance throughout the 1990s, followed by lemon/lime, citrus, pepper, root beer, orange, and other flavors. C CSD consisted of a flavor base, a sweetener, and carbonated water. Four major participants were involved in the production and distribution of CSDs: 1) concentrate producers; 2) bottlers; 3) retail channels; and 4) suppliers. 3 Concentrate Producers The concentrate producer blended raw material ingredients (excluding sugar or high fructose corn syrup), packaged it in plastic canisters, and shipped the blended ingredients to the bottler. The concentrate producer added artificial sweetener to make diet soda concentrate, while bottlers added sugar or high fructose corn syrup themselves.The process involved little capital investment in machinery, overhead, or labor. A typical concentrate manufacturing plant cost approximately $25 million to $50 million to build, and one plant could serve the entire U nited States. No A concentrate producer’s most significant costs were for advertising, promotion, market research, and bottler relations. Marketing programs were jointly implemented and financed by concentrate producers and bottlers. Concentrate producers usually took the lead in developing the programs, particularly in product planning, market research, and advertising.They invested heavily in their trademarks over time, with innovative and sophisticated marketing campaigns (see Exhibit 2). Bottlers assumed a larger role in developing trade and consumer promotions, and paid an agreed percentage—typically 50% or more—of promotional and advertising costs. Concentrate producers employed extensive sales and marketing support staff to work with and help improve the performance of their bottlers, setting standards and suggesting operating procedures.Concentrate producers also negotiated directly with the bottlers’ major suppliers—particularly sweetener and packaging suppliers—to encourage reliable supply, faster delivery, and lower prices. Do Once a fragmented business with hundreds of local manufacturers, the landscape of the U. S. soft drink industry had changed dramatically over time. Among national concentrate producers, CocaCola and Pepsi-Cola, the soft drink unit of PepsiCo, claimed a combined 76% of the U. S. CSD market in sales volume in 2000, followed by Cadbury Schweppes and Cott Corporation (see Exhibit 3).There were also private label brand manufacturers and several dozen other national and regional producers. Exhibit 4 gives financial data for Coke and Pepsi and their top affiliated bottlers. 2 Robert Tollison et al. , Competition and Concentration (Lexington Books, 1991), p. 11. 3 The production and distribution of non-carbonated soft drinks and bottled water will be discussed in a later section. 2 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century BottlersBottlers purchased concentrate, added carbonated water and high fructose corn syrup, bottled or canned the CSD, and delivered it to customer accounts. Coke and Pepsi bottlers offered â€Å"direct store door† (DSD) delivery, which involved route delivery sales people physically placing and managing the CSD brand in the store. Smaller national brands, such as Shasta and Faygo, distributed through food store warehouses. DSD entailed managing the shelf space by stacking the product, positioning the trademarked label, cleaning the packages and shelves, and setting up point-of-purchase displays and end-of-aisle displays.The importance of the bottler’s relationship with the retail trade was crucial to continual brand availability and maintenance. Cooperative merchandising agreements between retailers and bottlers were used to promote soft drink sales. Retailers agreed to specified promotional activity a nd discount levels in exchange for a payment from the bottler. tC The bottling process was capital-intensive and involved specialized, high-speed lines. Lines were interchangeable only for packages of similar size and construction.Bottling and canning lines cost from $4 million to $10 million each, depending on volume and package type. The minimum cost to build a small bottling plant, with warehouse and office space, was $25million to $35 million. The cost of an efficient large plant, with four lines, automated warehousing, and a capacity of 40 million cases, was $75 million in 1998. 4 Roughly 80-85 plants were required for full distribution across the United States. Among top bottlers in 1998, packaging accounted for approximately half of bottlers’ cost of goods sold, concentrate for one-third, and nutritive sweeteners for one-tenth. Labor accounted for most of the remaining variable costs. Bottlers also invested capital in trucks and distribution networks. Bottlers’ gross profits often exceeded 40%, but operating margins were razor thin. See Exhibit 5 for the cost structures of a typical concentrate producer and bottler. Do No The number of U. S. soft drink bottlers had fallen, from over 2,000 in 1970 to less than 300 in 2000. 6 Historically, Coca-Cola was the first concentrate producer to build nation-wide franchised bottling networks, a move that Pepsi and Cadbury Schweppes followed.The typical franchised bottler owned a manufacturing and sales operation in an exclusive geographic territory, with rights granted in perpetuity by the franchiser. In the case of Coca-Cola, territorial rights did not extend to fountain accounts—Coke delivered to its fountain accounts directly, not through its bottlers. The rights granted to the bottlers were subject to termination only in the event of default by the bottler. The original Coca-Cola franchise contract, written in 1899, was a fixed-price contract that did not provide for contract renegotiation even if ingredient costs changed.With considerable effort, often involving bitter legal disputes, Coca-Cola amended the contract in 1921, 1978, and 1987 to adjust concentrate price. By 1999, over 81% of Coke’s U. S. volume was covered by the 1987 Master Bottler Contract, which granted Coke the right to determine concentrate price and other terms of sale. Under the terms of this contract, Coke was not obligated to share advertising and marketing expenditures with the bottlers; however, the company often did in order to ensure quality and proper distribution of marketing.In 2000, Coke contributed $766 million in marketing support and $223 million in infrastructure support to its top bottler alone. The 1987 contract did not give complete pricing control to Coke, but rather used a pricing formula that adjusted quarterly for changes in sweetener prices and stated a maximum price. This contract differed from Pepsi’s Master Bottling Agreement with its top bottler, which gran ted the bottler 4 â€Å"Louisiana Coca-Cola Reveals Crown Jewel,† Beverage Industry, January 1999. 5 Calculated from M. Dolan et al. , â€Å"Coca-Cola Beverages,† Merrill Lynch Capital Markets, July 6, 1998. Timothy Muris et al. , Strategy, Structure, and Antitrust in the Carbonated Soft-Drink Industry, (Quorum Books, 1993), p. 63; John C. Maxwell, ed. Beverage Digest Fact Book 2001. 3 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 perpetual rights to distribute Pepsi cola products while at the same time required it to purchase its raw materials from Pepsi at prices, and on terms and conditions, determined by Pepsi.Pepsi negotiated concentrate prices with its bottling association, and normally based price increases on the CPI. Coke and Pepsi both raised concentrate prices throughout the 1980s and early 1990s, even as the real (inflation-ad justed) retail prices for CSD were down (see Exhibit 6). tC Coca-Cola and Pepsi franchise agreements allowed bottlers to handle the non-cola brands of other concentrate producers. Franchise agreements also allowed bottlers to choose whether or not to market new beverages introduced by the concentrate producer.Some restrictions applied, however, as bottlers could not carry directly competitive brands. For example, a Coca-Cola bottler could not sell Royal Crown Cola, but it could distribute Seven-Up, if it decided not to carry Sprite. Franchised bottlers had the freedom to participate in or reject new package introductions, local advertising campaigns and promotions, and test marketing. The bottlers also had the final say in decisions concerning retail pricing, new packaging, selling, advertising, and promotions in its territory, though they could only use packages authorized by the franchiser.In 1971, the Federal Trade Commission initiated action against eight major CPs, charging tha t exclusive territories granted to franchised bottlers prevented intrabrand competition (two or more bottlers competing in the same area with the same beverage). The CPs argued that interbrand competition was sufficiently strong to warrant continuation of the existing territorial agreements. After nine years of litigation, Congress enacted the â€Å"Soft Drink Interbrand Competition Act† in 1980, preserving the right of CPs to grant exclusive territories. Retail Channels NoIn 2000, the distribution of CSDs in the United States took place through food stores (35%), fountain outlets7 (23%), vending machines (14%), convenience stores (9%), and other outlets (20%). Mass merchandisers, warehouse clubs, and drug stores made up most of the last category. Bottlers’ profitability by type of retail outlet is shown in Exhibit 7. Costs were affected by delivery method and frequency, drop size, advertising, and marketing. The main distribution channel for soft drinks was the superm arket. CSDs were among the five largest selling product lines sold by supermarkets, raditionally yielding a 15%-20% gross margin (about average for food products) and accounting for 3%-4% of food store revenues. 8 CSDs represented a large percentage of a supermarket’s business, and were also a big traffic draw. Bottlers fought for retail shelf space to ensure visibility and accessibility for their products, and looked for new locations to increase impulse purchases, such as placing coolers at checkout counters. The proliferation of products and packaging types created intense shelf space pressures.Do Discount retailers, warehouse clubs, and drug stores accounted about 15% of CSD sales in the late 1990s. These firms often had their own private label CSD, or they sold a generic label such as President’s Choice. Private label CSDs were usually delivered to a retailer’s warehouse, while branded CSDs were delivered directly to the store. With the warehouse delivery m ethod, the retailer was responsible for storage, transportation, merchandising, and stocking the shelves, thus incurring additional costs. The word â€Å"fountain outlets† traditionally referred to soda fountains, but was later used also for restaurants, cafeterias, and other establishments that served soft drinks by the glass using fountain dispensers. 8 Progressive Grocer 1998 Sales Manual Databook, July 1998, p. 68. 4 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century tC Historically, Pepsi had focused on sales through retail outlets, while Coke had dominated fountain sales. Coca-Cola had a 65% share of the fountain market in 2000, while Pepsi had 21%.Competition for fountain sales was intense. National fountain accounts were essentially â€Å"paid sampling,† with CSD companies earning pretax operating margins of around 2%. For restaurants, by contrast, fountain sales were extremely profitable—about 80 cents out of every dollar spent stayed with the restaurant retailers. In 1999, for example, Burger King franchisees were believed to pay about $6. 20 per gallon for Coke syrup, but they received a substantial rebate on each gallon in the form of a check; one large Midwestern Burger King franchisee said his annual rebate ran $1. 45 per gallon, or about 23%. Coke and Pepsi also invested in the development of fountain equipment, such as service dispensers, and provided their fountain customers with cups, point-of-sale material, advertising, and in-store promotions to increase brand presence. After Pepsi entered the fast-food restaurant business with the acquisitions of Pizza Hut (1978), Taco Bell (1986), and Kentucky Fried Chicken (1986), Coca-Cola persuaded other chains such as Wendy’s and Burger King to switch to Coke. PepsiCo spun its restaurant business off to the public in 1997 under the name Tricon, whi le retaining the Frito-Lay snack food business.In 2000, fountain â€Å"pouring rights† remained split along pre-Tricon lines, as Pepsi supplied all of Taco Bell’s and KFC’s, and the overwhelming majority of Pizza Hut restaurants. Coke retained exclusivity deals with McDonald’s and Burger King. No Coke and Cadbury Schweppes handled fountain accounts from their national franchisor companies. Employees of the franchisee companies negotiated and signed pouring rights contracts which, in the case of big restaurant chains, could cover the entire United States or even the world. The accounts were actually serviced by employees of the franchisors’ fountain divisions, local bottlers, or both.Local bottlers, when they were used, were paid service fees for delivering syrup and fixing and placing machines. Historically, PepsiCo could only sell directly to end-user national accounts. By 1999, Pepsi had persuaded most of its bottlers to modify their franchise ag reements to allow Pepsi to sell fountain syrup via restaurant commissary companies, which sell a range of supplies to restaurants. Concentrate producers offered bottlers rebates to encourage them to purchase and install vending machines. The owners of the property on which vending equipment was located usually received a sales commission.Coke and Pepsi were the largest suppliers of CSDs to the vending channel. Juice, tea, sports drinks, lemonade, and water were also available through vending machines. Suppliers to Concentrate Producers and Bottlers Do Concentrate producers required few inputs: the concentrate for most regular colas consisted of caramel coloring, phosphoric and/or citric acid, natural flavors, and caffeine. 10 Bottlers purchased two major inputs: packaging, which included $3. 4 billion in cans, $1. 3 billion in plastic bottles, and $0. 6 billion in glass; and sweeteners, which included $1. 1 billion in sugar and high fructose corn syrup, and $1. billion in artificial sweetener (predominantly aspartame). The majority of U. S. CSDs were packaged in metal cans (60%), then plastic bottles (38%), and glass bottles (2%). Cans were an attractive packaging material because they were easily handled, stocked, and displayed, weighed little, and were durable and recyclable. Plastic bottles, introduced in 1978, boosted home consumption of CSDs because of their larger 1-liter, 2-liter, and 3-liter sizes. Single-serve 20-oz. PET bottles quickly gained popularity and represented 35% of vended drinks and 3% of grocery drinks in 2000. Nikhil Deogun and Richard Gibson, â€Å"Coke Beats Out Pepsi for Contracts With Burger King, Domino’s,† The Wall Street Journal, April 15, 1999. 10 Based on ingredients lists, Coke Classic and Pepsi-Cola, 2001. 5 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 The concentrate producersâ₠¬â„¢ strategy towards can manufacturers was typical of their supplier relationships. Coke and Pepsi negotiated on behalf of their bottling networks, and were among the metal can industry’s largest customers.Since the can constituted about 40% of the total cost of a packaged beverage, bottlers and concentrate producers often maintained relationships with more than one supplier. In the 1960s and 1970s, Coke and Pepsi backward integrated to make some of their own cans, but largely exited the business by 1990. In 1994, Coke and Pepsi instead sought to establish stable long-term relationships with their suppliers. Major can producers included American National Can, Crown Cork & Seal, and Reynolds Metals. Metal cans were viewed as commodities, and there was chronic excess supply in the industry.Often two or three can manufacturers competed for a single contract. Early History11 tC The Evolution of the U. S. Soft Drink Industry Coca-Cola was formulated in 1886 by John Pemberton, a p harmacist in Atlanta, Georgia, who sold it at drug store soda fountains as a â€Å"potion for mental and physical disorders. † A few years later, Asa Candler acquired the formula, established a sales force, and began brand advertising of Coca-Cola. Tightly guarded in an Atlanta bank vault, the formula for Coca-Cola syrup, known as â€Å"Merchandise 7X,† remained a well-protected secret.Candler granted Coca-Cola’s first bottling franchise in 1899 for a nominal one dollar, believing that the future of the drink rested with soda fountains. The company’s bottling network grew quickly, however, reaching 370 franchisees by 1910. No In its early years, Coke was constantly plagued by imitations and counterfeits, which the company aggressively fought in court. In 1916 alone, courts barred 153 imitations of Coca-Cola, including the brands Coca-Kola, Koca-Nola, Cold-Cola, and the like. Coke introduced and patented a unique 6. 5ounce â€Å"skirt† bottle to be used by its franchisees that subsequently became an American icon.Robert Woodruff, who became CEO in 1923, began working with franchised bottlers to make Coke available wherever and whenever a consumer might want it. He pushed the bottlers to place the beverage â€Å"in arm’s reach of desire,† and argued that if Coke were not conveniently available when the consumer was thirsty, the sale would be lost forever. During the 1920s and 1930s, Coke pioneered open-top coolers to storekeepers, developed automatic fountain dispensers, and introduced vending machines. Woodruff also initiated â€Å"lifestyle† advertising for Coca-Cola, emphasizing the role of Coke in a consumer’s life.Do Woodruff also developed Coke’s international business. In the onset of World War II, at the request of General Eisenhower, he promised that â€Å"every man in uniform gets a bottle of Coca-Cola for five cents wherever he is and whatever it costs the company. † Beginnin g in 1942, Coke was exempted from wartime sugar rationing whenever the product was destined for the military or retailers serving soldiers. Coca-Cola bottling plants followed the movements of American troops; 64 bottling plants were set up during the war—largely at government expense.This contributed to Coke’s dominant market shares in most European and Asian countries. Pepsi-Cola was invented in 1893 in New Bern, North Carolina by pharmacist Caleb Bradham. Like Coke, Pepsi adopted a franchise bottling system, and by 1910 it had built a network of 270 11 See J. C. Louis and Harvey Yazijian, The Cola Wars (Everest House, 1980); Mark Pendergrast, For God, Country, and Coca-Cola (Charles Scribner’s, 1993); David Greising, I’d Like the World to Buy a Coke (John Wiley & Sons, 1997). 6 Copying or posting is an infringement of copyright. [email  protected] harvard. du or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century franchised bottlers. Pepsi struggled, however, declaring bankruptcy in 1923 and again in 1932. Business began to pick up in the midst of the Great Depression, when Pepsi lowered the price for its 12-ounce bottle to a nickel, the same price Coke charged for its 6. 5-ounce bottle. When Pepsi tried to expand its bottling network in the late 1930s, its choices were small local bottlers striving to compete with wealthy Coke franchisees. 12 Pepsi nevertheless began to gain market share.In 1938, Coke filed suit against Pepsi, claiming that Pepsi-Cola was an infringement on the CocaCola trademark. The court ruled in favor of Pepsi in 1941, ending a series of suits and countersuits between the two companies. With its famous radio jingle, â€Å"Twice as Much, for Nickel Too,† Pepsi’s U. S. sales surpassed those of Royal Crown and Dr Pepper in the 1940s, trailing only Coca-Cola. In 1950, Coke’s share of the U. S. CSD market was 47% and Pepsi’s was 10%; hundreds of r egional CSD companies continued to produce a wide assortment of flavors. tCThe Cola Wars Begin In 1950, Alfred Steele, a former Coca-Cola marketing executive, became Pepsi’s CEO. Steele made â€Å"Beat Coke† his theme and encouraged bottlers to focus on take-home sales through supermarkets. The company introduced the first 26-ounce bottles to the market, targeting family consumption, while Coke stayed with its 6. 5-ounce bottle. Pepsi’s growth soon began tracking the growth of supermarkets and convenience stores in the United States: There were about 10,000 supermarkets in 1945, 15,000 in 1955, and 32,000 at the peak in 1962.No In 1963, under the leadership of new CEO Donald Kendall, Pepsi launched its â€Å"Pepsi Generation† campaign that targeted the young and â€Å"young at heart. † Pepsi’s ad agency created an intense commercial using sports cars, motorcycles, helicopters, and a catchy slogan. The campaign helped Pepsi narrow Cokeâ€℠¢s lead to a 2-to-1 margin. At the same time, Pepsi worked with its bottlers to modernize plants and improve store delivery services. By 1970, Pepsi’s franchise bottlers were generally larger compared to Coke bottlers.Coke’s bottling network remained fragmented, with more than 800 independent franchised bottlers that focused mostly on U. S. cities of 50,000 or less. 13 Throughout this period, Pepsi sold concentrate to its bottlers at a price approximately 20% lower than Coke. In the early 1970s, Pepsi increased the concentrate price to equal that of Coke. To overcome bottlers’ opposition, Pepsi promised to use the extra margin to increase advertising and promotion. Do Coca-Cola and Pepsi-Cola began to experiment with new cola and non-cola flavors and a variety of packaging options in the 1960s.Before then, the two companies had adopted a single product strategy, selling only their flagship brand. Coke introduced Fanta (1960), Sprite (1961), and lowcalorie Tab (1 963). Pepsi countered with Teem (1960), Mountain Dew (1964), and Diet Pepsi (1964). Each introduced non-returnable glass bottles and 12-ounce metal cans in various packages. Coke and Pepsi also diversified into non-soft-drink industries. Coke purchased Minute Maid (fruit juice), Duncan Foods (coffee, tea, hot chocolate), and Belmont Springs Water.Pepsi merged with snackfood giant Frito-Lay in 1965 to become PepsiCo, claiming synergies based on shared customer targets, store-door delivery systems, and marketing orientations. In the late 1950s, Coca-Cola, still under Robert Woodruff’s leadership, began using advertising that finally recognized the existence of competitors, such as â€Å"American’s Preferred Taste† (1955) and â€Å"No Wonder Coke Refreshes Best† (1960). In meetings with Coca-Cola bottlers, however, executives only discussed the growth of their own brand and never referred to its closest competitor by name. 2 Louis and Yazijian, p,. 23. 13 Pe ndergrast, p. 310. 7 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 During the 1960s, Coke primarily focused on overseas markets, apparently believing that domestic soft drink consumption had neared saturation at 22. 7 gallons per capita in 1970. 14 Pepsi meanwhile battled aggressively in the United States, doubling its share between 1950 and 1970. The Pepsi ChallengeIn 1974, Pepsi launched the â€Å"Pepsi Challenge† in Dallas, Texas. Coke was the dominant brand in the city and Pepsi ran a distant third behind Dr Pepper. In blind taste tests hosted by Pepsi’s small local bottler, the company tried to demonstrate that consumers in fact preferred Pepsi to Coke. After its sales shot up in Dallas, Pepsi started to roll out the campaign nationwide, although many of its franchise bottlers were initially reluctant to join. tC Coke countered with rebates, rival claims, retail price cuts, and a series of advertisements questioning the tests’ validity.In particular, Coke used retail price discounts selectively in markets where the Coke bottler was company owned and the Pepsi bottler was an independent franchisee. Nonetheless, the Pepsi Challenge successfully eroded Coke’s market share. In 1979, Pepsi passed Coke in food store sales for the first time with a 1. 4 share point lead. Breaking precedent, Brian Dyson, president of Coca-Cola, inadvertently uttered the name â€Å"Pepsi† in front of Coke’s bottlers at the 1979 bottlers conference. No During the same period, Coke was renegotiating its franchise bottling contract to obtain greater flexibility in pricing concentrate and syrups.Bottlers approved the new contract in 1978 only after Coke conceded to link concentrate price changes to the CPI, adjust the price to reflect any cost savings associated with a modification of ingredients, and supply unsw eetened concentrate to bottlers who preferred to purchase their own sweetener on the open market. 15 This brought Coke’s policies in line with Pepsi, which traditionally sold its concentrate unsweetened to its bottlers. Immediately after securing bottler approval, Coke announced a significant concentrate price hike. Pepsi followed with a 15% price increase of its own. Cola Wars Heat UpIn 1980, Cuban-born Roberto Goizueta was named CEO and Don Keough president of Coca-Cola. In the same year, Coke switched from sugar to the lower-priced high fructose corn syrup, a move Pepsi emulated three years later. Coke also intensified its marketing effort, increasing advertising spending from $74 million to $181 million between 1981 and 1984. Pepsi elevated its advertising expenditure from $66 million to $125 million over the same period. Goizueta sold off most of the non-CSD businesses he had inherited, including wine, coffee, tea, and industrial water treatment, while keeping Minute Mai d. DoDiet Coke was introduced in 1982 as the first extension of the â€Å"Coke† brand name. Much of CocaCola management referred to its brand as â€Å"Mother Coke,† and considered it too sacred to be extended to other products. Despite internal opposition from company lawyers over copyright issues, Diet Coke was a phenomenal success. Praised as the â€Å"most successful consumer product launch of the Eighties,† it became within a few years not only the nation’s most popular diet soft drink, but also the third-largest selling soft drink in the United States. 14 Maxwell. 15 Pendergrast, p. 323. 8 Copying or posting is an infringement of copyright.[email  protected] harvard. edu or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century In April 1985, Coke announced the change of its 99-year-old Coca-Cola formula. Explaining this radical break with tradition, Goizueta saw a sharp depreciation in the value of the Coca-Cola trademark as â€Å"the product had a declining share in a shrinking segment of the market. †16 On the day of Coke’s announcement, Pepsi declared a holiday for its employees, claiming that the new Coke tasted more like Pepsi. The reformulation prompted an outcry from Coke’s most loyal customers.Bottlers joined the clamor. Three months later, the company brought back the original formula under the name Coca-Cola Classic, while retaining the new formula as the flagship brand under the name New Coke. Six months later, Coke announced that Coca-Cola Classic (the original formula) would henceforth be considered its flagship brand. tC New CSD brands proliferated in the 1980s. Coke introduced 11 new products, including Cherry Coke, Caffeine-Free Coke, and Minute-Maid Orange. Pepsi introduced 13 products, including Caffeine-Free Pepsi-Cola, Lemon-Lime Slice, and Cherry Pepsi.The number of packaging types and sizes also increased dramatically, and the battle for shelf spac e in supermarkets and other food stores grew fierce. By the late 1980s, both Coke and Pepsi offered more than ten major brands, using at least seventeen containers and numerous packaging options. 17 The struggle for market share intensified and the level of retail price discounting increased sharply. Consumers were constantly exposed to cents-off promotions and a host of other supermarket discounts. No Throughout the 1980s, the smaller concentrate producers were increasingly squeezed by Coke and Pepsi.As their shelf-space declined, small brands were shuffled from one owner to another. Over five years, Dr Pepper was sold (all and in part) several times, Canada Dry twice, Sunkist once, Shasta once, and A&W Brands once. Some of the deals were made by food companies, but several were leveraged buyouts by investment firms. Philip Morris acquired Seven-Up in 1978 for a big premium, but despite superior brand rankings and established distribution channels, racked up huge losses in the earl y 1980s and exited in 1985. (Exhibit 8a shows the brand performance of top companies, as ranked by retailers. )In the 1990s, through a series of strategic acquisitions, Cadbury Schweppes emerged as the clear (albeit distant) third-largest concentrate producer, snapping up the Dr Pepper/Seven-Up Companies (1995) and Snapple Beverage Group (2000). (Appendix A describes Cadbury Schweppes’ operations and financial performance. ) Bottler Consolidation and Spin-Off Do Relations between Coke and its franchised bottlers had been strained since the contract renegotiation of 1978. Coke struggled to persuade bottlers to cooperate in marketing and promotion programs, upgrade plant and equipment, and support new product launches. 8 The cola wars had particularly weakened small independent franchised bottlers. High advertising spending, product and packaging proliferation, and widespread retail price discounting raised capital requirements for bottlers, while lowering their margins. Many b ottlers that had been owned by one family for several generations no longer had the resources or the commitment to be competitive. At a July 1980 dinner with Coke’s fifteen largest domestic bottlers, Goizueta announced a plan to refranchise bottling operations. Coke began buying up poorly managed bottlers, infusing capital, 6 The Wall Street Journal, April 24, 1986. 17 Timothy Muris, David Scheffman, and Pablo Spiller, Strategy, Structure, and Antitrust in the Carbonated Soft Drink Industry. (Quorum Books, 1993), p. 73. 18 Greising, p. 88. 9 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 and quickly reselling them to better-performing bottlers. Refranchising allowed Coke’s larger bottlers to expand outside their traditionally exclusive geographic territories.When two of its largest bottling companies came up for sale in 1985, Coke moved sw iftly to buy them for $2. 4 billion, preempting outside financial bidders. Together with other bottlers that Coke had recently bought, these acquisitions placed one-third of Coca-Cola’s volume in company-owned bottlers. In 1986, Coke began to replace its 1978 franchise agreement with the Master Bottler Contract that afforded Coke much greater freedom to change concentrate price. tC Coke’s bottler acquisitions had increased its long-term debt to approximately $1 billion.In 1986, on the initiative of Doug Ivester, who later became CEO, the company created an independent bottling subsidiary, Coca-Cola Enterprises (CCE), and sold 51% of its shares to the public, while retaining the rest. The minority equity position enabled Coke to separate its financial statements from CCE. As Coke’s first so-called â€Å"anchor bottler,† CCE consolidated small territories into larger regions, renegotiated with suppliers and retailers, merged redundant distribution and mater ial purchasing, and cut its work force by 20%. CCE moved towards mega-facilities, investing in 50 million-case production lines with high levels of automation.Coke continued to acquire independent franchised bottlers and sell them to CCE. 19 â€Å"We became an investment banking firm specializing in bottler deals,† reflected Don Keough. In 1997 alone, Coke put together more than $7 billion in deals involving bottlers. 20 By 2000, CCE was Coke’s largest bottler with annual sales of more than $14. 7 billion, handling 70% of Coke’s North American volume. Some industry observers questioned Coke’s accounting practice, as Coke retained substantial managerial influence in its arguably independent anchor bottler. 21 NoIn the late 1980s, Pepsi also acquired MEI Bottling for $591 million, Grand Metropolitan’s bottling operations for $705 million, and General Cinema’s bottling operations for $1. 8 billion. The number of Pepsi bottlers decreased from mo re than 400 in the mid-1980s to less than 200 in the mid-1990s. Pepsi owned about half of these bottling operations outright and held equity positions in most of the rest. Experience in the snack food and restaurant businesses boosted Pepsi’s confidence in its ability to manage the bottling business. In the late 1990s, Pepsi changed course and also adopted the anchor bottler model.In April 1999, the Pepsi Bottling Group (PBG) went public, with Pepsi retaining a 35% equity stake. By 2000, PBG produced 55% of PepsiCo beverages in North America and 32% worldwide. As Craig Weatherup, PBG’s chairman/CEO, explained, â€Å"Our success is interdependent, with PepsiCo the keeper of the brands and PBG the keeper of the marketplace. In that regard, we’re joined at the hip. †22 Do The bottler consolidation of the 1990s made smaller concentrate producers increasingly dependent on the Pepsi and Coke bottling network to distribute their products. In response, Cadbury Sc hweppes in 1998 bought and merged two large U.S. bottlers to form its own bottler. In 2000, Coke’s bottling system was the most consolidated, with its top 10 bottlers producing 94% of domestic volume. Pepsi’s and Cadbury Schweppes’ top 10 bottlers produced 85% and 71% of the domestic volume of their respective franchisors. 19 Greising, p. 292. 20 Beverage Industry, January 1999, p. 17. 21 Albert Meyer and Dwight Owsen, â€Å"Coca-Cola’s Accounting,† Accounting Today, September 28, 1998 22 Kent Steinriede, â€Å"PBG Charts Its Own Course,† Beverage Industry, May 1, 1999. 10 Copying or posting is an infringement of copyright.[email  protected] harvard. edu or 617-783-7860. Adapting to the Times 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century In the late 1990s, a variety of problems began to emerge for the soft drink industry as a whole. Although Americans still drank more CSDs than any other beverage, U. S. sales volume registered only a 0. 2% increase in 2000, to just under 10 billion cases (a case was equivalent to 24 eight-ounce containers, or 192 ounces). This slow growth was in contrast to the 5%-7% annual growth in the United States during the 1980s.Concurrently, financial crisis in various parts of the world left Coke and Pepsi bottlers over-invested and under-utilized. tC Coca-Cola was also impacted by difficulties in leadership transition. After the death of the popular CEO Roberto Goizueta in 1997, his successor Douglas Ivestor had two rocky years at the helm, during which Coke faced a high-profile race discrimination suit and a European public relations scandal after hundreds of people became ill from contaminated soft drinks. Douglas Daft assumed leadership in April 2000; one of his first moves was to lay off 5,200 employees, or 20% of worldwide staff.While expressing â€Å"enthusiastic support for the current strategic course of the Company under Doug Daft’s leadership,à ¢â‚¬  Coke’s Board voted against Daft’s eleventh-hour negotiations to acquire Quaker Oats in November 2000. As they had numerous times over the last century, analysts predicted the end of Coke and Pepsi’s stellar growth and profitability. Meanwhile, Coke and Pepsi turned their attention to bolstering domestic markets, diversifying into non-carbonated beverages (non-carbs), and cultivating international markets.Balancing Market Growth, Market Share, and Profitability in the United States No During the early 1990s, Coca-Cola and PepsiCo bottlers employed a low-price strategy in the supermarket channel in order to compete more effectively with high-quality, low-price store brands. As the threat of the low-priced brands lessened, CCE responded in March 1999 with its first major price increase at the retail level after 20 years of flat take-home pricing. Its strategy was to reposition Coke Classic as a premium brand. PBG followed that price increase shortly after. P rice wars had driven soda prices down to the point where bottlers couldn’t get a decent return on supermarket sales,† explained a Pepsi executive. 23 Observed one industry analyst, â€Å"Coke’s growth is coming internationally, and Pepsi’s is coming from Frito-Lay. It is in the companies’ mutual best interest not to destroy the domestic market and eat up each other’s share. † 24 Consumers’ initial reaction to price increases was a reduction in supermarket purchases. When CCE raised prices in supermarkets by 6. 0%-8. 0% in both 1999 and 2000, comparable volumes in North America declined each year (1. % in 1999 and 0. 8% in 2000). In 2001, however, the bottling companies effected more moderate price increases and consumer demand appeared to be on the upswing. Do Both Coke and Pepsi also set about to boost the flagging cola market in other ways, including exclusive marketing agreements with Britney Spears (Pepsi) and Harry Potter ( Coke). Pepsi reintroduced the highly effective â€Å"Pepsi Challenge,† which was designed to boost overall cola sales and draw consumers away from private labels as much as it was to plug Pepsi over Coke.In contrast to the supermarket channel, Coke and Pepsi’s rivalry in the fountain channel intensified in the late 1990s. To penetrate Coke’s stronghold, Pepsi aggressively pursued national 23 Lauren R. Rublin, â€Å"Chipping Away: Coca-Cola Could Learn a Thing or Two from the Renaissance at PepsiCo,† Barron’s, June 12, 2000. 24 Rublin. 11 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 accounts, forcing Coke to make costly concessions to retain its biggest customers.Pepsi broke Coke’s stronghold at Disney with a 1998 contract to supply soft drinks at the new DisneyQuest, Club Disney and ESPN Zone chains. After a h eated bidding war in 1999 over the 10,000-store chain of Burger King Corporation, Coke again won the fountain contract involving $220 million per year for 40 million gallons of syrup soda, but only after agreeing to double its $25 million in rebates to the food chain. Pepsi also sued Coke over access to the fountain market, charging Coke with â€Å"attempting to monopolize the market for fountain-dispensed soft drinks through independent foodservice distributors throughout the United States. Coke persuaded a Federal court to dismiss the suit in 2000. Despite Pepsi’s efforts, at the end of 2000, Coke still dominated the fountain market with 65% share of national â€Å"pouring rights† to Pepsi’s 21% and Dr Pepper/Seven Up’s 14%. tC The Rise of Non-Cola Beverages As consumer trends shifted from diet soda, to lemon-lime, to tea-based drinks, to other popular non-carbs, Coke and Pepsi vigorously expanded their brand portfolios. Each new product was accompanie d by debate on how much each company should stray from its core product: regular cola.On one hand, cola sales consistently dwarfed alternative beverages sales, and cola-defenders expressed concern that over-enthusiastic expansion would distract the company from its flagship product. Also, history had shown that explosions in demand for alternative drinks were regularly followed by slow or negative growth. On the other hand, as domestic cola demand appeared to plateau, alternative beverages could provide a growth engine for the firms. No By the late 1990s, the soft drink industry had seen various alternative beverage categories come and go.From double-digit expansion in the late 1980s, diet CSDs peaked in 1991 at 29. 8% of the CSD segment and then declined to their 1988-level share of 24. 4% in 1999. PepsiCo’s introduction of Pepsi One in late 1998 was partially responsible for the minor recovery of the diet drink segment. Flavored soft drinks such as citrus, lemon-lime, peppe r, and root beer were also popular. In 1999, Mountain Dew grew faster than any other CSD brand for the third year in a row, posting 6. 0% volume growth, but in 2000, its growth slowed to 1. 5% due to competing â€Å"new-age† non-carbs. DoAt the turn of this century, CSDs accounted for 41. 3% of total non-alcoholic beverage consumption, bottled water accounted for 10. 3%, and other non-carbs accounted for the remainder. 25 When measured in gallons, sales of non-carbs rose by 18% in 1995 and 5% in 2000, compared to 3% and 0. 2% respectively for CSDs. The drinks with high growth and high hype were non-carbs such as juices/juice drinks, sports drinks, tea-based drinks, dairy-based drinks—and especially bottled water. In the 1990s, the bottled water industry grew on average 8. 3% per year, and volume reached more than 5 billion gallons in 2000.Revenue growth outpaced volume growth, with a 9. 3% increase to approximately $5. 6 billion, and per capita consumption gained 5. 1 gallons to 13. 2 gallons per person. Pepsi’s Aquafina went national in 1998. Coke followed in 1999 with Dasani. Though Pepsi and Coke sold reverse-osmosis purified water instead of spring water, they had a distribution advantage over competing water brands. 26 Coke and Pepsi launched other new drinks throughout the 1990s. They also aggressively acquired brands that rounded out their portfolios, including Tropicana (Pepsi, 1998), Gatorade (Pepsi, 5 Maxwell. Does not include â€Å"tap water / hybrids / all others† category. 26 Reverse osmosis is a method of producing pure water by forcing saline or impure water through a semi-permeable membrane across which salts or impurities cannot pass. 12 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century 2000), and SoBe (Pepsi, 2000). Both companies predicted that future increases in market share would come from beverages other than CSDs.Pepsi pronounced itself a â€Å"total beverage company,† and Coca-Cola appeared to be moving in the same direction, recasting its performance metric from share of the soda market to â€Å"share of stomach. † â€Å"If Americans want to drink tap water, we want it to be Pepsi tap water,† said Pepsi’s vice-president for new business, describing the philosophy behind the new strategy. 27 Coke’s Goizueta had echoed the same view: â€Å"Sometimes I think we even compete with soup. †28 Though cola remained the clear leader in terms of both companies’ volume sales, both Coke and Pepsi relied heavily on non-carbs to stimulate their overall growth in the late 1990s.In 1999, non-carbs accounted for 80% of Pepsi’s and more than 100% of Coke’s growth. 29 tC At the turn of the century, Pepsi had the lion’s share of non-CSD sales. Pepsi led Coke by a wide margin in 2000 volume sales in three key s egments: Gatorade (76%) led PowerAde (15%) in the $2. 6billion sports drinks segment, Lipton (38%) led Nestea (27%) in the $3. 5-billion tea-based drinks segment, and Aquafina (13%) led Dasani (8%) in the $6. 0-billion bottled water segment. 30 Including multi-serve juices, Tropicana held an approximate 44% share of the $3-billion chilled orange juice market, more than twice that of Minute Maid. 1 With the acquisition of Quaker and South Beach Beverages, Pepsi raised its non-carb market share to 31%, to Coke’s 19% (see Exhibit 8b). No Non-CSD beverages complicated Coke’s and Pepsi’s traditional production and distribution processes. While bottlers could easily manage some types of alternative beverages (e. g. , cold-filled Lipton Brisk), other types required costly new equipment and changes in production, warehousing, and distribution practices (e. g. , hot-filled Lipton Iced Tea). In many cases, Coke and Pepsi paid more than half the cost of these investments.T he few bottlers that invested in these capabilities either purchased concentrate or other additives from Coke and Pepsi (e. g. , Dasani’s mineral packet) or compensated the franchiser through per-unit royalty fees (e. g. , Aquafina). Most bottlers, however, did not invest in hot-fill (for some iced tea), reverse-osmosis (for some bottled water), or other specialized equipment, and instead bought their finished product from a central regional plant or one owned directly by Coca-Cola or PepsiCo. They would then distribute these alongside their own bottled products at a percentage mark-up.More split pallets32 led to slightly higher labor costs, but otherwise did not significantly affect distribution practices. Despite these complicated and evolving arrangements, higher retail prices for alternative beverages meant that margins for the franchiser, bottler, and distributor were consistently higher than on CSDs. Internationalizing the Cola Wars Do As domestic demand appeared to pla teau, Coke and Pepsi increasingly looked overseas for new growth. Throughout the 1990s, new access to markets in China, India, and Eastern Europe stimulated some of the most intense battles of the cola wars.In many international markets, per capita consumption levels remained a fraction of those in the United States. For example, while the 27 Marcy Magiera, â€Å"Pepsi Moving Fast To Get Beyond Colas,† Advertising Age, July 5, 1993. 28 Greising, p. 233. 29 Bonnie Herzog, â€Å"PepsiCo, Inc. : The Joy of Growth,† Credit Suisse First Boston Corporation, September 8, 2000. 30 Maxwell, p. 152-3. 31 Betsy McKay, â€Å"Juiced Up: Pepsi Edges Past Coke, and It has Nothing to Do With Cola,† The Wall Street Journal, November 6, 2000. 32 Pallets are hard beds, usually of wood, used to organize, store, and transport products.A split pallet carries more than one product type. 13 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783 -7860. Cola Wars Continue: Coke and Pepsi in the Twenty-First Century op y 702-442 average American drank 874 eight-ounce cans of CSDs in 1999, the average Chinese drank 22. In 1999, Coke held a world market share of 53%, compared to Pepsi’s 21% and Cadbury Schweppes’ 6%. Among major overseas markets, Coke dominated in Western Europe and much of Latin America, while Pepsi had marked presence in the Middle East and Southeast Asia (see Exhibit 9). C By the end of World War II, Coca-Cola was the largest international producer of soft drinks. Coke steadily expanded its overseas operations in the 1950s, and the name Coca-Cola soon became a synonym for American culture. Coke built brand presence in developing markets where soft drink consumption was low but potential was large, such as Indonesia: With 200 million inhabitants, a median age of 18, and per capita consumption of 9 eight-ounce cans of soda a year, one Coke executive noted that â€Å"they sit squarely on the equa tor and everybody’s young. It’s soft drink heaven. 33 By the early 1990s, Coke’s CEO Roberto Goizueta said, â€Å"Coca-Cola used to be an American company with a large international business. Now we are a large international company with a sizable American business. †34 No Following Coke, Pepsi entered Europe soon after World War II, and—benefiting from Arab and Soviet exclusion of Coke—into the Middle East and Soviet bloc in the early 1970s. However, Pepsi put less emphasis on its international operations during the subsequent decade. In 1980, international sales accounted for 62% of Coke’s soft drink volume, versus 20% for Pepsi.Pepsi rejoined the international battles in the late 1980s, realizing that many of its foreign bottling operations were inefficiently run and â€Å"woefully uncompetitive. †35 In the early 1990s, Pepsi utilized a niche strategy which targeted geographic areas where per capitas were relatively establis hed and the markets presented high volume and profit opportunities. These were often â€Å"Coke fortresses,† and Pepsi put its guerilla tactics to work, noting that â€Å"as big as Coca-Cola is, you certainly don’t want a shootout at high noon,† said Wayne Calloway, then CEO of PepsiCo. 6 Coke struck back; in one high-profile coup in 1996, Pepsi’s longtime bottler in Venezuela defected to Coke, temporarily reducing Pepsi’s 80% share of the cola market to nearly nothing overnight. In the late 1990s, Pepsi moved even further away from head-to-head competition and instead concentrated on emerging markets that were still up for grabs. â€Å"We kept beating our heads in markets that Coke won 20 years ago,† explained Calloway’s successor, Roger Enrico. â€Å"That is a very difficult proposition. 37 In 1999, PepsiCo’s bottler sales were up 5% internationally and its operating profit from overseas was up 37%. Market share gains were r eported in most of Pepsi-Cola International’s top 25 markets, including increases of 10% in India, 16% in China, and more than 100% in Russia. By 2000, international sales accounted for 62% of Coke’s and 9% of Pepsi’s revenues. Do Concentrate producers encountered various obstacles in international operations, including cultural differences, political instability, regulations, price controls, advertising restrictions, foreign exchange controls, and lack of infrastructure.When Coke attempted to acquire Cadbury Schweppes’ international practice, for example, it ran into regulatory roadblocks in Europe and in Mexico and Australia, where Coke’s market shares exceed 50%. On the other hand, Japanese domestic-protection price controls in the 1950s greased the skids for Coke’s high concentrate prices and high profitability, and in India, mandatory certification for bottled drinking water caused several local brands to fold. 33 John Huey, â€Å"The World’s Best Brand,† Fortune, May 31, 1993. 34John Huey, â€Å"The World’s Best Brand,† Fortune, May 31, 1993. 5 Larry Jabbonsky, â€Å"Room to Run,† Beverage World, August 1993. 36The Wall Street Journal, June 13, 1991. 37 John Byrne, â€Å"PepsiCo’s New Formula: How Roger Enrico is Remaking the Company†¦ and Himself,† BusinessWeek, April 10, 2000. 14 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. 702-442 op y Cola Wars Continue: Coke and Pepsi in the Twenty-First Century To cope with immature distribution networks, Coke and Pepsi created their own ground-up, and often novel, systems.Coke introduced vending machines to Japan, a channel that eventually accounted for more than half of Coke’s Japanese sales. 38 In India, Pepsi found the most prominent businessman in town and gave him exclusive distribution rights, tapping his connections to drive growth. Significantly, b oth Coke and Pepsi recognized local-market demands for non-cola products. In 2000, Coke carried more than 200 brands in Japan alone, most of which were teas, coffees, juices, and flavored water.In Brazil, Coke offered two brands of guarana, a popular caffeinated carbonated berry drink accounting for one-quarter of that country’s CSD sales, despite rivals’ TV ads ridiculing â€Å"gringo guarana. † tC When the economy foundered in certain parts of the world during the late 1990s, annual consumption declined in many regions. Major financial quakes in East Asia in 1997, Russia in 1998 and Brazil in 1999 shook the cola giants, who had invested heavily in bottler infrastructure. From 1995 to 2000, Coke’s top line slowed to an average annual growth of less than 3%.Profits actually fell from $3. 0 billion in 1995 to $2. 2 billion in 2000. In Russia, where Coke invested more than $700 million from 1991 to 1999, the collapse of the economy caused sales to drop by a s much as 60% and left Coke’s seven bottling plants operating at 50% capacity. In Brazil, its third-largest market, Coke lost more than 10% of its 54% market share to low-cost local drinks produced by family-owned bottlers exempt from that country’s punitive soft-drink taxes. In 1998, Coke estimated that a strong dollar cut into net sales by 9%.Pepsi, with its relatively lower overseas presence, was less affected by the crises. Nonetheless, Pepsi also subsidized its bottlers while experiencing a drop in sales. No Despite these financial setbacks, both Coke and Pepsi expressed confidence in the future growth of international consumption and used the downturn as an opportunity to snatch up bottlers, distribution, and even rival brands. To increase sales, they tried to make their products more affordable through measures such as refundable glass packaging (instead of plastic) and cheaper 6. ounce bottles. The End of an Era? At the turn of the century, growth of cola sales in the United States appeared to have plateaued. Coke and Pepsi were investing hundreds of millions of dollars to shore up international bottlers operating at low capacity. The companies’ overall growth in soft drink sales were falling short of precedent and of investors’ expectations. Was the fundamental nature of the cola wars changing? Would the parameters of this new rivalry include reduced profitability and stagnant growth— inconceivable under the old form of rivalry? DoOr, were the troubles of the late 1990s just another step in the evolution of two of America’s most successful companies? In 2001, non-cola, non-carbs, and even convenience foods offered diversification and growth potential. Low international per capita soft drink consumption figures hinted at tremendous opportunity in the competition for worldwide â€Å"throat share. † Noted a Coke executive in 2000, â€Å"the cola wars are going to be played now across a lot of different ba ttlefields. †39 38 June Preston, â€Å"Things May Go Better for Coke amid Asia Crisis, Singapore Bottler Says,† Journal of Commerce, June 29, 1998, . A3. 39 Betsy McKay, â€Å"Juiced Up: Pepsi Edges Past Coke, and It has Nothing to Do With Cola,† The Wall Street Journal, November 6, 2000. 15 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. Do Exhibit 1 702-442 Copying or posting is an infringement of copyright. [email  protected] harvard. edu or 617-783-7860. No U. S. Industry Consumption Statistics 1970 1975 1981 1985 1990 1992 1994 1995 1996 1998 1999 2000 Historical Carbonated Soft Drink Consumption Cases (millions) Gallons/capita As a % of total beverage consumption 3,090 22. 7 2. 4 3,780 26. 3 14. 4 5,180 34. 2 18. 7 6,500 40. 3 22. 4 7,914 46. 9 26. 1 8,160 47. 2 26. 3 8,608 50. 0 27. 2 8,952 50. 9 28. 1 9,489 52. 0 28. 8 9,880 54. 0 30. 0 9,930 53. 6 29. 4 9,950 53. 0 29. 0 22. 7 22. 8 18. 5 35. 7 6. 5 5. 2 1. 3 1. 8 26. 3 21. 8 21. 6 33 1. 2 6. 8 7. 3 4. 8 1. 7 2 34. 2 20. 6 24. 3 27. 2 2. 7 6. 9 7. 3 6 2. 1 2 40. 3 24. 0 25. 0 26. 9 4. 5 7. 8 7. 3 6. 2 2. 4 1. 8 46. 9 24. 3 24. 2 26. 2 8. 1 8. 8 7. 0 5. 4 2. 0 1. 5 47. 2 23. 3 23. 8 26. 5 8. 2 9. 1 6. 8 5. 4 2. 0 0. 6 1. 4 50. 0 22. 8 23. 2 23. 3 9. 6 9. 4 7. 1 4. 8 1. 7 0. 9 1. 3 50. 9 22. 3 22. 8 1. 3 10. 1 9. 5 6. 8 4. 9 1. 8 1. 1 1. 2 52. 0 22. 3 22. 7 20. 2 11. 0 9. 7 6. 9 4. 8 1. 8 1. 1 1. 2 54. 0 22. 1 22. 0 18. 0 11. 8 10. 0 6. 9 4. 7 2. 0 1. 3 1. 3 53. 6 22. 2 21. 9 17. 2 12. 6 10. 2 7. 0 4. 6 2. 0 1. 4 1. 3 53. 0 22. 2 21. 7 16. 8 13. 2 10. 4 7. 0 4. 6 2. 0 1. 5 1. 2 114. 5 126. 5 133. 3 146. 2 154. 4 154. 3 154. 0 152. 6 153. 6 154. 1 153. 8 153. 6 68 56 49. 2 36. 3 28. 1 28. 2 28. 5 29. 9 28. 9 28. 4 28. 7 28. 9 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 182. 5 U. S. Liquid Consumption Trends (gallons/capita) Carbonated soft drinksBeer Milk Coffeea Bottled Waterb Juices Teaa Powder ed drinks Wine Sports Drinksc Distilled spirits Subtotal Tap water/hybrids/all others Totald tC opy Source: John C. Maxwell, Beverage Digest Fact Book 2001, and The Maxwell Consumer Report, Feb. 3, 1994; Adams Liquor Handbook, casewriter estimates. aFrom 1985, coffee and tea data are based on a three-year moving average to counter-balance inventory swings, thereby portraying consumption more realistically. bBottled water includes all packages, single-serve, and bulk. cSports drinks included in â€Å"Tap water/hybids/all others† pre-1992. This analysis assumes that each person consumes on average one-half gallon of liquid per day. -16- Cola Wars Continue: Coke and Pepsi in the Twenty-First Century Advertisement Spending for the Top 10 CSD Brands ($ millions) op y Exhibit 2 Share of market 2000 Total market 20. 4 13. 6 8. 7 7. 2 6. 6 6. 3 5. 3 2. 0 1. 7 1. 1 1999 20. 3 13. 8 8. 5 7. 1 6. 8 3. 6 5. 1 2. 1 1. 8 1. 1 Advertisement Spendinga per 2000 2000 1999 share point 207. 3 13 0. 0 1. 2 50. 5 84. 0 83. 6 0. 5 44. 5 NA 2. 7 148. 9 91. 1 25. 5 37. 1 68. 4 71. 3 0. 8 39. 2 NA 2. 9 tC Coke ClassicPepsi-Cola Diet Coke Mountain Dew Sprite Dr Pepper Diet Pepsi 7UP Caffeine Free Diet Coke Barq’s root beer Total top 10 702-442 72. 9 72. 9 10. 2 9. 6 0. 1 7. 0 12. 7 13. 3 0. 1 22. 3 NA 2. 4 604. 2 485. 2 8. 3 707. 6 650. 0 NA Source: â€Å"Top 10 Soft-Drink Brands,† Advertising Age, September 24, 2001; casewriter estimates. aAdvertisement spending measured in 11 media channels from CMR. Brands and total market in 192-oz cases from Do No Beverage Digest/Maxwell. Case volume from all channels. 17 Copying or posting is an infringement of copyright. [email  protected] arvard. edu or 617-783-7860. 702-442 Cola Wars Continue: Coke and Pepsi in the Twenty-First Century U. S. Soft Drink Market Share by Case Volume (percent) 1966 op y Exhibit 3 1970 1975 1980 1985 1990 1995 1998 2000E 27. 7 1. 5 1. 4 2. 8 33. 4 28. 4 1. 8 1. 3 3. 2 34. 7 26. 2 2. 6 2. 6 3. 9 35. 3 2

Health Informantion Exchange Essay Example | Topics and Well Written Essays - 250 words

Health Informantion Exchange - Essay Example change information regarding health care services, patients’ case histories, patients’ advocacy rights, state and federal laws regarding health care, and data integrity. This needs a â€Å"standardized interoperable model that is patient centric, trusted, longitudinal, scalable, sustainable, and reliable† (American Health Information Management Association, para.2), and that follows HIM principles. The aim behind the implementation of HIE is to improve the quality of delivery of health care information and services, by ensuring the safety of patients’ data and accuracy of information being shared. Healthcare costs are also reduced (Utah Health Information Network, para.2), since the system is quick and error prone. Terry (para.2) mentions a report conducted by Doctors Helping Doctors Transform Healthcare and the American College of Physicians, which states that a large number of clinicians believe that HIE will have a good effect on health care delivery, c are coordination, care organizations, medical homes, third-party reporting, incentive programs, practice efficiency, and reduction of healthcare costs. However, the biggest challenge in medical settings is the lack of HIE infrastructure and lack of interoperability between EHRs and other electronic information exchange systems. Terry, Ken. â€Å"Most Doctors Want Health Information Exchange Now.† Healthcare Information Week. UBM Tech, 2012. Web. 19 Dec 2012.

Multiculturalism and cultural policy in Scandinavia Essay

Multiculturalism and cultural policy in Scandinavia - Essay Example As a prescriptive phenomenon, it refers to settlement policy that works towards promoting the perspective of institutionalizing cultural diversity. This paper expounds on this concept of multiculturalism and cultural diversity, with Sweden being a case study (CRAFT, 2011). Sweden has a reputation of having the most immigration policies in Europe. Behind such an image, their lies a more complicated reality. The current transformations are turning the explicit commitments regarding multiculturalism towards a cultural suppression that tends to conceal the power structure underlying ethnic, gender, racial, and the class inequalities (TCHIBOZO, 2013). As compared with Britain, and many other European nations, some of the multiculturalism paradoxes have been largely examined. This was established through critical reassessment of the dominant institutional, academic, and political discourses (TCHIBOZO, 2013). They tend to focus on changes with regards to the refugee policies, the representation of the immigrant youths and women, as well as the limited voice accorded to the contemporary social movements and the immigrant communities. In the course of discussing the kind of dilemma that is faced by welfare state especially under the localization and globalizat ion threats, a greater focus has been redirected on the perspective of trans-ethnicity. Doing so, exposes the necessity for the more comprehensive description of politics, state, class, everyday life, and the civil society (CRAFT, 2011). With regards to the international comparison, the Swedish nationalism has perhaps been relatively calm, but nevertheless, there were stronger assimilating pressures that were put on both the immigrant communities and the traditional minorities (CRAFT, 2011). Rather than the ethno-nationalist fanaticism, there was a greater elementary ideology of integrating the members of cultural and ethnic minorities into the

Congressional Representation Research Paper Example | Topics and Well Written Essays - 1250 words

Congressional Representation - Research Paper Example Moreover, ideology, policy preferences and the nature of information received etc can also affect the Congressmen while they vote. In short, â€Å"congressional voting on specific bills is correlated with the economic self-interest of the representative's constituents and a measure of the representative's ideology† as indicated by his broader voting record†(Bender, 1991, p.1) This paper briefly analyses various reasons why congressmen vote the way they do, and how their constituencies at times play a large role in that. The role of Hannah Pitkin’s theory; substantive vs. descriptive representation in controlling the voting behaviour of the Congressmen is also analysed in this paper. Factors which influence Congressmen while they vote Fellow Congressmen can influence a Congressman very much while he takes decisions upon certain topic. Fellow congressmen can act as the source of lots of information which may influence the Congressman while he takes decision about a particular topic. In most of the cases, Congressmen may engage in mutual discussion both in and out of the office and that also formally and informally. All these discussions will bring lot of new information which may affect the decision making process of the Congressmen. ... Thus fellow congressmen have wider influence on the decision making abilities of a particular congressman. The influence of Constituent is another major factor which controls the voting of the Congressmen. â€Å"The constituency imposes some meaningful constraints on Congressmen’s voting behaviour†(Kingdon, 1989, p.68). Moreover, â€Å"a basic principle of representative democracy is that elected officials must pay homage to their districts if they wish to secure reelection† (Crespin, n. d. p.2).It is difficult for congressmen to sacrifice the interests of the people in their constituencies since they need the support of the people for their re-election. In other words, a congressman who has planned to seek re-election should vote in accordance with the interests of the people in their constituencies. Only on issues that the constituency doesn't feel strongly, the Congressman may think of taking an independent decision. Ultimately, the congressmen have the moral responsibility or liability to explain his stands to the people in his constituencies since the people are the ones who elected him. Party leadership and the committee members can also influence the decision making or the voting of the congressmen. â€Å"The degree of party cohesions affects the voting behaviour of the congressmen†(Froman, 1963, p.57). Each party may have a well defined stand on all policy matters. In most of the cases, the congressmen vote in favour of his party’s stands. However, in many cases, congressmen take stands which are different from that of his party. For example, many democrats opposed Obama’s healthcare reform bill along with the republicans. If the president is popular in the constituency, the congressman will extend greater support to the policies of the