CASE: Dr Pepper/Seven Up, Inc

Introduction

Dr Pepper/Seven Up, Inc is the largest division of Cadbury Schweppes PLC that is the third largest soft drink companies and fourth largest confectionary company that sells its products in over 200 countries. Also, this company is the largest non cola soft drink company in the North America, and the third largest soft drink company in the United States. They are rated among first 10 companies based on their product share. However, some of their products represent a market leader in specific categories.

Market situation

In the United States there are more than 900 registered brand names for carbonated soft drink. Most of these brands are recognized and accepted in the local regions and they mostly represent the taste of the local consumers.

Taste of the locals are changing over time and where there were just colas taste was accepted in the past; in the last decade there is significant growth (30%) in popularity of flavored soft drinks. Flavors such as orange, cherry, grape, lemon lime are much more represented in the market.

For the purpose of soft drink production there are three groups of participants in the chain production. These are: concentrate producers, bottlers, and retail outlets. Three major concentrate producers in the United States are Coca Cola Company, Pepsi Cola Company, and Dr Pepper/Seven Up, Inc. However, there are more than 500 bottlers that also convert flavor concentrate into carbonated soft drinks, but the three biggest concentrate producers also owned companies that provide them with the bottles. Retail channels used for carbonate soft drinks are supermarkets, stores, vending machines, mass merchandisers and thousands of small retailers. Three companies together represent over 90 percent of the carbonate soft drinks in the United States. Coca cola takes more than 44,1% of the market