One: Competition is one of the most inevitable forces in today’s business world. Companies are seeking ways to gain a competitive advantage over competitors. Competitive advantage enables companies to differentiate themselves and their products, to create superior value for its customers and to serve them better than its competitors (Al Badi, 2018). While formulating a strategy, companies will evaluate the strategies of its competitors. Analyzing competitors helps to discover its weaknesses as well as identify opportunities and threats in the industry (Abraham, 2006). Three are many strategies used to evaluate competition in the market. One strategy is the formulation of a Competitive Profile Matrix (CPM).

Coca-Cola is amongst one of the leading soda beverage brands in the industry with a portfolio of over 500 beverage brands. Like most companies, Coca-Cola is faced with implementing strategic plans and evaluating its competitors. Pepsi Co. has been one of Coca-Cola’s primary competitors since the late 19thcentury. Their products are very similar in ingredients and taste. Dr. Pepper is a major competitor of Coca-Cola also. Dr. Pepper has a portfolio of more than 50 brands. In recent years, Dr. Pepper has made a series of strategic acquisitions to grow its business and customer base. Although Coca-Cola has several competitors, the company still has brand recognition and a loyal customer base.

Competitive Profile Matrix (CPM)

As explained in our text, the Competitive Profile Matrix (CPM) reveals how a company compares to its major competitors across a range of key factors (David et. al., 2019, p. 83). Managers often use CPM as a valuable tool to differentiate the competition within an industry. The CPM provides the necessary information of competitive advantage based on key success factors and serves as the foundation for a company’s strategy (Zimmerer, Scarborough, & Wilson, 2008). CPM’s can assist managers in making strategic decisions.

The following table shows a summary of Coca-Cola’s CMP in comparison to its major competitors, Pepsi and Dr. Pepper. The CPM highlights the critical success factors which are key areas which must be performed at the highest possible level of excellence if company’s want to succeed in a particular industry (Zimmerer et. al., 2008). The critical success factors are factors that are either viewed by the customer as valuable or which provide the firms a significant advantage in the market. The critical success factors are weighted based upon relative importance.

Coca-Cola

Pepsi

Dr. Pepper

Critical Success Factors

Weight

Rating

Score

Rating

Score

Rating

Score

Advertising

0.14

4

0.56

4

0.56

3

0.42

Global Expansion

0.12

4

0.48

3

0.36

2

0.24

Financial Position

0.10

4

0.40

3

0.30

3

0.30

Product Quality

0.11

4

0.44

4

0.44

4

0.44

Customer Loyalty

0.12

3

0.36

4

0.48

2

0.24

Brand Reputation

0.11

4

0.44

4

0.44

3

0.22

Price Competiveness

0.15

3

0.45

3

0.45

4

0.60

Market Share

0.15

4

0.60

3

0.45

2

0.30

Total

1.0

3.73

3.48

2.76

The CPM analysis reveals that Coca-Cola is the stronger competitor in the industry. The relevant strengths for Coca-Cola include: advertising, global expansion, financial position, and market share. It is also important to note that Pepsi has a greater strength in customer loyalty. Dr. Pepper is ranked third overall. However, the company has a competitive advantage in their product prices.