Please read the syllabus for the details of how to do this assignment (and how not to do it). This document only has the question you must answer in your paper.
Question:
Coca-Cola headquarters has decided that the future looks bad for company profits. They predict that the carbonated soft drinks market will see a decline in revenues, and an increase in costs, as consumers decide to drink less soft drinks and governments will regulate sales by imposing heavy taxes or even outright banning the sale of soft drinks to children.
In response to this assessment, Coca-Cola has announced it will no longer be at “war” with Pepsi-Cola. It will unilaterally cut its advertising, marketing, and promotion costs by 50% next year. It will spend most of its advertising, marketing, and promotions budget in emerging countries that could still have high future growth. In the United States and other established markets Coca-Cola will spend very little money supporting the Coke brand or its products.
Will this significant cut in spending lead to a better or worse competitive advantage for CocaCola in the next one to three years, and why?
