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Analyzing the strategy of product differentiation through packaging sizes by soda companies
Product differentiation through packaging sizes allows soda companies like Coke to reach a wider customer base and increase sales. By simply changing the size of the bottles or cans, companies can target different customer segments without creating new products. In Latin America, Coke successfully implemented this strategy, offering different sizes for various customer groups such as big families, the middle class, and individuals on-the-go. This approach also enabled price discrimination, allowing the company to charge more to customers willing to pay premium prices. The success in Latin America led Coke to expand this strategy globally in the mid-2000s. While soda companies in the U.S. traditionally differentiated themselves based on brand and flavor, Coke shifted its focus to leveraging new package sizes as a key strategy to drive sales growth.