They started introducing new products with various packaging and sizes and both the companies

countered each other with aggressive marketing efforts by doubling their advertising spending and
acquiring independent franchised bottlers. Besides, the packaging strategies helped them to boost
up their sales in competitive market.

Carbonated soft drinks have always been in demand since the 1970s and have
continued to gain popularity and increased consumption over the years( Exhibit 1).
Besides, the brand’s gross margins of CSDs have been around 70% whereas for
other products these margins are comparatively much lower( Exhibit 10) which help
the companies to fetch huge profits. 
Furthermore, to get an overall…… we did Porter’s 5 forces analysis:

THREAT OF NEW ENTRANTS: high - Most dominant force

CocaCola and Pepsi occupied the major market share in the CSD industry with
effective control over nationwide bottlers and retail channels gaining exclusive
geological territories through franchise agreements for manufacturing, distribution
and sales; and pushing the product to customers through low prices, large variety
and extensive promotional activities. Such huge investment in acquiring nation's top
suppliers, major territories and aggressive marketing such as high & easy
accessibility of product in supermarket, fast-food chains pushed other
regional/local/new firms to enter out of US due to the need for high initial capital
investment intensifying their risk for entering with already existing fierce rivalry
between Pepsi and Coke and their loyal customer base for a decade. 
Even setting up a bottling plant was cost-intensive and the strategic moves of
dominant players (acquiring bottling plants) intimidated new entrants. 
The Carbonated soft drink industry accounted for 4% of total sales from stores in the
US, where the majority of sales were from super markets. Bottlers fought for shelf
space to ensure their product visibility as they were offering different product
varieties of CSD , so it would create intense competition for new entrants to create
their products visibility in the leading stores.