Product vs. Service War: What Next? A Case Study of Japanese Beverage Industry Perspective

Products, services or servitization concept; nothing is new anymore to the marketer these days. Historically, it is observed that the development of market has been shifting from one-phase to another phase in every 10 years. Since 1950s to the 1990s, the market experts have changed their focus from the production of goods to quality of products, selling to marketing approach, and products maintenance to service orientation respectively. In mid 2000s, the Japanese beverage industry has realized a big change, while many leading companies were diversified their business-focus and entered into rivals’ core business segments. As a result, the marketplace is quickly flooded as same category products and services-integration concept became spotlight to the marketer in the beginning of 2010s. However, today the services offer by soft drinks manufacturer cannot alone differentiate the firm from its rivals that pressure them to re-think its business strategy and finding new mechanisms for long-term sustainability. Therefore, this paper aims to examine the current market situation more precisely, identifying value deficiencies, and proposes a conceptual “Relationship Business Model”. Data was collected from three top leading Japanese beverage firms namely, Coca-Cola, Suntory, and ITO EN limited (CSI). The firms’ answer to a survey included multiple choices and open questions about the current market situation, challenges, and key factors for future business success, and so on.