STRATEGIC MARKETING Group Presentation
Nov 04, 2014
STRATEGIC MARKETING Group Presentation
Overview of Indian Market- Past
• In the year 1991, the Indian Government adopted Economic Liberalization Policy
• “Cold Drinks” as popularly known in India were an Urban phenomenon and the favorites (soda based) were Campa Cola, Gold Spot, Limca and Thums Up
• Pepsi entered in the Indian Market as Pepsi Foods Ltd. and was known as Lehar Pepsi
• Coke tried to reenter* in 1990 by merging with Godrej but was denied; merged with Britannia Industries India Ltd.
• July 1993 Parle sold its brands and plants to Coke
*Coke was present in India from 1970’s, but was banned in 1977 under FERA
Overview of Indian Market- Present
• Today the Indian Market for Carbonated Drinks is worth more than Rs.17000 crore
• The present scenario of the carbonated drinks market is duopoly* situation.
• Although in every place there are local competitors and there is a huge unorganized flavored water market.
• As far as the carbonated drinks are concerned there are only two brands (as per the Market Share).
– Coke (57.8%)
– Pepsi (35.6%)
*A duopoly is a competitive situation where there are two competitors, normally of roughly equal size.
Coca-Cola
BACKGROUND
Coca- Cola Milestones
• 1886: Founded by John Pemberton
• 1887: Registered as trademark.
• 1895: Sold in every state & territory in US.
• 2003: Headquartered in Atlanta with divisions & local operations in over 200 countries worldwide. 70% income outside US.
• 1970s: Entered Indian Market for the 1st time
• 1977: Exited the Indian Market
• 1993: Re-entry in India
• 1993-2003 : Invested more than US $1b in India- top international investor.
• 2003-2008: No. 1 soft drink company in India.
Coca- Cola Products in India
• Coke
• Diet Coke
• Thums Up
• Sprite
• Limca
• Maaza
• Fanta
• Georgia (Coffee)
• Kinley (Drinking Water)
PepsiCo.
BACKGROUND
Pepsi Co. Milestones
• 1899: Founded by Caleb Bradham
• 1902: Applied for trademark in US
• 1923: Declared bankrupt & assets sold
• 1985: Gained entry in India
• 1988* - Succeeded with Pepsi Food India Limited Project as a joint venture of Punjab Agro Industrial corporation & Voltas India Limited.
• 1991: Marketed & sold as Lehar Pepsi.
• 1994: Bought out its partner and become a fully owned subsidiary.
• Today it is the No. 2 soft drink company in India.
• *In 1988, forced to withdraw from market due to carcinogenic ingredient (BVO)
Coca- Cola Products in India
• Pepsi
• Diet Pepsi
• 7 Up
• Miranda
• Mountain Dew
• Tropicana Juices
• Lays, Cheetos & Ruffles (Snacks)
• Quaker Oats
• Aquafina (Drinking Water)
Battle between two giants
RIVALRY
FEATURES: COKE PEPSI
Bar weight 10 FL OZ ( 200ml) 10 FL OZ ( 200ml)
Calories 121.25 150
Carbohydrates (gm) 33.75 34.5
Flavors (numbers) 2 2
Price/bottle Rs 10 Rs 10
PRODUCT CLAIMS All foods and beverage can fit into healthy
balanced diet when consumed in appropriate
proportion.
Offers beverages that resorts to the
customer’s expectations and make it more
enjoyable for them to lead healthier lives.
TARGET CONSUMER Children, adults, younger generation and
sports personality and celebrities
People from younger generation, sports
personalities and celebrities
DISTRIBUTION Grocery stores, retail stores, shops, malls, etc. Grocery stores, retail malls, shops etc.
BRAND POSITIONING Sweetened carbonated drink Sweetened carbonated drink.
Competitor Capabilities Matrix
Differential Competitor Analysis
COKE PEPSI
PARENT COMPANY Coca Cola Company Pepsi Co
TOTAL SALES 450 million ( globally) 324.58 million (globally)
PRODUCTS Coca Cola , Diet Coke Pepsi, Diet Pepsi
MANAGEMENT Atul Singh (CEO) Indra K Nooyi (CEO)
LATEST PRODUCT None None
DISTRIBUTION Through retail malls, grocery shops , organized
and unorganized retails
Through retail malls, grocery shops, organized and unor
SPONSORSHIP Various events such as cricket matches, movies,
trade faires, college fests etc.
Sports events, trade faires,college fests etc.
PRODUCTION Company produces syrup concentrate which it
sells to bottlers through out the world
Contains carbonated water,high fructose corn
syrup,sugar, colorings, phosphoric acid, caffeine, citric
acid and natural flavours
FOUNDER Originated in 1886 in US by Dr.John S Pemberton Originated in North Carolilna by a young pharmacist
New Bern
MARKET SHARE 57.8% 35.6%
BRAND AMBASSADOR Imran Khan, Sachin Tendulakar Mahendra Singh Dhoni, Ranbeer Kapoor
NUMBER OF BOTTLING PLANTS 26( company owned), 14 (franchise owned) 15( company owned), 28( franchise owned)
Product
Product Type Coca-Cola Pepsi Co.
Carbonated Drinks (Black) Coke, Thums Up Pepsi
Carbonated Drink (Black) Diet Diet Coke Diet Pepsi
Carbonated Drinks (Orange) Fanta Miranda
Carbonated Drinks (Clear/ Lemon) Sprite, Limca 7 Up, Mountain Dew
Flavored Juice Maaza Tropicana
Coffee Georgia ***
Drinking Water Kinley Aquafina
Snacks *** Lays, Cheetos & Ruffles
Breakfast *** Quaker Oats
Place
Place
• Both Pepsi and Coke follow the Hub and Spoke model of distribution in rural India.
HUB Spoke
Village
Village
Village
Spoke
Village
Village
Village
Rural
Place
Coke
• Sales & Distribution is handled by a large number of bottlers.
• 26 bottling plants
• 60 distribution centres
• 20 contract packers
• Over 70000 retail outlets serviced via trucks, converted three wheelers, tricycles & push carts.
• 300 million soft drink consumers
Pepsi Co. • Pioneer in use of Vending
Machines and Restaurant, Departmental Stores
• Built up distribution network & bought out a lot of Bottlers
• Production plants and bottling centers were strategically placed in large cities all around India
• Focusing on the rural
• PepsiCo has 37 bottling plants in India, including 17 company-owned plants and 20 owned by franchisee partners
Price
Coke • Earlier COST BASED Pricing.
• The Rs. 5 (200 ml) and Rs. 8 (300 ml) marketing revolution
• Coke spends more on advertising than manufacturing
Pepsi Co.
• Competition based
• Very flexible to come down with the price very quickly
Promotion
Coke
• Brand Localization Strategy: The Two India’s
• India A: “Life ho to aisi”
• India B: “Thanda Matlab Coca-Cola”
• Small bottle scheme
Pepsi Co. • Pepsi balance 2 influences in the
minds of the customers:
• ‘You’re cool the way you are’
• ‘Don’t try to be any different’
• It was positioned as the new cool youth icon
• ‘Nothing Official About It’
• ‘Yeh Dil Maange More’
• ‘Mera Number Kab Ayega?’
• ‘Yeh Pyaas Hai Badi’
• ‘Youngistan’
• ‘Change the game’
Promotion
Coke Pepsi Co.
SWOT Analysis: Coke STRENGTHS • Well established Global Brand • Prior knowledge of Indian market
(1958-1977) • Tie up with local players (Britannia
Ltd) • Strong Fiscals to acquire local business
(bottling plants/local brands)
WEAKNESS
• Improper appreciation of existing Indian Laws at entry time (in case of acquisition, 49% sale of equity to local partners mandatory)
OPPORTUNITIES • Many successful brands to pursue • Advertise its less popular products • Buy out competition.
• More Brand recognition
THREATS • Strong Competition from Pepsi and
other local brands due to late entry • Stricter legal framework (49% equity
to Indian Investors) • Decreasing popularity of carbonated
drinks in India
SWOT Analysis: Pepsi Co.
STRENGTHS • International Brand and Global
Experience • Benefitted by learning from Coca
Cola mistakes in India pre 1977 • Willingness to comply with
stringent Indian Laws
WEAKNESS • Lack of Experience in Indian market
OPPURTUNITIES • Food division should expand • Noncarbonated drinks are the
fastest-growing part of the industry • There are increasing trend toward
healthy foods • Focus on most important customer
trend - "Convenience".
THREATS • Unfriendly political environment
and Indian legal framework • Competition from local
manufacturers • Low demand in Indian market for
carbonated drinks • Poor infrastructure especially in
rural India
Consumer Segmentation
Behavioral
Benefits sought: Thirst quencher; status symbol
Purchase Occasion: Parties and other get-togethers
Purchase Behavior: Instinctive/ Planned
Usage: Light, occasional
Perceptions and beliefs: Safe and stylish; preferred cola drink
Psychographics
Lifestyle: Trendy; Sophisticates
Personality: Cool; Youthful
Profile
Demographic: Urban, Rural
Socio Economic: Young affluent Indians
Geographic: Urban & Rural India
Segmenting Consumer Markets for Pepsi & Coke
Model for Brand Equity for Pepsi & Coke
Advertising: • TV: Yougistan with MTV • TV: MTV Coke Studio • Billboards • Posters • Radio
Sales Promotion: • Scratch cards • Lucky Draws • Buy1, get 1 free • Change to smaller
packaging
Event Experience: • Musical Concert Shows • Sponsorship Sports events • Tying up with TV Soaps
Word of Mouth Marketing: • No Systematic effort to
generate word of mouth marketing
Digital Marketing: • High Impact through digital
and social Media marketing
PR & Publicity: • Bollywood, cricket brand
ambassador • Sponsorship of Indian
cricket team and world cup
Marketing Communication
Programs
Brand Equity
Brand Image: • Youthful • Cool • Rebellious • Refreshing
Brand Awareness: • Exists across market • High awareness in urban
areas in comparison to rural areas
Brand Relationship: • Very low Brand Loyalty • Subject to availability and
price
Brand Equity for coke!
The most recognized word on the planet after “OK”!
Advertising Campaign
Coke was the official partner for 1996 world cup!
Coke used to advertise its brand as an official partner
and then….
More Youth Centric
More Emotional
Product Mix- BCG Matrix – Pepsi Co.
Stars: • Pepsi • Mountain Dew • Tropicana Juices
Question Mark: • Diet Pepsi • Miranda • 7 Up • Nimbooz
Cash Cow: • Aquafina
Dogs: • Pepsi Max
Relative Market Share
Ma
rket
Gro
wth
ra
te
H
L
H L
Product Mix- BCG Matrix - Coke
Stars: • Coke • Sprite
• Diet Coke
Question Mark: • Fanta • Georgia • Minute Maid
Cash Cow: • Thumps up • Limca • Maaza • Kinley
Dogs:
Relative Market Share
Ma
rket
Gro
wth
ra
te
H
L
H L
Ansoff model for Coke
Product Development: • “Cold Drinks” as popularly known in
India were an Urban phenomenon and the favorites (soda based) were Campa Cola, Gold Spot, Limca and Thums Up
• July 1993 Parle sold its brands and plants to Coke
Market penetration/ Expansion: • Family sized bottle • Pet Bottles • Small Quantity at low price for rural
market
Market Development: • Diet Coke - result of a growing trend
towards dieting and healthier living • Vanilla Coke - an alternative to Coke • Fanta Icy Lemon
Diversification: • Coca Cola developed the energy drink
‘Powerade’ in response to growth in the sports drink market.
• Georgia (Coffee)
Products
Ma
rket
E
N
E N
Ansoff model for Pepsi
Product Development: • Pepsi – Entered into an existing cola
market competing with local brands and coke – Existent Cash cow
Market penetration/ Expansion: • Diet Pepsi – Entered into an existing
market created by Diet coke – Existent Dog
Market Development: • Pepsi blue – Seasonal product that
took advantage of cricket world cup fever – not produced anymore
• Follower
Diversification: • Pepsi Max – Advertised through digital
media • Pepsi Caffechino – Pepsi’s attempt to
create a niche market for cola + Coffee Taste - Unsuccessful
Products
Ma
rket
E
N
E N
Pepsi & Coke: Three Levels of a Product
Freezers to ensure cold products, Free Branding for small outlets, Water bottles, Indian cricket
team, Celebrities, Merchandise
Non Alcoholic Cold Drinks, Thirst Quencher, Modern & Inspirational
Sweet Carbonated cola Size: 200ml, 300ml, 500ml, 1.5 ltr, 2ltr.
Glass bottles, Cans, Pet bottles Blue, Red, White
Low
High
Ability to standardized
Product element
Support Service
Product Attributes
Core Product Benefits
Current and Future Strategies
COKE PEPSI
OBJECTIVES To refresh the world.
To inspire moments of optimism and
happiness.
To create value and make a
difference.
To be the world’s premier consumer
products company focused on
convenient foods and beverages.
CURRENT
STRATEGIES
Product innovation and huge
spending on advertisement, cross
training of mangers.
More risk taking ability, rapid action
with respect to changing market
condition, finding new opportunities
for new market.
FUTURE STRATEGIES Extensive spending on market
research in order to determine the
tastes and preferences of the
customers, CSR, product innovation,
adoption of green revolution,
product line extensions.
Product line extensions, CSR, Brand
extensions, product innovations, sound
R&D department to develop products
as per the tastes and preferences of
the customers.
Giants Fight to get maximum share
Conclusion
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