Marketing Strategy of Pepsico

ACKNOWLEDGEMENT:-(Submitted on: 27th September 2010)

Despite the great work that has been done, first of all I would like to thank GOD and my Parents without whose cooperation and motivation, morally and financially, this project couldn’t be completed. I would like to acknowledge this research report to my sincere teachers without whom, I would not have been able to compile this report.

CONTENT:-1

MARKETTING INTRODUCTION

COMPANY’S INTRODUCTION

MARKETTING MIX

MARKET SEGMENTATION

LINE EXTENSION

BRAND EXTENSION

POPULAR SLOGANS

COMPETITORS

MARKET RESEARCH ON INDIVIDUALS

MARKETING INTRODUCTION:-

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“Marketing deals with identifying and meeting human and social needs. One of the shortest definitions of marketing are “meetings needs profitably.” The 21st century is the era of Advertising, Marketing and Sales Production; Marketing is to convert social needs into profitable opportunities. As it is said “Marketing thinking starts with the human needs and wants”. Apart from basic necessities of air, water, shelter and clothing, every person has strong desire for recreation and entertainment. They have strong preference for particular brand of basic and services. Marketing serves as the link between the society’s needs and its pattern of Industrial response. Beverage industry is one of the fast growing industries in India. We can divide Beverages into two sections i.e. Alcoholic & Non-alcoholic. The non-alcoholic drinks are soft drinks that can be further classified Cola, Lemon, Orange, Mango and Apple segment.

COMPANY’S INTRODUCTION:-

HISTORICAL BACKGROUND

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Born in the Carolinas in 1898, Pepsi-Cola and rich history. The drink is the

invention of Caleb Brad ham, a pharmacist and drugstore owner in New Bern,

North Carolina. In the late 1890's, he had been experimenting with Coca and

Kola extracts in the syrup form. By mixing this syrup with carbonated water, he

produced a very pleasing beverage that not only tasted good but also made his

customers and friends feel good. He promoted it as a cure of indigestion. Initially

called Brads Drink by his local friends, the drink was formally titled PEPSI COLA

in 1898. By 1902 the syrup was so popular that Caleb was devoting most of time in

the preparation, packaging, marketing, advertising, and overseeing the distribution

of it to other pharmacies. His sales increased rapidly and in1904 he bought the

Bishop Mill and converted it into his bottling plant for Pepsi Cola. In 1907, he

purchased adjoining land and built a three-story addition to the factory to serve as

office space for his new company.

By the end of 1909 Caleb Brad ham had 250 franchises in 24 different states,

his businesses continued to grow till 1920 when volatile sugar prices caused the

beginning of the rapid decline in his fortune. Bankruptcy was declared in March,

1923 and the PEPSI formula passed through the series of folding company’s until

1931, when Loft Candy Company in New York purchased it. In 1934, Pepsi began

offering twice as much soft drink for the same 5-cent price and sales soared. In

the1960s, Pepsi targeted young adults calling them “Pepsi Generation”. First Can

Pepsi and Diet Pepsi were also introduced during the same lime, which went all

over the world. Then the Frito Lay and Pepsi Cola merged to become Pepsi

Company Corporation. After the 100 years of establishment, Pepsi is still making

efforts to retain its standards and its impression throughout the world. Pepsi scored

its biggest sales in soft drinks but enjoying its large profits in snack foods.

MARKETING MIX :-The tools of marketing mix are combined in such a manner that they give maximum mileage to the product from the factory to the consumer’s hand.

Product

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Price

Place

Promotion

PRODUCT

People satisfy their needs and wants with products and services, a product is

anything that can be offered to a market to satisfy a need or want- The concept of

product is not limited to physical objects - anything capable of satisfying a need

can be called a product. Haidri Beverages is the company that has taken up the

franchise to produce Pepsi for the area of Maharashtra and Delhi. The production

capacity of the plant is to produce 73,000 cases of 24 bottles of 250-ml. For this

reason the company has three lines of production to fulfill the ever-growing

demand. Pepsi is one of the core products of the organization and the company

puts in a lot of effort to retain its image through its highly professional team. The

members of the organization work day and night making every possible effort to

attain the organizational goals.

PRICE

Price is the amount of money the customers are willing to pay to obtain that

particular product. Providing quality products at the lowest possible price had

always been one of the main concerns of Pepsi. One of the ways by which the

company has been able to assist this effort is by increasing the use of inexpensive

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and recyclable plastic bottles. The government policy, at times, makes a lot of

difference as the government may increase the freight charges, the prices of glass,

or the prices of steel. Thus the overall price of the product also gets affected. The

price of Pepsi Cola is very reasonable as compared to other drinks and the

management makes every effort to make the product at the lowest possible cost but

the highest quality.

Pepsi wants its product to be available to all PRICING STRUTCTURE:-

QUANTITY PRICE

200 ML 9

300 ML 12

330 ML(CAN) 20

500 ML 23

1 LIT 35

2 LIT 60

PLACEPlace includes the company activities that make the product available to target consumers. Pepsi Cola is placed in the market according to the extent of the target market located in that particular geographical area. Haidri Beverages place their product in the market with the help of its indirect distribution network. The retail stores are spread all around the franchised area in order to ensure the availability of the product all the year round. The major retail stores located in Maharashtra and

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Delhi are in the Blue Area, Jinnah Super Market, Super Market, and in almost every sector of Islamabad. The entire DELHI Cantonment and the entire city as well have many retail outlets where Pepsi is available in abundance. The distribution network also works according to the promotional campaign or the season. For example, in the cricket season the company tries to make the product available in areas where Cricket is being played.

Pepsi covers almost 95% of total area.

It sells through local retailers.

It is available everywhere.

PROMOTION

Promotion means activities that communicate the merits of the product in order to persuade the target customers to buy it. Promotion plays a vital role in the success or failure of a product. Promotion of the right product at the right time is an ideal situation for a company. Pepsi is one of those products on which the franchisers spend millions of Dollars/Rupees for its promotion. Haidri Beverages invest a huge amount of money on the promotional campaigns of Pepsi. There are different ways of promoting a product through retailing, personal selling, and advertising. The company strongly emphasizes on advertisements as the other two methods area not much effective in attracting the attention of their target audience. Huge amount of money spend on advertisement on T.V, Magazines, And Banners. It sponsor’s award function’s and sports activities.

MARKET SEGMENTATION:-

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Dividing a market into distinct groups of buyers with different needs,

characteristics, or behavior who might require separate products or marketing

mixes. Marketers consist of buyers and buyers differ in one or more ways. They

may differ in their wants, resources, locations, buying attitudes, and buying

practices. Through market segmentation companies divide large, heterogeneous

markets into smaller segments that can be reached more efficiently with products

and services that match their unique needs.

MARKET SEGMENTATION OF THE PRODUCT PEPSI COLA IN INDIA:

GEOGRAPHIC SEGMENTATION The company of Pepsi Cola is used to segment the market of the product geographically by focusing their market and attention towards the urban areas and in the hot summer days because people are interested in spending 9 rupees in getting a good reasonable drink, which gives them pleasure and reduces their thirst. They have their dealers in Different places in the urban areas to capture the market in order to find and satisfy their customers.

DEMOGRAPHIC SEGMENTATION

First of all the company considers every one young in the market because they

consider 5 year old boy as young and 70 year old man as young because they think

that no one in the world consider himself as an aged person but the company in

some case focuses their market and segments their market up to the age from 5

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years to age 45, because people above 45 are hesitant of drinking Pepsi due to its

coolness and its sugar factors. People in between the age 5 to 45 are usually

attracted towards the drink Pepsi due to its flavor and reputation in the market. The

company also made area wise segmentation and usually moves towards college,

cinemas, restaurants, hotels, where the strength of young people are greater. The

company also focuses towards students of colleges and schools.

PSYCHOGRAPHIC SEGMENTATION

The company also segments its market with respect to social class, lifestyles and

personalities, they focuses their attention towards lower upper and middleclass

because those people afford to drink Pepsi.

BEHA V IORAL SEGMENTATION

Behavioral segmentation is benefits, occasions; brand loyalty etc. The Company

tries to market their product for the occasions like weddings, concerts and sports

events. Now days the demand of Pepsi Cola has increased due to the wedding

ceremonies. So the company tries to attract the customers in such Metropolitan

areas. It also focuses towards the Brand loyal people or the people who are heavy

user of Pepsi Cola. And those people are in the colleges and universities.

LINE EXTENSION :- Pepsi

Pepsi blue

Pepsi twist

Diet Pepsi

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Caffeine free Pepsi

Pepsi max

BRAND EXTENSION :-

Beverages

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PepsiCo India’s expansive portfolio includes iconic refreshment beverages Pepsi, 7 UP, Nimbooz, Mirinda and Mountain Dew, in addition to low calorie options such as Diet Pepsi, hydrating and nutritional beverages such as Aquafina drinking water, isotonic sports drinks - Gatorade, Tropicana100% fruit juices, and juice based drinks – Tropicana Nectars, Tropicana Twister and Slice. Local brands – Lehar Evervess Soda, Dukes Lemonade and Mangola add to the diverse range of brands.

Foods

PepsiCo’s food division, Frito-Lay, is the leader in the branded salty snack market and all Frito Lay products are free of trans-fat and MSG. It manufactures Lay’s Potato Chips, Cheetos extruded snacks, Uncle Chipps and traditional snacks under the Kurkure and Lehar brands. The company’s high fibre breakfast cereal, Quaker Oats, and low fat and roasted snack options enhance the healthful choices available to consumers. Frito Lay’s core products, Lay’s, Kurkure, Uncle Chipps and Cheetos are cooked in Rice Bran Oil to significantly reduce saturated fats and all of its products contain voluntary nutritional labeling on their packets.

POPULAR SLOGANS :-

2006-2007

Yeh PYAAS Hai BADI!!

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2007-2008

Yeh DIL Mange MORE!!

2008-2009

Yeh hai Youngistaan Meri Jaan!!

2010

Yeh Hai Youngistaan Ka WOW!!

CompetitorsCoke v/s Pepsi-Product

As seen above both the companies Coke and Pepsi have a

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Coke Pepsi

The main dark cola drink of the company

which started the rivalry between these

companies.

Pepsi version of dark cola which is the major primary

competitor to Coke.

F u l l T h r o t t l e i s a n e n e r g y d r i n k b r a n d p r o d u c e d

b y T h e C o c a -C o l a C o m p a n y .

I t d e b u t e d i n l a t e 2 0 0 4 i n

N o r t h A m e r i c a .

A M P i s a n e n e r g y d r i n k p r o d u c e d a n d d i s t r i b u t e d b y P e p s i C o u n d e r t h e M o u n t a i n

D e w s o f t d r i n k b r a n d .

V a u l t i s a c a r b o n a t e d

b e v e r a g e t h a t w a s r e l e a s e d b y T h e C o c a - C o l a

C o m p a n y i n J u n e 2 0 0 5 .

M o u n t a i n D e w M D X i s a n

e n e r g y d r i n k m a n u f a c t u r e d

a n d d i s t r i b u t e d b y P e p s i C o u n d e r t h e

M o u n t a i n D e w b r a n d . I t w a s i n t r o d u c e d i n

2 0 0 5 .

number of products . Many of these products a re innovat ions but there are a lso many products which are brought out jus t as a compet i t ive product for the o ther companies . Some of these products tha t a re brought in the market by both the companies to compete agains t each o ther a re as fo l lows:

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D i e t C o k e o r D i e t C o c a - C o l a i s a s u g a r - f r e e D i e t P e p s i i s a l o w - c a l o r i e c a r b o n a t e d c o l a . I t

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P o w e r a d e i s a s p o r t s d r i n k b y T h e C o c a -C o l a C o m p a n y a n d c u r r e n t l y n u m b e r t w o i n

t h e s p o r t s d r i n k m a r k e t w o r l d w i d e .

G a t o r a d e i s a n o n - c a r b o n a t e d s p o r t s d r i n k m a r k e t e d b y Q u a k e r O a t s C o m p a n y , a d i v i s i o n o f P e p s i C o . O r i g i n a l l y m a d e f o r a t h l e t e s , i t i s

n o w o f t e n c o n s u m e d a s a s n a c k b e v e r a g e .

S p r i t e i s a c l e a r , l e m o n - l i m e f l a v o r e d , n o n -c a f f e i n a t e d s o f t d r i n k , p r o d u c e d b y t h e

C o c a - C o l a C o m p a n y . I t w a s i n t r o d u c e d t o t h e U n i t e d S t a t e s i n 1 9 6 1 .

7 Up is a brand of a lemon-lime flavored soft drink.

M i n u t e M a i d i s a p r o d u c t l i n e o f b e v e r a g e s , u s u a l l y a s s o c i a t e d w i t h o r a n g e j u i c e , b u t

n o w e x t e n d s t o s o f t d r i n k s o f m a n y k i n d s . T h e M i n u t e M a i d c o m p a n y i s n o w o w n e d b y

C o c a - C o l a , a n d i s t h e w o r l d ' s l a r g e s t m a r k e t e r o f f r u i t j u i c e s a n d d r i n k s . I t i s

h e a d q u a r t e r e d i n H o u s t o n , T e x a s .

T r o p i c a n a P r o d u c t s i s a n A m e r i c a n c o m p a n y b a s e d i n B r a d e n t o n , F l o r i d a , U S A , w h i c h i s

o n e o f t h e w o r l d ' s l a r g e s t p r o d u c e r s a n d m a r k e t e r s o f o r a n g e j u i c e . I t h a s b e e n o w n e d

b y P e p s i C o , I n c . s i n c e 1 9 9 8 .

s o f t d r i n k p r o d u c e d a n d d i s t r i b u t e d b y T h e C o c a - C o l a C o m p a n y . I t w a s i n t r o d u c e d i n

t h e U n i t e d S t a t e s i n J u l y 1 9 8 2 .

w a s i n t r o d u c e d i n 1 9 6 4 a s a v a r i a n t o f P e p s i -C o l a w i t h n o s u g a r .

K i n l e y i s a b r a n d o f s t i l l o r c a r b o n a t e d w a t e r o w n e d b y T h e C o c a - C o l a C o m p a n y .

Aquafina is a non-carbonated bottled water produced by PepsiCo.

MARKET RESEARCH ON INDIVIDUALS:-

ARE YOU AWARE OF PEPSI?

YES NO

WHAT WAS THE SOURCES OF AWARENESS?

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ADVERTISEMENTWORD OF MOUTHSAW IN SHOPOTHERS

WHICH SOFT DRINK DO YOU PREFER OTHER THAN PEPSI?

THUMPS UPCOKEOTHERS

HOW FREQUENTLY DO YOU PURCHASE PEPSI?

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DAILYWEEKLYMONTHLY

WHAT IS THE AVAILABILITY OFPEPSI AT YOUR NEAREST RETAILERS?

HIGHLOWRARE

WHICH FACTOR AFFECTS YOUR PURCHASE OF PEPSI?

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ADVERTISEMENTATTRACTIVE DISPLAYOCCASSIONS

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