PROJECT REPORT ON MARKETING RESEARCH WITH REFERENCE TO PEPSICO Submitted in Partial Fulfillment for the Award of the Degree of Bachelor in Business Administration 2010-2012 Under the Guidance of: Submitted By: Mrs. Sanam Sharma Jyotsna Duggal Faculty of Financial market BBA (GEN) SEC-B, IIIrd Semester, IInd Shift Enrollment no.13961101709
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PROJECT REPORT
ON
MARKETING RESEARCH WITH REFERENCE TO PEPSICO
Submitted in Partial Fulfillment for the Award of the
Degree of Bachelor in Business Administration 2010-2012
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
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
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 24
1 LIT 37
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 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.
ABOUT THE SOFT DRINK
Soft drink has been part of American lifestyle for more than 100 years. Many of today’s soft drinks are the same as the first ones enjoyed in the 1800’s. Soft drink production begins with creation of flavored syrup using a closely guarded company recipe. The syrup is mixed with purified water and then carbonated by adding carbon dioxide gas under pressure. This carbonation creates the “tingle fizz” that gives soft drinks a refreshing taste.
Now for a closer look at soft drink ingredients……………
Like other foods, the ingredients that are used in making soft drink are approved and closely regulated by the US Food and Drug Administration (FDA). All the ingredients used in soft drinks are found in a variety of other foods.
WATERSoft drink production starts with a pure source of water. Regular soft drink
contains 90% water while diet soft drink contains up to 99% water Drinking water contains trace amount of various elements that affect its taste. You have probably noticed that top differ in carious regions of the county. Bottler use sophisticate filtering and other treatment equipments to remove any residual impurities and to standardize the water used to make soft drinks. That’s why your favorite soft drink tastes the name in New York as it dies in India.
CARBON DIOXIDEA colorless and odorless gas, carbon dioxide is the essential characterizing
ingredient in all “carbonated” beverages. It is given off when we breathe and is used by the plants to product oxygen.
When dissolved in water, carbon dioxide imparts taste. For that reason natural sources of carbonated. Of effervescent, mineral water were once highly prized. These rare mineral water were once also believed to have beneficial medicinal properties. Efforts to make and sell “artificial effervescent mineral water” underway Europe and US by 1800.
It was the innovative step of adding flavors to these popular “soda water” that gave birth to the soft drink beverages we enjoy today. In these days of soft drink manufacturing, carbon dioxide was made from sodium salts. This is why carbonated beverages were called, sodas or “soda water”.
Today bottlers buy pure carbon dioxide as a compressed gas in the high-pressure cylinders. Carbon dioxide gas is absorbed into flavored soft drink in a carbonator machine just before the container is sealed. While under pressure and chilled, soft drink may absorb up to four times the beverage volume of carbon dioxide.
FLAVORSOne of the most important ingredients in the soft drinks is flavoring. Most soft drink bottles mix many individual flavors to create distinctive tastes. Natural
flavors in the soft drink come from spices, natural extracts and oils. Fruit –flavored soft drink such as orange and lemon-lime often contains natural fruit extracts. Other flavors such as root beer and ginger are contain flavoring made from herbs and spices.
There are also some artificial or man made flavoring used in soft drinks. Nature does not produce enough of some flavors to satisfy world demand. Also some flavors are limited geographically and seasonally.
COLORSMany people do not realize important color is to taste perception. Color
affects our psychological impression of food. If you don’t believe it. Try eating a familiar food in the dark. The color used in the food and beverages comes both from natural and synthetic sources.
CAFFEINE Caffeine is substance that occurs naturally in more than 60 plants including
coffee beans, tealeaves, kola nuts and cocoa beans. In some cases, small amounts of caffeine are added to soft drinks as a part of the flavor profile. The amount of caffeine in soft drinks is only a fraction of that found in an equal amount of coffee or tea.
Caffeine has a classic bitter taste that enhances other flavors. It has been part of almost every cola and pepper type beverage since they were first formulated more than 100 years ago and has been enjoyed in coffee, tea and chocolate beverages for centuries.
Even though some people feel the effects of caffeine are harmful, scientific research has refused these claims. The ling history of caffeine’s use confirms that it is safe when consumed in moderation. For people who wish to restrict their caffeine intake, many caffeine free soft drinks are available.
ACIDULANTS Similar to fruit juices and many other food products, most drinks are slightly
acidic. Acidulates add a pleasant tartness to soft drinks for one or two common food acidulates (phosphoric acid and citric acid) occasionally; other acidulates such as malice acid is also used.
PRESERVATIVESoft drinks do not normally get spoiled because of their acidity and
carbonation. However, storage conditions and storage tome can sometimes impact taste and flavor. For this reason some vs. contains small amounts of preservatives that are commonly used in many foods.
POTASSIUM Potassium is another essential nutrients found in many natural and man made food ingredient like sodium, potassium exists naturally in drinking water and
therefore, in soft drinks. Small amount of potassium are also found in some of the flavoring agents and other ingredients used in soft drinks.
SODIUM Because the name “soda pop” and “soda water” were associated with early
soft drinks. Many people falsely believe that carbonated beverages contains significant amount of sodium. That is true.
Sodium, the name form of various salts, is present in many natural and man made compounds. It is an essential nutrient responsible for regulating and transferring body fluids. As well as other important body functions. Although an adequate daily intake of sodium is necessary for good health, excessive consumption has been to high blood pressure in some people.
SWEETENERS Non-diet soft drinks
Most regular (non-diet) soft drinks are sweetened with either sucrose or high fructose corn syrup, (HFCS). A mixture of these sweeteners many also be used. Sucrose, the familiar sweetener in your sugar bowl, cines firm sugarcane or sugar beets.
SOFT DRINKS CAN BE MADE BY FOLLOWING STEPS -
1START WITH PURE WATER!
Soft drinks begin with purified water (much clearer than the tap water you drink at home). The soft drink manufacturer filters tap water through fine, clean sand and gravel to get rid of any undissolved impurities that may pass through the finished drink and ensures that the water does not contain any unwanted particles.
2ADD THE FLAVOUR
Once the water is purified, flavourings are added. These are prepared from natural and nature identical sources and are added to a mixture of sugar and purified water to make a syrup. This forms the soft drink base.
3NEXT STEP, ADD THE BUBBLES
The purified water and syrup base are then blended together to form a 'still' drink and then mixed with carbon dioxide gas (CO2) in a machine called a carbonator.
4FILLING THE BOTTLES
After the drink has been carbonated, it is transferred under pressure to the filling machine. Here, the bottles or cans are filled and are then passed by conveyor belt to the sealing machine.
5THE FINAL STAGE
The sealed bottles and cans are still quite cold at this stage, and if packed at this temperature, moisture which forms on the container because of condensation would cause the cartons to become wet and less manageable. To prevent this, the bottles and cans are passed through a hot water spray to bring them up to 'room' temperature.
6LABELS & PACKAGING
Most soft drink bottles have labels applied by a labeling machine. There are still some bottles, mostly returnable, which have the label information printed directly on to the glass. Cans also have the label printed on them, before they arrive at the soft drink manufacturing plant.
HEALTH WITH PEPSI
PepsiCo India stays committed to the health and well-being of children. It will continue to provide children with a healthy and fun portfolio while simultaneously tackling the 'calories out' side of the equation by expanding its Get Active programme for kids.
PepsiCo India believes that in order to build its business in a sustainable manner, it has a responsibility to ensure that its consumers are nourished in multiple dimensions. PepsiCo India has been proactive in taking a variety of steps to sustain and strengthen this platform of human sustainability.
PepsiCo's diverse portfolio
PepsiCo’s diverse portfolio reflects its commitment to
provide consumers with a diverse range of fun and healthy products, making the healthy choice an easier choice. As PepsiCo grows, the portfolio transformation will continue with a systematic plan to reduce added sugar, sodium and saturated fats in its products. Today, the portfolio includes several healthier treats and some hydrating and nourishing products.
Tropicana 100 % juice range that provides essential nutrition and vitamins. Tropicana nectars and juice based drinks – Tropicana Twister, Slice and Slice Mangola.
Products with reduced sugar or calories such as Diet Pepsi and 7UP Light Gatorade, the worlds leading sports drink, has valuable re-hydration
benefits and is scientifically formulated to quench thirst, replace fluids and electrolytes and provide carbohydrate energy.
Aquafina packaged water and bulk water Breakfast cereal, Quaker Oats, which is rich in soluble fibre, beta-glucan,
Vitamin B complex and helps in lowering cholesterol
Improving core products
Frito Lay’s core products, Lay’s Kurkure, Uncle Chipps and Cheetos are cooked in Rice Bran Oil to significantly reduce the saturated fat in these brands by 40%
The nutritious Lehar Lite range of snacks contains 25% less oil The Lehar “roasted” line of namkeens uses oil sparingly in its products and
only in the seasoning Frito Lay’s products are MSG and trans-fat free and contain on pack
voluntary nutritional labeling
Offering Portion Choices: Most of PepsiCo’s products are available in a range of packages e.g small packs, so consumers can select a size suited to particular occasions and dietary needs.
Promoting active lifestyles to kids: Another key effort lies in tackling the ‘calories out’ side of the equation by encouraging active lifestyles especially for school going children. PepsiCo has initiated the Get Active programme that promotes active lifestyles and healthy nutritional habits among children in approximately 120 schools located in Delhi and Mumbai.
Calories Out - Getting Active!
One of the ways to battle the growing issue of obesity is to tackle the 'calories out' side of the equation by encouraging active lifestyles especially for school going children.
Launched in 2006, Get Active is a partnership between PepsiCo India and Swashrit Society, an NGO. The programme currently covers 1,00,000 children enrolled in 120 schools in Mumbai and Delhi.
Through the Get Active programme, PepsiCo's snack and beverage businesses collaborate with the National Advisory Board - comprising medical practitioners, nutritionists and public health policy experts - to work towards our vision of improving the health and well-being of our children. The Get Active programme promotes active lifestyles and healthy nutritional habits among children in schools.
In 2007, a Get Active seminar was organised by Swashrit to facilitate a discussion between leading NGOs, principals and representatives from CBSE on how to incorporate an essential balance of physical activities into school curriculums. This first of its kind seminar reflected PepsiCo's commitment to spreading awareness and creating a holistic network of professionals working in areas relevant to this issue.
If SWOT analysis does not start with defining a desired end state or objective, it runs the risk of being useless. A SWOT analysis may be incorporated into the strategic planning model. An example of a strategic planning technique that incorporates an objective-driven SWOT analysis is SCAN analysis. Strategic Planning, including SWOT and SCAN analysis, has been the subject of much research.
Strengths: attributes of the organization that are helpful to achieving the
objective.
Weaknesses: attributes of the organization that are harmful to
achieving the objective.
Opportunities: external conditions that are helpful to achieving the
objective.
Threats: external conditions which could do damage to the business's
performance.
Identification of SWOTs is essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs.
First, the decision makers have to determine whether the objective is attainable, given the SWOTs. If the objective is NOT attainable a different objective must be selected and the process repeated.
Following SWOT analysis is based on the researcher’s observation of the market while conducting the research and project’s data analysis. This information does not come within the preview of the research.
SWOT analysis of PepsiCo:
Strength: Pepsi has a broader product line and the outstanding reputation.
Merger of the Quaker Oats produced synergy across the board.
Record revenues and the increasing market share.
Lack of capital constraints
Great brands, strong distribution and innovative capabilities
Number one maker of snacks, such as corn chips and the potato chips
PepsiCo sells its three products through the same distribution channel.
For example, combining the production capabilities of the Pepsi, Gatorade and Tropicana is
a big opportunity to reduce the costs, improve efficiency and smooth out the impact of the
seasonal fluctuations in demand for the particular product.
Weakness:
Pepsi hard to inspire vision and the direction for large global company.
Not all the PepsiCo products bear the company name
PepsiCo is far away from the leader Coca-cola in the international market demand
is highly elastic.
Opportunity:
Food division should be expand internationally
Noncarbonated drinks are fastest-growing part of the industry
There are increasing trend toward the healthy foods
Focus on the most important customer trend - "Convenience".
Threats:
F&B industry is now mature
Pepsi is blamed for pesticide residues in their products in one of their most
promising emerging market like in India
Over 50% of the company's sales come from Frito-Lay; this is a threat if the market
takes a downturn
PepsiCo now competes with the Cadbury Schweppes, Coca-Cola, and Kraft foods
(because of broader product line) which are well-run and the financially sound
competitors.
Size of the company will demand a varied marketing program; Social, cultural,
economic, political and governmental constrains.
PEST Analysis:
The PEST analysis examines changes in a marketplace caused by Political, Economical,
Social and Technological factors.
P: Political change, from one party to another in control- for example the rise in private
healthcare and the privatizations under Conservative governments.
Political Analysis for Pepsico
Non-alcoholic beverages fall within the food category under the FDA. The government
plays a role within the operation of manufacturing these products in terms of the
regulations. There are potential fines set by the government on companies if they do not
meet the standard of laws.
The following are some of the factors that could cause pepsico company's actual results to
differ materially from the expected results described in their underlying company's
forward statement are:-
Changes in laws and regulations, including changes in the accounting standards,
taxation requirements, and environmental laws in domestic or foreign jurisdictions.
Changes in the non-alcoholic business environment. These include, without
limitation, competitive product and the pricing pressures and their ability to gain or
maintain share of sales in the global market as a result of action by competitors.
Political conditions, especially in the international markets, including civil unrest,
government changes and restrictions on the ability to transfer capital across
borders.
Their ability to penetrate the developing and emerging markets, which also
depends on the economic and political conditions, and how well they are able to
acquire or form strategic business alliances with local bottlers and make the
necessary infrastructure enhancements to the production facilities, distribution
networks, sales equipment and technology.
E: Economic change, for example a recession creating increased activity at the lower ends
of the product price ranges. Rate of interest rises depressing business and causing
redundancies and lower spending level.
Economic Analysis for pepsico
Last year the U.S. economy was the strong and nearly every part of it was growing and
doing well. However, things changed. Most economists loosely define a recession as the two
consecutive quarters of contraction, or negative GDP growth. On Monday 26, the
government officially declared that the U.S. has been in recession since March.
However, because of the aggressive action by the Federal Reserve and the Congress it will
be short and mild. The economy will return to the sustained, positive growth in the first
half of 2002.
Future Outlooks
The Federal Reserve is doing all that it can help the economy to recover. They have
cut the interest rate ten times in this year. The rate now lies at a 40-year low of
2.1%. Lowering the interest rates will ultimately excite consumer demand in the
economy. Companies will expand and increase use of debt as a result of the low
borrowing rate. Pepsico can borrow money for investing in some other product as
the interest rates are low. It can use the borrowing on the research of new products
or technology. As researching for new products would cost less the pepsico
Company will sell its products for less and the people will spend as they would get
cheap products from the pepsico.
Before the attacks on September 11, 2001, the US was starting to see the economy
recover slightly and it is only just recently that they achieved economic levels.
Consumers are now the resuming their normal habits, going to the malls, car
shopping, and eating out at restaurant. However, many are still handling their
money cautiously. They believe that with the lower inflation still to come,
consumers will recover their confidence over the next year.
The non-alcoholic beverage industry has high sales in countries outside the U.S.
According to the Standard and Poor's Industry surveys,"For major soft drink
companies, there has been the economic improvement in the many major
international markets, such as Japan, Brazil, and Germany." These markets will be
continue to play a major role in the success and the stable growth for a majority of
the non-alcoholic beverage industry.
S: Social change involves changing attitudes and the lifestyles. The increasing number of
women going out to work, for example, led to the need for the time-saving products for the
home.
Social Analysis for pepsico
Many U.S. citizens are practicing healthier the lifestyles. This has affected the non-
alcoholic beverage industry in that many are switching to the bottled water and diet
colas instead of beer and other alcoholic beverages. Also, time management has
increased and is at the approximately 43% of all households. The need for the
bottled water and other more convenient and healthy products are in important in
the average day-to-day life.
Consumers from the ages of 37yr-55yr are also increasingly concerned with the
nutrition. There is a large population of the age range known as the baby boomers.
Since many are the reaching an older age in life they are becoming more concerned
with the increasing their longevity. This will continue to affect the non-alcoholic
beverage industry by increasing demand overall and in the healthier beverages.
T: Technological change - creates opportunities for new products and the product
improvements and of course new marketing techniques- the Internet.
Technological Analysis for pepsico
Some factors that cause company's actual results to differ the materially from the expected
results are as follows:
The effectiveness of the company's advertising, marketing and promotional
programs. The new technology of the internet and television which use special
effects for advertising through media. They make some products look attractive.
This helps in the selling of the products. This advertising makes the product
attractive. This technology is being used in the media to sell their products.
Introduction of cans and plastic bottles have increased the sales for pepsico as
these are easier to carry and you can bin them once they are used.
As the technology is getting advanced there has been introduction of the new
machineries all the time. Due to introduction of this machineries the production of
pepsico company has increased tremendously then it was few years ago
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
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
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 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.
ADVERTISING & PUBLICITY
Pepsi Co. is one of the biggest and spenders in India. It is also one of the biggest global ad
spenders. It has long a list of endorsers from pop star Ricky martin to file stars Shahrukh
Khan, Amitabh Bacchan etc. & Cricket stars Sachin Tendulkar, V.V.S Laxman, Harbhajan
Singh etc. Hindustan Thompsom Associates, the big gets advertising agency of India has the
account of Pepsi Co. is known for its board cast advertising but it also spends a lot in non
board cast advertising i.e. hoarding, banners, posters stickers, specialties, hangar,dealer
board, glow signboards, wall painting and news paper. The expenses on these type of
advertising are made at territory or unit level. LUCKNOW territory has assigned two local
advertising agencies R.D. Associates and Krishna for its territorial advertising.
PEPSI VS COKE/ RIVALRY WITH COKE
Pepsi ads often focused on celebrities, choosing Pepsi over Coke, supporting Pepsi's positioning as "The Choice of a New Generation." In 1975, Pepsi began showing people doing taste tests called Pepsi Challenge in which they preferred one product over the other, and then they began hiring more popular spokespersons to promote their products.
Coke dispenser flown aboard the Space Shuttle Endeavour in 1996.In the late 1990s, Pepsi launched its most successful long-term strategy of the Cola Wars, i.e. Pepsi Stuff. Consumers were invited to "Drink Pepsi, collect Pepsi Points on billions of packages. They could redeem the points for free Pepsi lifestyle merchandise.
After researching and testing the program for over two years to ensure that it resonated with consumers, Pepsi launched Pepsi Stuff, which was an instant success. Tens of millions of consumers participated. Pepsi outperformed Coke during the summer of the Atlanta Olympics - - where Coke was a lead sponsor of the Games. Due to its success, the program was expanded to include Mountain Dew. The company continued to run the
program for many years, continually innovating with new features each year.
In 1985, Coca-Cola and Pepsi were launched into space aboard the Space Shuttle Challenger on STS-51-F. The companies had designed special cans (officially the Carbonated Beverage Dispenser Evaluation payload or CBDE) to test packaging and dispensing techniques for use in zero G conditions. The experiment was classified a failure by the shuttle crew, primarily due to the lack of both refrigeration and gravity. A Coca-Cola fountain dispenser (officially a Fluids Generic Bio processing Apparatus-2 or FGBA-2) was developed for use on the Space Shuttle Endeavour as a "a test bed to determine if carbonated beverages can be produced from separately stored carbon dioxide, water and flavored syrups and determine if the resulting fluids can be made available for consumption without bubble nucleation and resulting foam formation". The unit flew in 1996 aboard STS-77 and held 1.65 liters each of Coca-Cola and Diet Coke.
TECHNIQUES FOR SALES PROMOTION
1.) Product availability
It means all the flavors of Pepsi should be available at one time. By which
customer can able to give any flavor to the consumer and can give the
satisfaction.
2.) 100% rich - It means that Company’s top management should always
worry about the quality of all the brands. If any organization wants to
service in the market and wants to better its image then quality play a very
integral role so for sales promotion quality should be 100% and good.
3.) Good relation – Company’s executive, sales man should make good
relation from dealer, whole seller and retailer. There is only 20% brand
loyal person. Remaining 80% impulse selling is going on. It means in India
in cold drinks line which ever brand consumer see first of all that brand is
demanded by user.
4.) Proper signage- Proper shin age also play a key roll in more selling.
5.) Fulfill the commitment– if executive promise to the customer of any
type. Then executive shovel fulfill his promise, such as. Executive say that
to the retailer if you will sell 1000 carrot in this month then I will give you a
coke fridge. If retailer has sold out 1000 carrot in the month then executive
should fulfill his commitment. By this manner selling will also improve.
Minimize total distribution costs for a given service output
Determine the target segments and the best channels for each segment
Objectives may vary with product characteristics
e.g. perishables, bulky products, non-standard items, products requiring installation &
maintenance
DISTRIBUTION CHANNELS (Pepsi)
There are two marketing channels that involve in the transfer of product from the producer
to the consumer. The intermediaries involved in the transfer are distributors and retailers.
DISTRIBUTORS:
Place
Distributors are appointed agents of the company who make orders to the company by
paying in advance through drafts, stock the products in their godowns and supply them to
outlets through their fleet of delivery was and a team of salesmen and drivers. They are
allowed to sell to company's product to the retailers in a specified area. The company
divides this area into routes. Each route is covered by one unit i.e. one de livery van, one
salesman one driver, one helper etc. These units and godown are their main investment.
Distributors have to invest in empty bottles and crates too, so t hat they can maintain a
specified quantity of reserve stock and facilitate the quick ratation of glass crates.
The company evaluates its distributors at the end of the year and makes plans for
the next year. Company fixes the targets for each distributor according to market size, last
year’s sales, potential growth assumption based on deposit of empties and installation of
coolers at outlets. Distributors are awarded with a fair margin of RS. 10 per crate for their
service. This margin could be increased for the sale above the targets, company offers are
met with distributors before appointing them. Distributor complying with many schemes
and contests for its customers for pushing different brands and giving various services.
Company also offers many gifts like, briefcase, and handbags. T-shirts, caps etc.to
encourage the distributors. If distributor does not agree with the conditions of these
agreement company may reduce the area of distributor or may even terminate the
relationship.
RETAILERS:
The sale of particular soft drinks depends a lot entirely on retailer’s wish. Like if he does
not keep Aquafina and if his shop is at the prime location then certainly the customer with
turn towards other cola drinks like Bisleri, Bailley ,Kinley etc. This all goes to prove that
retailer is king. So retailers require special focus from the company. Pepsi Co. helps the
retailers to serve its customer better by providing good margin to them for storing its
product using merchandising to improve in-store product display, installing cooling
equipment in outlets to make the product ready to drink and offering different promotion
schemes to them time to time to push different brands, Pepsi Co. Provides a fair margin of
RS. 24 per crate to the retailers.
CUSTOMER SERVICE DEPARTMENT
Customer Service is a support function to sales and marketing Department and is
concerned with effectively dealing with all customer complaints
This starts from: Ensuring Receipt, Documentation and Follow Up of all complaints to be
take care of within a specified time in order to achieve the ensure Customer (retailer)
distributor and consumer Satisfaction. The Customer complains directly through phone or
pager or through the sales team visiting them.
Types of Complaints handled are related to:
Consumer
Signage and Schemes
POPULAR SLOGANS :-
2006-2007
Yeh PYAAS Hai BADI!!
2007-2008
Yeh DIL Mange MORE!!
2008-2009
Yeh hai Youngistaan Meri Jaan!!
2010
Yeh Hai Youngistaan Ka WOW!!
WOW!!
CompetitorsCoke v/s Pepsi-Product
As seen above both the companies Coke and Pepsi have
a 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:
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 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 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 .
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 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 .
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
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.
PEPSI’S MARKETING STRATEGIES
Pepsi’s approach is radically different from that of Coke, Pepsi has gone in for
concentration segmentation. Pepsi has targeted the youth segment instead of trying to
be something to all segments.
Pepsi has since beginning strove to achieve its international position as `a drink
for the new generation’ in India. Helped by HTA’s forceful visuals and creative, Pepsi
has been successful in positioning itself for the younger generation.
SELLING PROCESS
Pepsi has a very well managed selling system. It takes as lot of care to ensure
that the products (Pepsi bottles) are available to the consumers.
Pepsi soft drinks are produced in our plant in different SKUs (Stock keeping
units) and distributed to our distributer and they further supply to the retailer.
Shahibabad (GZB) has been divided around 14 routes which are called direct routes.
For every route there is a Routs Agent. Route Agent moves with the company owned
truck and ensure that maximum shops are covered each day, so that regular supply of
Pepsi soft drinks is made.
Routs agents take the order from the shopkeepers and then with the help of loaders
they give the required number of crates to the retailer or shopkeeper & then move to
next.
Our plants also have some agency in each rout. They supply in the areas where
Pepsi’s trucks are not able to reach. These areas are called indirect-routes.
MICHAEL PORTER MODEL FOR PEPSI
POTENTIAL ENTRANTSBUYERS
SUPPLIERS SUBSTITUTES
INDUSTRY COMPETITORS
Sources: Phillip kotler’s Marketing Management
ENTRANTS
Two soft drink giants i.e. Pepsi, Coke, are already here, no other company plans to
enter in this capital-intensive industry at the moment. The investment in this industry is
more than Rs.100 per crate. This leaves no scope for small players who cannot match
the might of the two multinational giants. Thus at the moment there are no potential
entrants.
SUPPLIERS:
The bottling is done either by franchises or by company owned bottling plants. The
empty glass bottles and shells are sourced from local manufacturers. The ingredients
for the concentrate are sourced and manufactured locally. There is abundant supply of
water and sugar. Thus on the suppliers side Pepsi does not have a problem. Presently
the cans are imported and filled locally near Pune in Maharashtra. Seeing the potential,
various local manufacturers are setting up plants for manufacturing cans in India. Soon
this problem will also be resolved.
BUYERS
The following are the various market segments
1. On-premise market.
2. Home market.
3. At work market.
4. Youth market.
5. Special events market.
6. High visibility market.
SUBSTITUTES
Any drink, which quenches thirst, is a substitute. Thus this industry is highly competitive
as even water is substitute and almost a dozen products are launched every year.
Recently Dabar India Ltd. has launched “Real” - fruit juices and the makers of “Frooti”
have launched “Jolly Jelly”. But nowadays, people prefer carbonated drinks because of
the taste, fizz and the fun element attached with it.
COMPETITION: -
The other two major players in this industry are Coca Cola and Cadbury Schweppes.
The real competition is between Pepsi and Coke. Presence of competition will ensure
expansion of the market by collective efforts, which is growing at a rate of 25% annually.
There is tremendous potential considering the per capita consumption of India, which is
a measly 0.6 liters as compared to US where it is 83.5 liters. Presently Pepsi has stolen
a march over its rival because of its marketing efforts.
COCA-COLA
MARKETING STATEGIES OF COKE
a) PRODUCT
Coke was launched in India in Agra, October 24, in '93', soon after its
traditional all Indian launch of its Cola. At the sparking new bottling plants at Hathra
near Agra.Coke was back with a bang after its exit in 1977. Coke was planning to
launch in next summer the orange drink, Fanta-with the clear lemon drink, sprite,
following later in the year.
Coke's product line includes, Coca-Cola, Thums Up, Fanta, Maaza, Sprite, Club Soda,
7-up,Limca,Fanta apple, Diet Coke.
PACKAGING
Coca-Cola India Limited (CCIL) has bottled its Cola drink in different sizes and
different packaging i.e., 200 ml bottle, 300 ml. Bottle, 330 ml. Cans, 500 ml. and
bottles of 1 and 2 litre.
PRODUCT POSITIONING
One important thing must be noticed that Thums Up is a strong brand in western
and southern India, while Coca Cola is strong in Northern and Eastern India. With
volumes of Thums Up being low in the capital, there are likely chances of Coca Cola
slashing the prices of Thums Up to Rs. 5 and continue to sell Coca Cola at the same
rate. Analysts feel that this strategy may help Coke since it has 2 Cola brands in
comparison to Pepsi which has just one.
Thums Up accounts for 40% of Coca Cola company's turn over, followed by
Coca Cola which has a 23% share and Limca which accounts for 17% of the turn over
of the company. We will sell whatever consumers wants us to". Coca Cola India has
positioned Thums up as a beverage associated with adventure because of its strong
taste and also making it compete with Pepsi as even Pepsi is associated with adventure
youth.
b) PRICE
The price being fixed by industry, leaving very little role for the players to play in
the setting of the price, in turn making it difficult for competitors to compete on the basis
of price.
The fixed cost structure in Carbonated Soft Drinks Industry, and the intense competition
make it very difficult to change or alter the prices. The various costs incurred by the
individual companies are almost unavoidable. These being the costs of concentrates,
standard bottling operations, distributor and bottlers commissions, distribution expenses
and the promotional and advertising expenditure (As far as Coke is concerned, it had to
incur a little more than Pepsi as Pepsi paved its way to India in 1989 while Coke made a
comeback in 1993.)
Currently a 300 ml. Coke bottle is available for Rs10 the 330 can was initially
available for Rs. 15 and now Rs.20. The prices of 500 ml, 1 litre. And 2ltr being Rs20
Rs.35 and Rs.50 respectively (according to the current survey).
However, the trends may have been in the early '90's, now the prices of Pepsi and Coke
are the same making it difficult in future and present to compete on the basis of price.
c) PLACE
Coke may have gained an early advantage over Pepsi since it took over Parle in
1994. Hence, it had ready access to over 2,00,000 retailer outlets and 60 bottlers.
Coke was had a better distribution network, owing to the wide network of Parle drinks all
over India. Coke has further expanded its distribution network.
Coke and its product were available in over 3,00,000 outlets (in contrast with
Pepsi's 2,75,000). Coke has a greater advantage in terms of geographical coverage.
Coke and Pepsi have devised strategies to get rid of middlemen in the
distribution network. However, 50% of the industry unfortunately depends on these
middlemen. As of now, around 100 agents are present in Delhi. Bottlers of the 2
multinationals have strongly felt the need to remove these middlemen from the
distribution system, but very little success has been achieved in doing so.
d) PROMOTION
It must be remembered that soft drinks purchases are an "impulse buy low
involvement products" which makes promotion and advertising an important marketing
tool. The 2 arch rivals have spent a lot on advertising and on promotional activities.
According to Paul Stobart, Advertising encourages customers to recognize the
quality the company offers. Price promotions often produce short-term sales increases.
Coca Cola has entered new markets and also developing market economics (like India) with
much-needed jobs.
STRATEGIES ADOPTED
BY COKE AND PEPSI
The Pepsi Process: Despite being a global brand, Pepsi has built its success on
meeting the Indian consumer’s needs, particularly in terms of making the brand
synchronize with localized events and traditions. Instead of harping on its global
lineage, ergo, it tries to plug into ethnic festivals, use the vernacular indifferent part of
the country, and blend into the local fabric. Pepsi is using both national campaigns-such
as the Drink Pepsi, Get Stuff scheme, which offers large discounts on other products to
Pepsi-buyers as well as local .
The Coke Copy: Instead of creating a bond with the customers through small but high-
impact events, Coca-Cola chose to associate itself with national and international mega
events like the World Cup Cricket, 1996, and world cup football 1998. But now coke is
also entering into local actions. Coke is also trying to make their brand synchronize with
localized events traditions and festivals. Coca-Cola new tag line in this advertisement is
“Real shopping, Real refresher”. In this way Coke is copy Pepsi.
EMPOWERMENT
The Pepsi Process: Once of the strongest weapons in Pepsi’s armory is the flexibility it has empowered its people with. Every manager and salesperson has the authority to take whatever steps he, or she, feels will make consumers aware of the brand and increase its consumption.
The Coke Copy: Flexibility is the weapon that Coca-Cola, fettered as it is by the need
for approvals from Atlanta for almost everything. In the past, this has shown up in its
stubborn insistence on junking the franchisee network it had acquired from Parle; in its
dependence on its own feedback mechanism over that of its bottlers;’ and on its
headquarters-led approach.
PRICE
The Pepsi process: Pepsi has consistently wielded its pricing strategy as in invitation
to sample, aiming to turn trial into addiction.
It launched the 500 ml bottle in 1994 at Rs. 18 versus Thums Up’s Rs. 9, in April, 1996,
its 1.5 litre bottle followed Coke into the marketplace at Rs. 30 – Rs 5 less than
Coke’s .But it couldn’t continue the lower price positioning for long.
The Coke Copy: Initially, coke carbon-copied the strategy by introducing its 330ml cans
in January 1996, at an invitation price of Rs. 15 before raising it to Rs.18. By this time, it
had realized that the Coca-Cola brand did not hold enough attraction for customers to
fork out a premium.
The Cola
Wars
OVER A CENTURY OF COLA SLOGANS, COMMERCIALS, BLUNDERS, AND
COUPS
There's little doubt that the most spirited and intense competition in the beverage world
is between Coca-Cola and Pepsi. These two American companies long ago took their
battle worldwide, and although there are other colas in the market, these giants occupy
this high-stakes arena by themselves. The impact of Coke and Pepsi on popular culture
is indisputable, and I have observed in my time managing this web site that America
has not become jaded about the cola wars. The memorabilia, the jingles, the trivia - all
still popular. So I am offering this page in an attempt to assuage a wee bit of the Coke
and Pepsi thirst that is thriving on our planet.
IT ALL STARTED . . . .
Coca-Cola was invented and first marketed in 1886, followed by Pepsi in 1898. Coca-
Cola was named after the coca leaves and kola nuts John Pemberton used to make it,
and Pepsi after the beneficial affects its creator, Caleb Bradham,
claimed it had on dyspepsia. For many years, Coca-Cola had the cola market cornered.
Pepsi was a distant, no threatening contender. But as the market got more and more
lucrative, professional advertising became more and more important. These soda
companies have been leading the way in advertising ever since.
ADVERTISING HISTORY & COMMERCIALS
Pepsi has definitely leaned towards the appeal of celebrities, popular music, and young
people in television commercials, while Coke relies more heavily on images of
happiness and togetherness, tradition, and nationalism, perpetually trying to cash in on
its original lead. In a simplified sense, you could sum up the strategies as Coke: Old,
Pepsi: New. In fact, as we will see, when Coca-Cola tried something new, it was
disaster.
The first magazine ad for Coca-Cola appeared in Munsey's in 1902. Advertisements
began to appear on billboards, newspapers, and streetcars. Soon there were serving
trays with images of people enjoying Coca-Cola, and glasses with the cola's name on
them. At this time, Coca-Cola and Pepsi were served in drugstore soda fountains.
In 1909, Pepsi used its first celebrity endorser, automobile race driver Barney
Oldfield, in newspaper ads. In 1921, Pepsi went bankrupt, but continued to appear on
the scene, although not nearly so successfully as Coca-Cola. In 1931, Pepsi went
bankrupt again, but the new owner, Roy Megargel, would hit upon an idea that would
finally give Coca-Cola some competition. In 1934, he marketed Pepsi in a 12-ounce
bottle for a nickle. At the time, Coca-Cola was sold in a 6-ounce bottle for ten cents.
Voila! Profits for Pepsi.
Pepsi racked up another first by airing the first radio jingle in 1939. It was so popular
that it was played in jukeboxes and became a hit recordCoca-Cola hit the airwaves in
1941.
In 1946, inflation forced Pepsi to increase prices. And in 1950, Pepsi offered a larger
26-ounce bottle to court the young American housewife.
In the 1960's, the cola ad wars moved to television. Coca-Cola employed a host of celebrity singers to promote the product, including Connie Francis , Tom Jones, The New Beats, Nancy Sinatra, and The Supremes. As we moved through the years, both colas incorporated some of their best slogans ("Pepsi Generation" and "the Real Thing") into subsequent commercials.
RESEARCH METHODOLOGY OF COMPARISION
Research in common language refers to a search for knowledge. One can also
define research as a scientific and systematic search for pertinent information
on specific topic.
In this era of cutthroat competition it is of vital importance for any company have
a strong foothold in the product market and having a strong distribution network,
effective sales promotion and advertising strategies. These pricing policies should also
be such which will help them in achieving their targets. Ever company strives to earn
profit through maximizing their sales according to varying needs of their customers. The
same applies to the soft-drink company also.
Both the two companies PepsiCo, Coca-Cola (I) Ltd. is aiming to rise well above their
competitors. So the researcher was entrusted to carry out marketing overview about
some of the most usually demand soft drink.
In order to clearly define the task we obtain ideas and insight through the survey
method from primary sources.Field research through observation of customers and
distribution channels.
Objective & Limitations
The subjects (companies) under study in this project are:-
i) PepsiCo
ii) Coca-Cola (I) Ltd.
Secondary Objectives
The secondary objective of the research is to gauge the image of PepsiCo Vis-a --Vis
Coca-Cola [I] Ltd. The research was planned to find the effect of the different brand
position strategies adopted from time to time on audience’s perception.
It is believed that the audience is perplexed by almost same appeal by both the
companies in their recent advertisements
The need is to identify new avenues and ways to project the image of their company.
To identify the difference in their tone, look and style of communication.
To do a comparative study of who comes up with more exciting and innovative
offers.
To find out the consumer’s perception about efficiency of marketing and the future
market leader.
To sketch the imagery of the consumers about various brands and both the
companies in totally.
For this purpose fieldwork as well as table work was done to complete the project. The
various facts and figures of the companies were studied and subsequently suggestions
are made, which keep the company the vendors and the consumers in mind.
CONLUSIONS
Pepsi is the market leader in terms of soft drinks in India, but comes second to Coca-Cola which consists of Coca-Cola brands.
Pepsi’s main target is obviously to be the market leader and leave its nearest competitor, Coca-Cola, far behind. To achieve this Pepsi seems to be relying on mass advertising. They spend about 60-70 crore rupees annually on marketing activities. The consumer is bombarded with Pepsi advertisements, sign, logo’s etc., everywhere.
Pepsi’s core market is the young –adult and Pepsi is taking great measures to change theperception of these young-adults., Pepsi wants that these consumers should associate all colas as Pepsi, the brand Pepsi and cola should be synonymous with each other. This they are trying to do by getting the heroes of these consumers to endorse their product e.g. Sachin Tendulkar and also by advertising for and by youngsters.
Pepsi drinks are available in almost the whole of India, this shows the importance paid to distribution. Brand loyalists are very few in the market. Thus the drink should be easily available, so that consumers cannot shift their preferences.