A Study on Pepsi Company With Focus Strategy

8/12/2019 A Study on Pepsi Company With Focus Strategy

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M.com (Part I) A Study On Pepsi Company With Focus Strategy.

Chapter No: 1.

1.1 ORIGIN OF PEPSI:

In 1!"# PepsiCo# Inc .$as %ounded &y 'onad M.

enda# president and chie% e*ecuti+e o%%icer o% Pepsi,Coa and -erman W.

ay# chairman and chie% e*ecuti+e o%%icer o% Frito,ay# through the merger

o% the t$o companies. Cae& /radham# a 0e$ /ern# 0.C. pharmacist#

created pepsi,Coa in the ate 12s.

0o singe %oreign in+estment pro3ect has &een the center

o% much attention and contro+ersy in the ate 12s and eary 12s as the

Pepsi Co pro3ect in India. 4he pro3ect# Pepsi Foods imited# $as ceared &y

the Indian go+ernment in Septem&er 1 as a 3oint +enture o% Pepsi Co#

Pun3a& go+ernment,o$ned Pun3a& Agro Industria Corporation (PAIC) and

5otas India imited. /e%ore this pro3ect $as ceared# PepsiCo made an

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%or$ard that this pro3ect $i create ampe empoyment opportunities %or the

unempoyed youth $ho has ta9en the path o% terrorism and there&y $i hep

in restoration o% peace in Pun3a&. 4his argument $as $e recei+ed in the

poitica circes in 'ehi and Pun3a $hich %inay ed to PepsiCo=s entry

into India in the %orm o% a 3oint +enture $ith PAIC# and 5otas as its partners.

4he e>uity o% Pepsi Foods imited $as di+ided among the partners $ith

PAIC hoding ?!.11 percent# 5otas


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State o% the art technoogy $oud &e pro+ided in the %ieds o% %ood

processing and so%t drin9 manu%acturing at no %oreign e*change

out%o$B

"2 percent o% the tota +aue o% production $i &e e*portedB

An agro,research center $i &e esta&ished &y PepsiCo in

consutation $ith ICA7 and PA:B

0o %oreign &rand name $i &e used %or domestic saesB

4he e*port,import ratio $i &e "1 o+er 12 years# $hich means that

%or e+ery doar spends in %oreign e*change on this pro3ect# the

company $i ensure an e*port earning o% " doars %or 12 yearsB


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supported nationa priorities in area such as e*ports# agricuture#

empoyment and technoogy.;

1.2 FROM JOINT VENTURE TO WHOLLY OWNE

SU!SI"RY:

Pepsi is no onger a 3oint +enture company $ith its

Indian partners. 4a9ing %u ad+antage o% i&eraiDed poicies# it has ta9en %u

contro o% Pepsi Foods. In 1@# Pepsi made an o%%er to &oth 5otas and

PAIC to &uy their e>uity at ;attracti+e; terms. 5otas sod a its shares to

Pepsi $hie PAIC# &eing a pu&ic enterprise# $as %orced to pu out and no$

it hods ess than 1 percent o% the tota e>uity in Pepsi Foods td. Instead o%

ta9ing strict action against Pepsi %or not %oo$ing its commitments# the

Indian go+ernment has gi+en more concessions to it in the post,i&eraiDation

period. For instance# it has ao$ed Pepsi to increase its turno+er o%

&e+erages component to &eyond


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7ecenty the go+ernment aso ao$ed PepsiCo to set up

a ne$ company in India caed PepsiCo India -odings P+t.td# a $hoy

o$ned su&sidiary o% PepsiCo Internationa. Surprisingy# the ne$ company

is aso engaged in &e+erage manu%acturing# &otting and e*ports acti+ities as

Pepsi Foods td. A the ne$ in+estments &y the PepsiCo Internationa ha+e

&een channeised through this ne$ +enture. It no$ handes


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recent shi%t in Pepsi;s mar9eting strategy has &een its %ocus on Coa o+er

other non,Coa &rands. EWe ha+e singe, mindedy %ocused on &rand PepsiE

admits 7ishi# 5ice,President# Mar9eting# Pepsi. (/usiness India# anuary 1",

uestion is , Who $i %orce Pepsi to impement

its commitmentsG


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Chapter No: 2

TYPES OF PROUCTS:

Pepsi

'iet Pepsi

Pepsi Aha

Sice

Mirinda

,:p

A>ua%ina Minera Water


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2.2 THE SOFT RIN# M"R#ET:

4he so%t drin9 mar9ets can &e segmented on the &asis o%

pace o% consumption or on the &asis o% type o% products.

4he segmentation on the &asis o% pace o% consumption

di+ides the mar9et into t$o parts ,

On,premise,2H o% the consumption o% so%t drin9s is on premise i.e.

restaurants# rai$ays stations# cinema etc.

At,home, the rest


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o Cear ime

o Mango

Ora$%e %a+or &ased so%t drin9s constitute around 1H o% the

mar9et. 4he segment is argey dominated &y nationa &rands i9e

Fanta o% Coca Coa and Mirinda Orange o% PepsiCo# $hich

coecti+ey %orm1"H o% the mar9et rest o% the mar9et is in hands o%

smaer &rands i9e Crush (earier o% Cad&ury Sch$eppes and no$ o%

coca Coa)# 8od Spot etc.

C&o'() L*+e %a+or constitutes 1@H o% the mar9et and is argey

dominated &y imca o% coca coa and Mirinda emon o% PepsiCo.

imca is the mar9et eader $ith around 2,"H o% the mar9et

%oo$ed &y Mirinda emon.

C&ear L*+e: this segment o% the mar9et $itnessed good gro$th

initiay $ith a the payers aunching their &rands in the segment. /ut

no$ the gro$th in the segment has so$ed do$n. 4he &rands

a+aia&e in this segment are :p o% Pepsi# Sprite o% Coca Coa and

Canada 'ry (earier o% Cad&ury Sch$eppes and no$ o% Coca coa).

4he segment constitutes ?H o% the tota so%t drin9s mar9et.

12


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Chapter ,

M"R#ET SI-E "N GROWTH:

So%t drin9 mar9et siDe is around


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$ith increase in occasion ed saes. Changing i%e stye# increasing

ur&aniDation and impact o% i&eraiDation has so$y and graduay started

mo+ing the mar9et %rom impuse ed to occasion ed and home re%rigeration

ed consumption.

4he mar9et pre%erence is highy regiona &ased. Whie

coa drin9s ha+e main mar9ets in metro cities and northern states o% :P#

Pun3a -aryana etc. Orange %a+ored drin9s are popuar in southern states.

Sodas too are sod argey in southern states &esides sae through &ars.

Western mar9ets ha+e pre%erence to$ards mango,%a+ored drin9s. 'iet co9e

presenty constitutes 3ust 2.H o% the tota car&onated &e+erage mar9et.

In terms o% S:s the mar9et is s9e$ed to$ards ?22m#

$hich constitutes around 2,"H o% the mar9et# rest is in the %orm o% other

pac9 siDes. /ut $ith increasing occasion ed and home re%rigeration ed

consumption the saes o% &igger S:s i9e more than 1 itre pac9 siDes has

increased this has ed to increase in contri&ution %rom P64 &otte saes to

1"H o% the tota turno+er in FJ22. And most o% these P64 &otte saes# up to

"H are in ur&an areas.

1?


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Another s9e$ ness is in terms o% the time o% the year

$hen the consumption ta9es pace. Most o% the saes o% so%t drin9s ta9e

pace during summers $hie 3ust ",!H o% tota saes ta9e pace in $inters. In

summers the high season asts %or 2," days# $hich contri&utes more than

"2H o% the tota yeary saes.

Another pecuiar %eature o% the mar9et is that o%

positioning and targeting o% +arious &rands. Whie Coa &rand o% Co9e is

targeted at teen,agers and is positioned as re%reshment %or mind and &ody. Its

4humps :p &rand is targeted at peope in age group o%


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net$or9 had ! a9h outets across the country during FJ22 $hich it is

panning to increase to ." a9h &y FJ21.

Maret Share *$ 3:

/rand 0ame Mar9et Share (in H) Mar9et Share (in H)

Pepsi @1 @

Coca Coa" @

4Maret*$% *0 $o &o$%er a5o't the 0t'66 that )o'

+ae7 5't a5o't the 0tor*e0 )o' te&&4

8 Seth Go(*$

,.9 CONSUMER H"!ITS "N PR"CITCE:

So%t drin9s come under the category o% products purchased in

impuse. 4hough the mar9et is marred &y &rand oyaty the purchase

decision itse% is a o$ in+o+ement decision. 4his attitude o% impuse

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&uying is so$y changing to occasion,ed &uying and aso to some

e*tent to consumption through home re%rigeration particuary in

ur&an areas.

4he mar9et is so$y mo+ing %rom non acohoic car&onated drin9s to

%ruit &ased drin9s and aso to pain &otted $ater due to o$er price

and ready a+aia&iity.

Consumers purchase so%t drin9s primariy to >uench thirst. 4here%ore

peope tra+eing and not ha+ing access to hygienic $ater reach out %or

so%t drin9. 4his accounts %or a arge part o% the saes.

/rand a$areness pays a crucia roe in purchase decisions.

Consumers pre%er con+enient and economy products.

A+aia&iity in the chied %orm a%%ects the purchase decision. 4his has

made &oth the companies to push its saes and to increase its retai

distri&ution &y o%%ering 5isi Cooers to retaiers.

Whie there is no a+ersion to consumption o% so%t drin9s &y any age

group# the main consumers o% this mar9et are peope in the age group

o% ?2 and &eo$.

Product di%%erentiation is +ery o$# as a the products taste the same.

/ut &rand oyaty is high in the case o% 9ids and peope in the age

group o%


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Consumers are sensiti+e to the outay $here the purchase o% &e+erages

is concerned. -ence the mar9et is price sensiti+e.

'ue to the high cost o% so%t drin9s# a ot o% times consumers pre%er

&e+erages i9e tea# co%%ee or other drin9s i9e sher&et and s>uashes.

Per capita consumption in India is among o$est in the $ord at "

&ottes per annum compared to 2 &ottes in 4haiand and 22 &ottes

in :SA.

Whie "H o% the P64 &otte consumption is in ur&an areas the


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@?H o% the retaiers sur+eyed tod that in so%t drin9s ad+ertising is the

9ey component in dri+ing saes. Whie ?


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Coca,Coa controed the Indian mar9et unti 1# $hen

the anata Party &eat the Congress Party o% then Prime Minister Indira

8andhi. 4o punish Coca,Coa;s principa &otter# a Congress Party sta$art

and ongtime 8andhi supporter# the anata go+ernment demanded that Coca,

Coa trans%er its syrup %ormua to an Indian su&sidiary (Cha9ra+arty# @?).

Coca,Coa &a9ed and $ithdre$ %rom the country. India# no$ e%t $ithout

&oth Coca,Coa and Pepsi# &ecame a protected mar9et. In the meantime#

India;s t$o argest so%t,drin9 producers ha+e gotten rich and aDy $hie

controing 2H o% the Indian mar9et. 4hese domestic producers ha+e itte

incenti+e to e*pand their pants or de+eop the country;s potentiay

enormous mar9et (Cha9ra+arty# @?). Some anaysts reason that the Indian

mar9et may &e more ucrati+e than the Chinese mar9et. India has "2

miion potentia customers# 1"2 miion o% $hom comprise the midde cass#

$ith disposa&e income to spend on cars# 5C7s# and computers. 4he Indian

midde cass is gro$ing at 12H per year. 4o o&tain the icense %or India#

Pepsi had to e*port " o% ocay made products %or e+ery 1 o% materias it

imported# and it had to agree to hep the Indian go+ernment to initiate a

second agricutura re+oution.

1


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Pepsi has aso had to ta9e on Indian partners. In the end#

a parties in+o+ed seem to come out ahead Pepsi gains access to a

potentiay enormous mar9etB Indian &otters $i get to ser+e a mar9et that

is e*panding rapidy &ecause o% competitionB and the Indian consumer

&ene%its %rom the competition %rom a&road and $i pay o$er prices. 6+en

&e%ore the %irst &otte o% Pepsi hit the she+es# oca so%t drin9 manu%acturers

increased the siDe o% their &ottes &y


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i9ing# ne$ %oreign mar9ets can transate into ucrati+e opportunities in the

ong run.

4he ongoing coa $ar &et$een go&a ri+as Pepsi and

Coca,Coa has ta9en a $eird t$ist in India $ith the %ormer dragging the

atter to court. 4he charge Coca,Coa has snatched empoyees# &otters# and

agents# a o% $hom are &ound to Pepsi &y a contract.

Pepsi has charged Co9e $ith ha+ing entered into a conspiracy to disrupt its

&usiness operations &y inducing 9ey empoyees and associates to &rea9

e*isting contracts iegay.

Pepsi has sought a permanent in3unction and an e* parte

order against co9e# restraining it %rom ta9ing a$ay Pepsi;s empoyees and

&usiness associates. Pepsi has aso reser+ed the right to see9 %inancia

damages %rom Co9e at a ater date i% necessary.

Pepsi has caimed that a doDen midde,e+e managers

and three territory managers &ro9e their contracts $ith Pepsi to 3oin Co9e in

recent months# $hie during the ast year and ha%# se+en managers >uit

Pepsi to 3oin Coca,Coa.

ustice C M 0ayar o% the 'ehi high court on Apri 1

issued notices and summons to Coca,Coa and 1" others %or May !.

-o$e+er# ustice 0ayar re%used to grant the e* parte in3unction sought &y


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Pepsi India to stop the aeged inducements &y Co9e in o%%ering empoyment

to Pepsi;s empoyees $hie the suit $as pending in court.

On &eha% o% Pepsi# Asho9 'esai and Arun aitey

contended that Coca,Coa had &een Eratted &y the huge success o% Pepsi in

India entered into a conspiracy during the ast si* months to cause oss and

damage to Pepsi;s &usiness interests &y adopting un%air and iega means.E

It added that Coca,Coa had approached many 9ey managers and had

success%uy ured a commercia manager o% its &otting &usiness 8aura+

'ugga# and a manager in Surat Saiesh oshi# &esides others.

Pepsi charged that $hie initiay these approaches $ere

sporadic# o+er the ast si* months it is cear that Coca,Coa has changed its

strategy and has decided to consciousy target and approach 9ey empoyees

o% Pepsi at +arious ocations in India.

4he company has aeged that in most cases# the

empoyees ha+e not &een gi+en time to adhere to the 2,day notice period

and the one,year con%identiaity agreement. 4he atter dea &ars empoyees

3oining its ri+as %or at east a year. 'esai caimed Co9e;s actions $oud

directy harm the &usiness interests o% Pepsi# $hich had in+ested o+er ?22

miion in the country in esta&ishing &usiness in%rastructure.


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In its de%ense# Co9e is e*pected to see9 reie% in the

Indian Constitution# $hich states that there can &e no restriction on the

mo+ement o% a&or. /esides# any e%%ort &y a company to restrict its

empoyees %rom 3oining other companies might %a %ou o% the Monopoies

and 7estricti+e 4rade Practices Act as an un%air trade practice. Pepsi has

cited the instance o% Co9e snapping up cric9eter a+aga Srinath in spite o%

the atter signing a contract $ith Pepsi;s sports consutant# uoting sources# said that Srinath;s contract

had &een ony in the +er&a stage.

Simiary# Pepsi has charged Co9e $ith inducing the

/oard o% Contro %or Cric9et in India to gi+e the sponsorship o% the recenty

concuded Pepsi 4rianguar Cric9et Series to co9e# as ac9no$edged in the

/CCI su&mission &e%ore the /om&ay high court# e+en $hie a contract $as

signed $ith Pepsi. Pepsi has isted the case o% Co9e trying to induce its

music consutant '0A 0et$or9s Pri+ate td# $hich organiDed the Janni

sho$# to snap its ties $ith Pepsi and 3oin Co9e.

Incidentay# in resuts announced %or the %irst three

months o% the year# Pepsi has s$ept Coca,Coa aside. Pepsi has reported a

gro$th o%


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Coca,Coa India chie% e*ecuti+e 'onad Short had announced that Co9e

$oud gro$ &y at east uired $hen it came into India ,, 4hums :p#

imca# and 8od Spot ,, continue to dominate India $ith a "" per cent

mar9et share to Pepsi;s @? per cent. /ut in the coa segment# Co9e comes a

poor third a%ter 4hums :p and Pepsi.

I% summer is at its pea9# can a coa $ar o+er mar9et

shares &e %ar &ehindG Interestingy# it=s the same saga# yet again# $ith each o%

the t$o so%t drin9 ma3ors Pepsi Foods td and Coca,Coa India caiming

mar9et eadership &ased on di%%erent sur+eys.

4he main gro$th dri+ers# according to Mr. San3i+ 8upta#

deputy president# Coca,Coa India# $ere its rura initiati+es %or CS's and

dri+ing a%%orda&iity through o$er price points and strengthening

distri&ution.

'uring the period under re+ie$# Co9e aunched


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Whie the gro$th is ed &y CS'# $hich has gro$n a high

dou&e digit# the %ocus on &otted $ater has reaped rich di+idends on an

unprecedented gro$th o% 1"2 per cent# the company said. NA>ua%ina# $hich

is sti not %uy nationa# is the %astest gro$ing &otted $ater &rand in the

country# caimed Ms 5i&ha 7ishi# e*ecuti+e director (mar9eting)# Pepsi

Foods P+t. td. According to Ms 7ishi Nthe gro$th has &een dri+en &y an

e*ceent consumer response to Pepsi,Aha $hich has dei+ered incrementa

saes. 4he ne$y aunched +ariant o% %agship &rand Pepsi is on $ay to

&ecoming a 7s 122,crore &rand &y the end o% the current year and had

aready notched up saes $orth 7s 2 crore# a Pepsi spo9esperson said.


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Chapter No: 9

9.1 THE RUR"L M"R#ET:

4he ony thing you can say $ith certainty a&out the

Indian rura mar9et right no$ is that it is the &est trading ground %or &oth

Indian and mutinationa corporations. A &urgeoning# untapped mar9et

estimated at neary 1"2 miion stretching across the ength and &readth o%

the Indian su&continent.


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4he +ision has ong %ascinated Indian organiDations as

$e as M0Cs. And no$# the dream is &aDing &righter than e+er as the

Indian rura &aDaar is dispaying a mar9et trend to$ards consumerism#

outpacing the ur&an mar9et in its e+er,increasing demand %or dura&e

products i9e $rist,$atches# %ans# tee+isions# +ideo cassette recorders as

aso non,dura&es i9e nai poish# ipstic9# ice,cream# shampoo and

mos>uito repeants.

EIt;s astounding... the rura mar9et is no$ spea9ing the

+oice o% the city. Our saes ha+e recorded a near hundred percent 3ump in the

countryside during the ast year#E remar9ed Maruti :dyog imited;s

mar9eting director agdish hattar.

It has &een primariy attri&uted to a spurt in the

purchasing capacity o% %armers no$ en3oying an increasing mar9eta&e

surpus o% %arm produce. In addition# an estimated induction o% 7s 1@2

&iion in the rura sector through the go+ernment;s rura de+eopment

schemes in the Se+enth Pan and a&out 7s ?22 &iion in the 6ighth Pan is

aso &eie+ed to ha+e signi%icanty contri&uted to the rapid gro$th in

demand.

Statistics presented at the meet assessed the mar9et siDe

%or nai poish at around 7s


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miion in the cities. Simiary# the mar9et %or ipstic9s is $orth around 7s

tonnes). 4he rura mar9et %or mos>uito repeents is rec9oned at around 7s

1? miion against a mere 7s miion in ur&an centers.

Among the items $hose mar9et share is on the rise in

rura regions are coour and /KW tee+ision sets# cassette recorders# 5C7s#

pressure coo9ers# mi*er,grinders# re%rigerators# ceiing and ta&e %ans and

se$ing machines. 8eysers# $hich had amost no ta9ers in the countryside ti

the midde o% 12s# ha+e made an inroad into this mar9et $ith an estimated

share o% itte ess than 1 per cent.

EIn my opinion# the &asic surge in the purchases o%

consumer products is not con%ined to the peope $ith high e+es o% income

in India. 6+en those $ho appear to &e poor# and ha+e amongst the o$est

e+es o% income# &uy and use such products#E remar9ed S 7ao# %ormer

director genera o% the 0ationa Counci %or Ad+anced 6conomic 7esearch.

E4he rura mar9et is a signi%icant part o% our mar9eting strategy $hich

ena&es us to hep the consumer in9 $ith our product#E remar9ed Coca,Coa


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India;s mar9eting director San3ee+ 8upta# $hie ans$ering >ueries on the

mutinationa;s attempts to paint the hoy city o% -arid$ar red.

4he mood in the hoy city and the neigh&ouring to$n ,,

$here ri+a Pepsi had a compete s$ay ,, underined the %act that the coa

giants $oud do amost anything and e+erything to gra& &oth consumer

attention and a sice o% the mar9et that is estimated at a $hopping


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in the dusty# pot,hoded streets o% the price,conscious rura mar9ets o% /ihar#

:ttar Pradesh# 8u3arat and West /enga this summer.

E6+ents i9e the um&h Mea $here more than 12

miion +isit are once in a i%etime mar9eting opportunities that ena&es a

company ,, either Indian or mutinationa ,, to understand the importance o%

the rura mar9et. And companies are getting e*tremey e*cited a&out the

huge num&ers that rura India presents#E remar9ed 'ehi,&ased rura

mar9eting %irm# 7CKM;s 7a3esh Monga.

Signi%icanty# most o% the purchases are made %rom the

househod;s o$n income. -ire,purchase schemes and oans account %or ony

around ten per cent o% rura &uying. As a resut# an increasing num&er o%

companies are ma9ing a &eeine %or the +iages and smaer to$ns.

According to data presented at the seminar# $atches continued to &e the

most pre%erred gi%t items in the countryside. Another emerging trend $as the

rura &uyers; disenchantment %or second,hand items# uness it $as something

i9e a radio# cassette recorder or a ta&e %an.

?2


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9.2 IENTIFYING THE RUR"L M"R#ET:

4he tota mar9et is normay too arge and %ragmented to

&e +ia&e target %or a %irm;s mar9eting e%%orts. 4here%ore# a &usiness $i

seect a target mar9et,a group o% customers $ith simiar characteristics $ho

currenty# or $ho may in the %uture# purchase the product. t$o &road

approaches can &e adopted $hen seecting a target mar9et the tota

approach or the mar9et segmentation approach

4ota mar9et approach=appies $hen a %irm targets the

tota mar9et %or a particuar product. 4he %irm de+eops a singe mar9eting

mi* and directs it at the entire mar9et %or the product. 4his means there is

one type o% product $ith itte or no +ariation# one promotiona program

aimed at e+eryone# one price# and one distri&ution system used to reach a

the customers.

9., Maret 0e%+e$tat*o$ approa/h :

?1


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It occurs $hen the tota mar9et is su&di+ided into groups

o% peope $ho share one or more common characteristics.

Mar9eters use %or main +aria&es $hen segmenting the tota mar9et

e+o%raph*/= age# gender# ethnicity# income# occupation#

education e+e# reigion# %amiy siDe and socia cass

Geo%raph*/= ur&ansu&ur&anrura ocation# region# cimate#

and%orm

Pro('/t re&ate(=reguar use# %irst,time use# &rand oyaty# price

sensiti+ity# end use

P0)/ho %raph*/=personaity# moti+es# i%estyes

?


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Chapter No:

M"R#ETING STR"TEGIES:

For a &usiness to &e success%u $ith its mar9eting acti+ities# it

$i need to underta9e a Esituationa anaysisE# incuding a

SWO4 anaysis. A &usiness must continuay identi%y and ta9e

ad+antage o% opportunities i% it is to retain a competiti+e

ad+antage o+er its ri+as or competitors. 4his $i aso in+o+e

continua impro+ement in the organiDation and operations o% the

&usiness and the de+eopment o% a mar9eting pan.

Identi%y the target mar9ets that the &usiness $ants to pursue.

4his is $here a &usiness distinguishes &et$een the di%%erent

groups that ma9e up the mar9et. 4his can &e done on

demographic (e.g. age and se*)# geographic ocation or

psychographics (consumer &eha+ior) +aria&es.

'e+eop a mar9eting mi* appropriate to the target mar9ets.

??


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Put a mar9eting management system in pace to coect data on

items such as the mar9eting strategies or product saes so that

in%ormed decisions can &e made a&out %uture mar9eting

acti+ities.

.1 THE M"R#ETING MI>=9 P;S WITH SPECI"L

REFERENCE TO PEPSI:

Pro('/t:

?@
http://c/Program%20Files/Claris%20Corp/Claris%20Home%20Page%203.0/webpage.htm#Promotion


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instance# has rec9oned that gi+ing consumers ?? per cent (122 m) ess coa

at "2 per cent o% the price (7s ") is not a sustaina&e option and can# at &est#

&e used as an introductory o%%er.

4he concusion is &ased on hard %acts. ast year# the

&e+erage giants test,mar9eted


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the &iggest o% a. It=s &een success%uy test mar9eted in /angaore# /aroda

and Coim&atore and may soon ro out nationay.

In case o% the distri&ution net$or9# there is no

in+o+ement o% $hoesaers in the distri&ution o% products. It is more i9e an

agent net$or9. 4he companies ha+e di+ided the country into +arious regions

and esta&ished a %ranchisee in each region. 4he %ranchisees ha+e their o$n

&otting pants and manage a the day,to,day operations. -o$e+er# o% ate#

the so%t drin9s companies ha+e started setting up company o$ned &otting

units ha+e &een ac>uiring some o% its %ranchise &ottes.

In the current system# the stri9e rate in the 'ehi mar9et

is a&out @2 per cent# $hich can &e impro+ed to 2 per cent in the pea9

season# caims a %ranchise director. 4he resut %or Pepsi coud &e signi%icant

sa+ings. NCoas ser+ice 3ust .", a9h accounts compared to the other

FMC8 payers $ho ser+ice three times the num&er. Inno+ation in our

distri&ution system $i ta9e us coser to the


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costs. N4here are penty o% inno+ations possi&e in distri&ution that can cut

costs# says a Pepsi o%%icia.

For Pepsi# the rura mar9et is a chosen thrust this year. It

has targeted to reach


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Per0o$a& 0e&&*$%: $hat happens in the EshopE# contact &et$een saes

peope and consumers or customers.

Sa&e0 pro+ot*o$:use o% gimmic9s and incenti+es e.g. competitions.

Spo$0or0h*p a$( pro+ot*o$a& &*/e$0*$%:incuding speci%ic products

sod under icense that promotes the &usiness (e.g. %oot&a 3umpers).

P'5&*/*t) or p'5&*/ re&at*o$0: Ead+ersariaE in oca papers or specia

promotiona materias.

'ue to the coa $ars promotion# and ad+ertising has

a$ays &een an integra part %or &oth the coa cos Pepsi and Co9e. /ut %or

the %irst time perhaps in the history o% coa $ars# the strategies o% the t$o

giant cos are di+erging in India. Whether it=s &usiness or product strategies

or the critica distri&ution game pan# the archri+as are ta9ing roads that do

not meet. Mr. /a9shi o% Pepsi Co. is &ringing a change in their distri&ution

and mar9eting strategies. 0o$ days $here Co9e is concentrating more on

the


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aong $ith their 1.",iter P64 &ottes. Pepsi made this 1.",iter P64 &otte

+ery %amous %or their specia %esti+e occasions and marriage.

We the popuarity o% the product has aso increased due

to their ad+ertisements or &asicay %amous cric9et and &oy$ood

personaities endorsing this product. For instance the Sachin NAaa re Aaa

ad+ertisement $here e+en he is $earing a mas9 aong $ith those rura 9ids.

Or you can e+en ta9e the ne$ Sachin and Amita&h /achchan ad+ertisement

$here &oth o% them say N Jeh 'i Maange MoreTTTTTTT Sachin has done

many ad+ertisements %or Pepsi in the span o% 12 years.

Pepsi aso 9ic9ed o%% a rura campaign# spread o+er t$o

months. 'ecorated Pepsi +ans $i ro out into mar9et o% the State. 6+ery

consumer drin9ing a Pepsi %rom these +ans $i get to pay a game and $in

priDes. 4hese incude Pa$an ayan memora&iia# 4,shirts# autographed

posters and caendars.

6*paining the reason %or choosing Pa$an ayan to

endorse Pepsi# Mr. 7ohit Ohri# 'irector -4A# Pepsi;s ad agency# said Pepsi

and Pa$an ayan $ere going to &e an idea com&ination. N/oth are so

youth%u# energetic and %un,o+ing# he said. Mr. 5i3ay Shan9er

Su&ramaniam# 5ice,President (Mar9eting)# Pepsi Foods td# said the

@1


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Documents

A Study on Pepsi Company With Focus Strategy