Exploring White SpacePEPSICO PAKISTAN

Introduction and TOR Promises

Launch a Product in the Non-Potato-Chips category that has1. Wide scale Acceptability2. Profitability PotentialRecommendations for 3. Segmentation of the Winning Concept4. Flavor5. Shape6. Price7. Packaging

Rationale

• Lay’s leading player in potato chips segment• Non-Potato-Chips Category growing at 9% annually• High growth Potential in NPC category• Pepsi entered into NPC with Cheetos & Kurkure• Intense Competition in the growing NPC Segment• Need to come up with new and Innovative products to

sustain growth in the competitive NPC landscape

Overview of Three Concepts

Methodology

Secondary Research

• Review of the local and international research reports on Snack Industry• Selection of relevant variables and insights for the Focus Groups

Primary Research-

Focus Groups

• All three concepts tested against 12 Focus Groups• Focus groups distributed over SEC A, SEC B and SEC C• Gender Male and Female• Age Brackets 16-24 and 25-34

Primary Research- Survey

• Developed English and Urdu questionnaires SEC A and B and SEC C respectively.

• Large scale data collection through Researcher Administrated Interviews

Data Analysis

• Analysis of 441 Surveys through SPSS and MS Excel• Analysis of all 3 Concepts• Volume Estimation of the winning concept

14th Septem

ber, 2013 till 2nd May,

2014

Survey Design

SEC A and BMale and Female

Age: 16-24

SEC A and BMale and Female

Age: 25-35

SEC CMale and Female

Age: 16-24

SEC CMale and Female

Age: 25-35

MONADIC- ONE CONCEPT• EACH RESPONDENT WAS

EXPOSED TO ONE CONCEPTBRAND ASSOCIATION WITH PEPSICO • FOR GREATER

UNDERSTANDINGRANDOM SAMPLE • REPRESENTATIVE SAMPLE• USED FOR VOLUME

ESTIMATION

Overall Findings

Percentage of Purchase intention

Concept Purchase Intention – Mean Score

Snack Blast

Premium Nuts

Crispy Snack

3.55 3.60 3.65 3.70 3.75 3.80 3.85 3.90 3.95 4.00

3.76

3.72

3.97

Concept Attributes – Mean Score

Taste Quality Number of flavors Healthy Snack Reasonably Priced

4.64.3

4.0

3.4

3.7

4.1 4.14.3

3.9

3.4

3.8 3.8

3.4 3.53.2

3.93.7

4.2

3.4 3.5

Favorite Product Crispy Snack Premium Nuts Snack Blast

Concept Perception Results

New & Different Intensity of Liking Degree of Relevance

3.79

4.39

3.43

2.923.09

2.93

3.64

3.99

3.29

Crispy Snack Premium Nuts Snack Blast

Crispy Snack Analysis

Crispy Snack – Category Preference

Chocolate

Packed Biscuits

French Fries / Home Fried Snacks

Chips / Extrudes

Peanuts / Dried Fruits

Street Snacks

76%

50%

69%

81%

63%

71%

24%

50%

31%

19%

38%

29%

Admirers Skeptics

Crispy Snack – Attribute Perception

Better Taste

Higher Quality

Healthier Snack

Crispy Snack – Favorite Brand Comparison

Admirers like both PC and NPC snacks while skeptics are mainly interested in PC snacks

Crispy Snack – Respondents by Weekly Consumption

Crispy Snack – Behavioral I prefer quality over taste?

Crispy Snack – Purchase Frequency

Crispy Snack - Who to target?

Age: 16 – 35 years SEC A,B & C Male & Female

Premium Nuts Analysis

Premium Nuts – Category Preference

Chocolate

Packed Biscuits

French Fries / Home Fried Snacks

Chips / Extrudes

Peanuts / Dried Fruits

Street Snacks

65%

31%

72%

75%

86%

73%

35%

69%

28%

25%

14%

27%

Admirers Skeptics

Premium Nuts – Attribute Perception

Better Taste

Higher Quality

Indifferent about it being a healthier Snack

Premium Nuts – Behavioral I prefer quality over taste?

Premium Nuts – Purchase Frequency

Premium Nuts - Who to target?

Age: 16 – 35 years SEC A,B & C Male & Female

Snack Blast Analysis

Snack Blast – Category Preference

Chocolate

Packed Biscuits

French Fries / Home Fried Snacks

Chips / Extrudes

Peanuts / Dried Fruits

Street Snacks

69%

77%

64%

69%

71%

76%

31%

23%

36%

31%

29%

24%

Admirers Skeptics

Snack Blast – Attribute Perception

Better Taste

Higher Quality

Indifferent about it being a healthier Snack

Snack Blast - Who to target?

Age: 16 – 35 years SEC A,B & C Male & Female

Volume Estimation

Volume Estimation - ModelNo of HH in TA

• Total Population

• Target SEC

% of TA aware of new product

• Level of Awareness

• Strength of IMC

No of trial HH’s

• Distribution penetration

• Projected Trial Rate

Trial Volume in units

• % of purchase intent

• Average volume purchased in trial

No of repeat purchase HH

• % of repeat purchasers

Repeat Purchase Volume in units

• Average no of purchase events

• Average volume purchased

First year Sales Revenue

Total Population (Pakistan)

Number of households in the target audience (16-25) 1

Level of awareness 2

% of target audience aware of new productDistribution PenetrationNo of aware households able to access new productProjected trial rate 3

No of trial households% of Purchase intentNo of HH's who will purchase this productAverage volume purchased at trialTrial volume in units (TVIU)

No of trial households% of repeat purchasers 4

No of repeat purchase householdsAverage no of purchase eventsAverage volume purchasedRepeat purchase volume in units (RPVIU)First year sales (in units) Price Points (Rs.)Revenue

Volume Estimation - Model

Crispy Snacks

Premium Nuts

Snack Blast

Total Population (Pakistan) 190,000,000

Number of customers in the target audience (16-35) 1 66,500,000

Level of awareness 2 50%

% of target audience aware of new product 33,250,000

Distribution Penetration 60%

No of aware customers able to access new product 19,950,000

Projected trial rate 3 74%

No of customers who will purchase this product 14,763,000

Average volume purchased at trial 1.6

Trial volume in units (TVIU) 23,620,800

No of customers who will purchase this product 14,763,000

% of repeat purchasers 4 74%

No of repeat purchase customers 10,924,620

Average no of purchase events 50

Average volume purchased 1

Repeat purchase volume in units (RPVIU) 546,231,000

First year sales (in units) 569,851,800

Total Population (Pakistan) 190,000,000

Number of customers in the target audience (16-25) 1 66,500,000

Level of awareness 2 50%

% of target audience aware of new product 33,250,000

Distribution Penetration 60%

No of aware customers able to access new product 19,950,000

Projected trial rate 3 67%

No of customers who will purchase this product 13,366,500

Average volume purchased at trial 1

Trial volume in units (TVIU) 13,366,500

No of customers who will purchase this product 13,366,500

% of repeat purchasers 4 67%

No of repeat purchase customers 8,955,555

Average no of purchase events 25

Average volume purchased 1

Repeat purchase volume in units (RPVIU) 223,888,875

First year sales (in units) 237,255,375

Total Population (Pakistan) 190,000,000

Number of customers in the target audience (16-25) 1 66,500,000

Level of awareness 2 50%

% of target audience aware of new product 33,250,000

Distribution Penetration 60%

No of aware customers able to access new product 19,950,000

Projected trial rate 3 72%

No of customers who will purchase this product 14,364,000

Average volume purchased at trial 1.5

Trial volume in units (TVIU) 21,546,000

No of customers who will purchase this product 14,364,000

% of repeat purchasers 4 72%

No of repeat purchase customers 10,342,080

Average no of purchase events 50

Average volume purchased 1

Repeat purchase volume in units (RPVIU) 517,104,000

First year sales (in units) 538,650,000

General Insights• RESPONDENTS PREFERRED

TRADITIONAL PACKAGING• CONSUMERS ARE ATTRACTED

MORE TO FOOD PRODUCTS IMAGES ON THE PACKAGE

• CONSUMERS PREFERRED WAVY STICKS & CRISPY CONES

• CONSCIOUS OF HOW MUCH FAT IS THERE IN THE PRODUCT

• PREFER TASTE OVER SHAPE & PACKAGING

• PREFER QUALITY OVER TASTE

Can Traditional Transparent0%10%20%30%40%50%60%70%

Packaging Preference

Wavy Sticks Round and Hollow

Crispy Biscuits

Oval Shaped Chips

Crispy Cones

0%

5%

10%

15%

20%

25%

30%

Shape Preference

Top Flavors

Limitations

• LAHORE BASED SAMPLING• PRODUCT USE TEST NOT AVAILABLE• RESPONDENT BIAS

Thank you OPEN FOR QUESTIONS