Starategic Managment

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TERM PAPE

OF STRATEGIC MANAGEMENT

TOPIC: MARKETING STRATEGIES

USED BY PEPSI IN INDIA.Study on roleof

Financial Institutions in promoting Submitted by:-

Mohd Anwar Kamal

REG. NO:-10907920

ROLL.NO:-RR1902A53



LOVELY SCHOOL OF BUSINESS

ACKNOWLEDGMENT No Endeavour however small can be successfully accomplished without the Concrete efforts of

all concerned. I was fortunate in being given full co-Operation & help whenever I sought it in the

course of my research.

There are a few things that come in the life of a person, may be for a short span of time, but

leaves on ever shining impression in to the mind. My Term Paper is one of the events which will

be ever green in my life.

I avail this opportunity to express my profound sense of sincere and deep gratitude to many

people who are responsible for the knowledge and experience I have gained during the term

paper work.

I express my sincere my thanks to Mrs. Gagandeep Bhatarawho help me on create my TERM

PAPER.

MOHD ANWAR KAMAL MBA

SECTION-1902 REG.NO.10907920 ROLL NO:-RR1902A53

Thank You

Madam!



Contents

1. INTODUCTION

2. PEPSI IN INDIAN SCENARIO

3. PRODUCT LINES OF PEPSI

4. SEGMENTATION

5. TARGETING

6. POSITIONING

7. MARKETING MIX

8. ANALYZE ABOVE MENTIONED STRATEGIES

9. ALTERNATE SOLUTIONS

10. CONCLUTION

11. REFRENCES



INTODUCTION

Pepsi established its business operations in 1989.It aims to serve the long term dynamic needs of

consumers in India.

Pepsi is a world leader in convenient snacks, foods and beverages, with revenues of more than

$39 billion and over 185,000 employees. Pepsi is a world leader in convenient snacks, foods and

beverages, with revenues of more than $39 billion and over 185,000 employees. The company

consists of Pepsi Americas Foods (PAF), Pepsi Americas Beverages (PAB) and Pepsi

International (PI).PAF includes Frito-Lay North America, Quaker Foods North America and all

Latin America food and snack businesses, including Sabritas and Gamesa businesses in Mexico.

PAB includes Pepsi Beverages North America and all Latin American beverage businesses. PI

includes all Pepsi businesses in the United Kingdom, Europe, Asia, Middle East and Africa.

Pepsi brands are available in nearly 200 countries and generate sales at the retail level of more

than $98 billion. Some of Pepsi's brand names are more than 100-years-old, but the corporation

is relatively young. Pepsi was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay.

Tropicana was acquired in 1998 and Pepsi merged with The Quaker Oats Company, including

Gatorade, in 2001.Pepsi offers product choices to meet a broad variety of needs and preference

from fun-for-you items to product choices that contribute to healthier lifestyles.

Pepsi¶s mission is ³To be the world's premier consumer products company focused on

convenient foods and beverages. We seek to produce healthy financial rewards to investors as

we provide opportunities for growth and enrichment to our employees, our business partners and

the communities in which we operate.



PEPSI IN INDIAN SCENARIO

Since the entry of Pepsi-Cola to India in 1989, the soft drink industry has under gone a radical

change. When Pepsi-Cola entered, Parle was the leader with the Thums-up being its flagship

brand. Other products offering by Parle included Limca & Goldspot, another upcoming player in

the market was, the erstwhile bottler of Coca-Cola, ³pure drinks´. Its offering includes Campa-

Cola, Campa-Lemon & Campa-Orange.

With the re-entry of Coca-Cola in the Indian market, Pepsi-Cola had to go in for more aggressive

marketing to sustain its market share. The chronology of the initial phase of the Cola wars in

India was:

y 1977: Parle launched Thums-up and pure drinks launched Coca-Cola.

y 1998: In September, final approval for the Pepsi Foods Ltd. Project granted by the

³Cabinet Committee´ on economic affairs of the ³Rajeev Gandhi Govt.´

y 1990: In March, ³Pepsi-Cola and 7-up´ launched markets in north India.

y 1990: In May, The government cleared the Pepsi-Cola project again but with a change in brand name to ³Lehar Pepsi´, simultaneously it rejects the Coca-Cola application

³Citra´ from the Parle, stable hited the market.

y 1991: Pepsi-Cola extended its soft drinks business and reached at national scale. Pepsi-

Cola launched its product in Delhi and Bombay.

y 1992: In January, Brito foods application is cleared by the FIPB. Pepsi-Cola and Parle

start initial negotiation for a strategic alliance but took break off after a while.

y 1993: Pepsi-Cola launched ³Slice and Teem´ captured about 25-30% of the soft drink

market in about 2 years.

y 1994: Pepsi bought ³Dukes & Sones´.

y 1995: Pepsi-Cola lunched cans, having capacity of 330ml in various flavors



y 1996: Pepsi-Cola domestic and international operations combined into a Pepsi-Cola

Company. International and domestic operations combined into one business unit called

³Frito-lay Company´.

y 1997: Pepsi-Cola brought ³Mirinda Orange´ opposite to ³Fanta´.

y 1998: Pepsi-Cola launched ³Mirinda Lemon´ opposite to ³Limca´.

y 1999: Pepsi-Cola launched ³Diet Pepsi´ in can and 1.5 Lit. ³PET´ bottle for health

conscious people.

y 2001: Pepsi-Cola launched Slice in ³Tetra´ Pack.

y 2003: Pepsi-Cola launched ³Pepsi Blue´ to get the favour of world cup season.

y 2005: Pepsi-Cola launched Mirinda in ³Straw Berry´ flavour to get the favour of movie

Batman.

y 2005: Pepsi-Cola launched 7-up as ³7-up ice´.

y Pepsi-Cola launched ³Mountain Dew´ to be more competitive with Coca-Cola

y 2009: Bangalore, March 9 Pepsi India has launched its packaged nimbu paani µNimbooz

by 7Up.

y 2010: Introduction of Pepsi max



PRODUCT LINES OF PEPSI

FOOD

Pepsi's foods division Frito-Lay is the leader in the branded salty snack market and all it's

products are free of trans-fat and MSG. It manufactures Lays Potato Chips, Cheetos extruded

snacks, Uncle Chips and traditional snacks under the Kurkure and Lehar brands. The

companys high fibre breakfast cereal, Quaker Oats and low fat and roasted snack options like

Aliva enhance the healthful choices available to consumers.

BEVERAGE

Pepsi India's expansive portfolio includes iconic refreshment beverages such as Pepsi, 7UP,

Nimbooz, Mirinda, Slice and Mountain Dew; in addition to low calorie options such as Diet

Pepsi, hydrating and nutritional beverages such as Aquafina drinking water, isotonic sports

drinks - Gatorade, Tropicana 100%, Tropicana Twister fruit juices

BEVERAGE INDUSTRY

Beverage industry is one of the fast growing industries in India .it can be divided into two

sections i.e. carbonated and non-carbonated. the carbonated drinks that can be further classified

into cola, lemon orange, mango and apple segments.

Marketing includes all the activities like promotion, distribution, advertising etc. To fulfill all

the segments of consumers. Marketing is also to convert social needs into profitableopportunities.

Now we will talk about the segmentation , targeting and positioning of the beverage sector. To

explain STP strategies we have focused on the soft drink segment of the pepsi.



SEGMENTATION

The market has being segmented by pepsi on the following grounds. Pepsi Co have adopted

different marketing strategy for rural and urban areas.

A:-DEMOGRAPHIC SEGMENTATION

Age

India is considered to be a young country i.e. average age of Indian population is less 38years.

Thus targeting young generation can be a beneficial marketing strategy for soft drink companies.

In fact this is the case, all the major brands like Pepsi, coca cola, and thumps up, mainly target

younger generation in India. In Europe, as average population is older than Asian countries, Coca

cola targeted the older generation of the population. Similarly in USA, Pepsi targeted the

generation X (younger generation) as they comprises majority of the population and they

positioned Pepsi in the mind of youth that Pepsi is for the youth. Pepsi attempts to capture the



youth of today by focusing on their personality, lifestyle and attitude of youth through

advertisement

Geographic region

As mentioned earlier Pepsi has segmented the market on the basis of rural and urban area.As the

climate of the country is hot and dry it aims at the geographical areas where people actually

require something to quench their thirst. That is why pepsi came with chota pepsi in rural areas

to tap the market where people wants cold drink which is good as well as cost effective.

B:-Behavioral

In occasions like parties, birthdays, sports and regular occasions the soft drinks are preferred at

every occasion. It is liked by each and every member of the family whether a child or an adult or

an teenager. Even if there is no occasion due to environmental factors people do purchase pepsi.

GENDER

Gender based segmentation is very important. As taste of male and female is different. Let¶s take

the example of coca cola, thumps up is promoted as masculine soft drinks while coca cola and

Fanta are having light taste and mainly targeted for loving birds, ladies, and children. Same

example is available in Pepsi, mirinda orange flavor is popular among ladies, girls, and children.



TASTE AND PREFERENCES

According to the taste and preference of the customers pepsi came up with the product like diet

pepsi.It came up with diet pepsi in order to cater to the needs of those people who are very health

conscious.

TARGETING

Pepsi targets both the rural as well as the urban segments. For urban segments the targeting

strategy is trendy cans,fridge packs which is mostly trendy and liked by the youngsters. The rural

market is targeted with entirely different strategy altogether. They keep price as an important

decision making variable.

POSITIONING

Positioning has come to mean the process by which marketers try to create an image or identity

in the minds of their target market for its product or brand .



Pepsi prefers to position itself as the beverage choice of the ³New Generation´, ³Generation

Next´, or just as the ³Pepsi Generation´.

These terms adopted in Pepsi¶s advertising campaigns are referring to the markets that marketers

refer to as Generation X. The Generation X consumer is profiled to be between the ages of 18 to

29. They have high expectations in life and are very mobile and active. They adopt a lifestyle of

living for today and not worrying about long-term goals. Though Pepsi¶s main emphasis is on

this segment but they also have a focus on the 12 to 18 year old market. The rich deep blue

coloring represents eternal youthfulness and openness. Marketing plans like ³Yeh Dil Maange

More´, ³Got Another

Pepsi, ³Ye Pyass Hai Badi´ and now its ³Yeh Hai Youngistaan Meri Jaan´ have made Pepsi one

of the coolest brands recognized among teens in the top five and the only beverage product in

this category



MARKETING MIX

Product

A business needs to consider the products that it produces and the stage of the product life cycle

that a product is at. Marketing strategies will vary according to the type of product and its stage

in the life cycle.

In case of Pepsi, in the rural markets, the 300ml bottle and now days the newsmall or commonly

known as the ³chota pepsi´ is very much popular. The Pepsi Co. is even thinking of introducing

their new Pepsi-Aha, but presently they are concentrating more on the normal pepsi as the rural

market is a niche market. Pepsi is even successful in introducing the big 1-1.5 liter PET bottles in

the rural markets. These big bottles are very popular during big festivals and marriages. We see

that pepsi has differentiated the product category on the basis of diet and regular pepsi as well

depending on the varied needs of the customers.



PRICE

As far as the pricing goes, the 300 ml Pepsi bottle is priced at Rs. 10 now it is 12. But the

company soon realized that this pricing worked in the urban markets but not in the rural markets

as in the rural markets, Pepsi is not anecessity but a luxury. They found out that people in the

rural markets bought cold drinks only if there was some occasion. A price point of Rs 10 for a

300 ml bottle has proved a major deterrent: it has kept away new consumers in the urban and

semi-urban pockets, and it has blanked out the far larger rural markets where annual per capita

consumption is less than a bottle. So the Rs. 10 bottle was not that successful. But their sales

increased after introducing the ³chota Pepsi´. This 200ml Pepsi was reasonably priced between

Rs.5- Rs.7. This was a major weapon for the expansion of the rural market.But there are other

areas of concern ² principally that the 200 ml offering should not cannibalize 300 ml sales. In

that case, there will be no market growth. That is why pricing could be crucial. Pepsi, for

instance, has reckoned that giving consumers 33 per cent (100 ml) less cola at 50 per cent of the



price (Rs 5) is not a sustainable option and can, at best, be used as an introductory offer.300 ml

bottles have almost vanished from the market now.Hats Off to the pricing strategy of the Cola

Companies who have been successfully able to sell 66% of the product at the cost of 100%

almost in a phased manner and making consumer habitual and unaware of the increased price.

PLACE

This generally refers to the physical locations of product sales as well as the methods of

distribution. However, it is also considered to be the "place" or "position" in the market of the

product; refer to information below. Businesses need to make many decisions related to "place":

access, parking, competition, physical location etc. In case of the distribution network, there is

no involvement of wholesalers in the distribution of products. It is more like an agent network.

The companies have divided the country into various regions and established a franchisee in each

region. The franchisees have their own bottling plants and manage all the day-to-day operations.

However, of late, the soft drinks companies have started setting up company owned bottling

units have been acquiring some of its franchise bottles. For Pepsi, the rural market is a chosen

thrust this year. It has targeted to reach 20 to 28 percent of the rural population in the first year of

this operation. In the first stage, the corporation is planning a massive roll out in villages with

populations of 5000. To do this effectively, Pepsi is focusing on establishing a cold chain.

The company has developed special freezers that allow its products to stay chilled despite power

cuts of three to four hours. It will also use traditional iceboxes to sell its product in rural India.

For the rural markets, Pepsi is looking at the wholesale route since the logistics of direct

distribution are too huge to handle in the interiors.



PROMOTION

This refers to the promotion of the product to the target market. This is achieved through a

combination of: advertising: use of electronic and print media. The "reach" (how many peoplewill see the advert), frequency (how many times will I advertise the product?) and impact of the

advertising must also be evaluated.

The popularity of the product has also increased due to their advertisements or basically famous

cricket and bollywood personalities endorsing this product. For instance the Sachin ³Aala re

Aala´ advertisement where even he is wearing a mask along with those rural kids. Or you can

even take the new Sachin and Amitabh Bachchan advertisement where both of them say ³ Yeh

Dil Maange More!!!!!!!´ Sachin has done many advertisements for Pepsi in the span of 10years.

Pepsi¶s rural market advertisement- Pepsi has unveiled a major campaign in Andhra Pradesh,

roping in top Telugu film star, Pawan Kalyan, even as the star's elder brother, Chiranjeevi, is into

pushing Coca-Cola's Thums Up. Pawan Kalyan, however, ruled out any rivalry between him and

his brother. Though he will sing Yeh Dil Maange more, his brother will say Yeh Dil Maange no

more. ³We have our lives and we have our own choices,´ he said on the possible in-house cola

feud.

Pepsi also kicked off a rural campaign, spread over two months. Decorated Pepsi vans will roll

out into market of the State. Every consumer drinking a Pepsi from these vans will get to play a

game and win prizes. These include Pawan Kalyan memorabilia, T-shirts, autographed posters

and calendars.



Explaining the reason for choosing Pawan Kalyan to endorse Pepsi, Mr. Rohit Ohri, Director

HTA, Pepsi's ad agency, said Pepsi and Pawan Kalyan were going to be an ideal combination.

³Both are so youthful, energetic and fun-loving,´ he said. Mr. Vijay Shanker Subramaniam,

Vice-President (Marketing), Pepsi Foods Ltd, said the company was starting an ³aggressive

campaign´ in Andhra Pradesh. Apart from the van operations, which were flagged off by

PawanKalyan, other campaigns have been lined up throughout the year. Later, Pawan Kalyan

presented a cheque for Rs 5 lakh to Mr. Mehmood Ali, a mechanic with the Andhra Pradesh

State Road Transport Corporation for winning Pepsi's Mera number ayega campaign.

1992 Gotta Have It

1993 Be Young, Have Fun, Drink Pepsi

1995 Nothing Else is a Pepsi

1997 Generation Next

1998 Same Great Taste

1999 The Joy of Cola

2003

2004

2005

2006

Pepsi. It's the Cola





ANALYZE ABOVE MENTIONED STRATEGIES

1) lack of efficiency in distribution network in some product lines. for eg. My can and

Aliva.

2) Lack of emphasis on the brand value in advertisements. For eg. Aliva and kurkure.

3) Lack of efficiency in product market survey before the launch of products. For eg pepsi

blue and kurkure desi beats.

4) The target market is youth and the taste is not in relation with the taste of target

market(pepsi is too sweet)



ALTERNATE SOLUTIONS

a. as the product is mass product therefore the efficient distribution system should be

there. Pepsi does not have apt number of distributors in its supply chain. Due to

this reason we don't see my can in all the stores across the stores.

b. The advertisements should have the logo of Pepsi so as to get proper attention of

the customers & encouraging them to purchase it.

c. They should have an efficient department for conducting the surveys so that theyare able to succeed at the customers front.

d. There can be a different product launch that can be a good competition to its rival

products in this market



CONCLUSION

The project gives the basic insight of the beverage segment of the Pepsi .where in the group has

tried to identify the concepts taught in the class to the real life scenario.we have tried to cover the

entire sector by describing the following concepts:-

The 4 P's

STP concept Demographic & Psychographic factors

Marketing mix

In this project we have tried to identify the flaws in the beverage industry of the company and the

group has tried to bring out some worthy solutions to the problems arising in this sector.

As we can see from the above chart pepsi was the top fizzing brands in year 2005.It was having

the maximum market share of 35% which was much higher than the brand having the second

highest market share. To increase its share in current scenario pepsico has launched pepsi MAX.

Pepsi is still the market leader in current era..



REFERENCES/ BIBLIOGRAPHY

www.pepesico.com

www.pepesiindia.co.in

http://www.hartford-hwp.com/archives/52a/042.html

http://www.icmrindia.org/casestudies/catalogue/Business%20Strategy1/BSTR062.htm

http://www.doc/8719148/Pepsi-Marketing-Mix

http://www.icmrindia.org/casestudies/catalogue/Business%20Strategy1/BSTR062.htm

http://www.123oye.com/job-articles/business-corporates/target-marketing.htm

http://www.exchange4media.com/viewpoint/viewpoint.asp?view_id=47

http://en.oboulo.com/pepsi-s-entry-into-india-a-well-planned-out-strategy-63045.html

http://www.authorstream.com/Presentation/sunidhi1128-119631-pepsi-strategy-killing-softly-

education-ppt-powerpoint/

http://www.google.co.in/images?hl=en&source=imghp&biw=1366&bih=667&q=pepsi+advertisement&

gbv=2&aq=1&aqi=g7g-m3&aql=&oq=pepsi+ad&gs_rfai=

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