Yeh dil maange more!!

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• Yeh dil maange more!!
• Presenters
• Rathnasabapathy
• Venkatesh Babu
• Ravindranath
• Neeraja
• Ramya
• Harihara Sudan
• Srikanta

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Profile

• Pepsi is a soft drink produced and manufactured
  by PepsiCo. It is sold in many places such as
  retail stores, restaurants, schools, cinemas and
  from vending machines. The drink was first made
  in the 1890s by pharmacist Caleb Bradham in New
  Bern, North Carolina. The brand was trademarked
  on June 16, 1903. There have been many Pepsi
  variants produced over the years since 1898.
• PepsiCo brands are available in nearly 200
  countries and territories. Many of PepsiCo's
  brand names are over 100-years-old, but the
  corporation is relatively young. PepsiCo was
  founded in 1965 through the merger of Pepsi-Cola
  and Frito-Lay. Tropicana was acquired in 1998 and
  PepsiCo merged with The Quaker Oats Company,
  including Gatorade, in 2001.
• PepsiCo (symbol PEP) shares are traded
  principally on the New York Stock Exchange in the
  United States. The company is also listed on the
  Amsterdam, Chicago, Swiss and Tokyo stock
  exchanges. PepsiCo has consistently paid cash
  dividends since the corporation was founded.
• PepsiCo World Headquarters is located in
  Purchase, New York, approximately 45 minutes from
  New York City.

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Cont

• Revenues in 2007 is more than 39 billion.
• 37 bottling plants in India, of which 16 are
  company owned and 21 are franchisee owned.
• PepsiCos Frito Lay snack division has 3 state of
  the art plants.
• It has more than 185,000 employees across the
  world.
• In India, PepsiCo provides direct employment to
  4,000 people and indirect employment to 60,000
  people including suppliers and distributors.
• CEO Ms. Indra K Nooyi
• India Headquarters Gurgaon.

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Brand Image of Pepsi

• Pepsi is a brand that every youngster relates to.
• But this definitely doesnt mean that other age
  groups are not its users.
• Thus Pepsis brand image is its hip, cool,
  lively and refreshing attitude.

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Advertising Strategy of Pepsi

• Pepsis target audience are mostly teens and
  young adults and their advertising reflects this
  in every possible way.
• The company changes its advertising strategy and
  image to reflect the target's interests.
• Pepsi makes sure that the advertisements reflect
  to the target audiences interests and
  nostalgia.
• The advertising strategy includes cool, hip
  promos to attract more of the target audience.
• The advertising is mostly creative and has
  different elements like music and sports other
  than bollywood.
• Pepsi.com also plays an important role in
  advertising and attracts target audience by
  giving access to options like downloads, gaming,
  music mixing applications etc..

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Advertising History

• Pepsi has continuously focused on the current
  teen generation.
• How Pepsi has used humor, music, sex appeal in
  advertising.
• Ad expenditures for 2001 is 1,800,000,000

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Slogans

• 1939 - Twice as Much for a Nickel
• 1950 - More Bounce to the Ounce
• 1958 - Be Sociable, Have a Pepsi
• 1961 - Now Its Pepsi for Those Who Think Young
• 1963 - Come Alive, Youre in the Pepsi
  Generation
• 1967 - (Taste that beats the others cold) Pepsi
  Pours It On
• 1969 - Youve Got a Lot to Live, Pepsis Got a
  Lot to Give
• 1984 - Pepsi. The Choice of a New Generation
• 1985 - New Generation advertising continues
• 1992 - Gotta Have It
• 1993 - Be Young, Have Fun, Drink Pepsi
• 1997 - Generation Next
• 2000 - Joy of Cola

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International brands.
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North American brands
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Generation Y- Market Influence

• Huge market 80 million people
• Spending power 600 million annually
• Many Geb Yers do household grocery shopping
• 90 parents say kids influence what they buy
• Many work and have their own money to spend
• They have proven to be brand loyal

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How to reach Generation Y

• Creates promotion tailored to their needs and
  interests.
• Gen Yers like entertainment and music
• They like to laugh, but not at another's expense
• To attract the teen market radio and television
  should be used
• They are internet savvy

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What does Generation Y like?

• Free stuffs and discounts
• Contests/drawings
• Music
• Club cards
• Team sporting events
• They are into clothes and the latest styles
• Teen friendly retail stores and internet site

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Pepsi and Generation Y

• Pepsi targets Generation Y specifically
• Current campaigns use of effective techniques
• By targeting 12 to 21 year olds, Pepsi is
  attempting to establish a loyal pepsi drinker
  for life and the largest group of soft drink
  consumer.

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Advertising campaigns
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Michael Jackson

• Michael received the biggest sponsorship from the
  company in 1993.
• In 1993 Pepsi had a Search for Michael Jackson
  campaign.
• Used musical and sex appeal.

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Jeff Gordon

• Made a commercial with Hallie Eisenberg
• Sells many Pepsi collectable merchandise.
• Drove the Pepsi car in races

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Hallie Eisenberg

• First appeared in a Pepsi commercial in 1998 at
  age 5
• Introduced the Joy of Cola campaign.
• Starred in commercials with Faith Hill, KISS, and
  Ken Griffey Jr.
• Her commercials used humor.

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Spice Girls

• Promotional single Move over available only
  through Pepsi.
• Used musical and sex appeal.
• As international stars they affected many
  countries

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Type A B celebrities

• Type A celebrity one that is well known and
  well liked by their target market.
• Type B celebrity one that is known by their
  market

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Issues

• Hard to differentiate product in terms of taste
  as product variety is very limited within cola
  based beverages.
• Coca-cola has such a strong base of loyal
  customers, who identify with the cola brand.
• Consumer tastes are changing, away from
  carbonated drinks towards functional soft drinks.
  (Mintel, et al. 2009)

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Competitive Aids

• SWOT Analysis
• Porters strategies for competitive environment

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SWOT analysis

• Strength
• Pepsi has a broader product line and outstanding
  reputation.
• Merger of Quaker Oats produced synergy across the
  board.
• Record revenues and increasing market share.
• Lack of capital constraints (availability of
  large cash flow).
• Great brands, strong distribution, innovative
  capabilities.
• Number of maker of snacks, such as corn chips and
  potato chips.
• PepsiCo sells three products through the same
  distribution channel.
• Weakness
• Pepsi hard to inspire vision and direction for
  large global company.
• Not all PepsiCo products bears the company name.
• PepsiCo is far away from leader Coca-cola in the
  international market demand is highly elastic.

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Cont

• Opportunity
• Food division should expand internationally.
• Noncarbonated drinks are the fastest-growing part
  of the industry.
• There are increasing trend towards healthy foods.
• Focus on most important customer trend
  Convenience
• Threats
• FB industry is mature.
• Pepsi is blamed for pesticide residues in their
  products in one of their promising emerging
  market e.g. in India.
• PepsiCo now competes with Cadbury Schweppes,
  Coca-cola, and Kraft foods (because of their
  broader product line) which are well-run and
  financially sound competitors.
• Size of company will demand a varied marketing
  program Social, cultural, economic, political
  and governmental constraints.

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Porters 5 Force Model
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Porters 5 forces model

• The five forces model of Porter is and outside-in
  business unit strategy tool that is used to make
  an analysis of the attractiveness (value) of an
  industry structure
• Allows the development of a competitive strategy
• Suggests 5 main forces may be decisive in helping
  shape the outcome
• Suppliers
• New entrants
• Substitutes
• Buyers
• Industrial competitors

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Cont
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Threats of new entrants

• New entrants bring increased capacity to the
  industry and are often backed by substantial
  resources.
• New entrants can be deterred by barriers to
  entry

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Threat of new entrant

• The main barriers are.
• Economies of scale
• Patents
• Product differentiation
• Capital requirements (financial specialist
  equipment)
• Skills
• Reaction/strategic decisions of incumbents
  (ex-all undercut new entrant)
• Government policy (ex-de-regulation)

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The bargaining power of suppliers

• Supplier exert power in the industry by
  threatening to raise prices or reduce quality.
• Powerful suppliers can squeeze industry
  profitability if firms are unable to recover cost
  increases.

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The bargaining power of suppliers

• Suppliers are likely to be powerful if
• Supplier industry is dominated by a new firms.
• Suppliers products have few substitutes.
• Buyer is not an important input to buyers
  product.
• Suppliers products have high switching cost.

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The bargaining power of buyers

• Buyers compete with the supplying industry by
• Bargaining down prices
• Forcing higher quality
• Playing firms off of one another

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The threat of substitute products

• Products with similar function limit the prices
  firms can charge
• Keys to evaluate substitute products
• Products with improving price/performance
  tradeoffs relative to present industry products

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The threat of substitute products..Questions?

• How many substitute products/services have
  appeared in your industry in the last 5 years?
• What are they? How different are they?
• Were they introduced by your organization or
  others?
• Which organization in your industry does the most
  Research and Development?
• What happens to price, profits and market share
  when substitutes are introduced?

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Rivalry among existing competitors

• Intensive rivalry often plays out in the
  following ways
• Price competition
• Advertising battles
• Increasing consumer warranties and service
• New product roll-outs
• Price competition often leaves the entire
  industry worse off

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Porters 5 model PepsiCo

• Traditional competition
• Prices of Coca Cola, local brands
• Market share
• Promotional actions of competition
• New entrants
• New look-alike manufacturers
• Substitute products
• Fashionable new drinks, milk drinks, coffee,
  beer, water, smoothies

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Porters 5 model PepsiCo

• Suppliers
• Price and availability of ingredients on world
  market.
• Quality, speed, safety, traceability, flexibility
  of supply chain.
• Buyers/consumers
• High as a result of intense competition both
  among branded and unbranded products.
• Combined purchase power of shops, bars,
  supermarkets

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Pepsis Successes and Failures in Brazil and
Germany

• PesiCo has been operating in Brazil since 1953
• Pepsis heavy new investment in Brazil, which
  actually started early this year, is funneled
  through a joint venture with Baesa, a bottler
  based in Buenos Aires that operates in Argentina,
  Chile, Costa Rica and Puerto Rico.
• PepsiCo in Germany made a smarter move by
  acquiring Punica, Germanys premiere juice
  provider.
• PepsiCo is one of the worlds largest
  manufacturer, seller and distributor of beverages
• Pepsi has very limited brands in Germany.
• Their struggles in Germany include Coca-cola and
  a rash of suicidal commercials for Pepsi Max that
  depicts a single lonely calorie committing
  suicide.

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Marketing Products and Services

• Taste testing
• Television, Billboard and Print Media
• Interactive/Web-based marketing

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Recommendations

• Adopting a Cost-Leadership Stratergy
• New Product Development

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Cost-Leadership Strategy

• Advertising and innovative promotion.
• Optimal outsourcing for production and vertical
  integration.
• Improving production efficiencies through Kaizen.

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New Product Development

• Produce a range of healthy alternatives under
  the brand name Pepsi Fresh.
• Our suggestion would be a range of Vitamin
  enrinched waters under the name Pepsi Fresh

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Conclusion

• It can be seen then that differences do exist
  between Coca-Cola and Pepsi Cola.
• This can be seen in the marketing variables which
  are the basis for segmentation such as age and
  geographic variables.
• In a competitive market, both companies must
  identify and target different market segments in
  order to remain at the cutting edge.
• Differences between the companies are evident
  with respect to product, pricing, place and
  promotion.
• Coca-cola relies heavily on value quality is
  more than something we see or taste.
  (http//www.coca-cola.com).
• Pepsi, on the other hand, relies on its success
  resulting from superior products and high
  standards of performance (http//www.pepsico.com).